[LINK] Up Against the Firewall [China]
Wed Nov 13 00:14:48 EST 2002
Up Against the Firewall
U.S. technology companies are helping China build its Big Brother
Internet--the political fallout has already begun.
By Ethan Gutmann
November 8, 2002
January 2001: Network Associates Technology, Symantec, and Trend Micro gain
entry to the Chinese market by donating 300 live computer viruses to the
Public Security Bureau--China's state police--raising Pentagon concerns
about China's information warfare capabilities.
December 2001: A human rights activist accuses Nortel Networks of
co?perating with China's police by enhancing digital surveillance networks
and transferring to the Chinese Ministry of State Security technology
developed for the FBI.
February 2002: A former Yahoo China executive confirms that the company
routinely censors its chat rooms and search functions. Several Chinese
engineers claim that, in the late '90s, Cisco Systems fashioned a "special
firewall box" for Chinese authorities to block Web sites.
Why are American corporations, which have labored hard to present positive
global images, providing censorship and surveillance technologies to what
many see as China's Big Brother Internet? The short answer: money. Building
China's Internet means making lots of it, and companies that want access to
this new market often must give the Chinese leadership what it demands.
Their willingness, however, to placate the leadership has begun to attract
the attention of journalists, dissidents, and hacktivists, as well as, most
ominously, for U.S. business interests, shareholders, and Congress. On May
30, Cisco Systems and the U.S. Securities and Exchange Commission received
a proposed shareholder resolution (a method shareholders use to change
corporate policy). The shareholder, who prefers not to be named, attacked
the morality of Cisco's China operations and proposed that the company
report annually to shareholders on all its products sold to state-owned
entities in countries, like China, that employ national firewalls or
monitor Internet traffic. Seven weeks later, Cisco's lawyers responded with
an 18-page document (with narrow margins) rejecting the shareholder's
proposal as unfeasible and inflammatory. Client confidentiality would be
damaged on a global scale, according to Cisco. Plus, the company added, the
shareholder's accusations were misleading: China's public security
standards are equivalent to U.S. government standards, and Cisco has not
"specially designed any products whatsoever for the government of the PRC
to block or filter content."
While it may be technically correct that Cisco also sold its "special
firewall box" to countries other than China (even though it may have first
developed it for China), the company's portrayal of business-as-usual in
China is disingenuous: it's unlikely Cisco was able to capture 75 percent
of the Chinese router market without making major concessions to the
The underlying dilemma--adhering to American democratic ideals while
placating Chinese autocratic demands--explains why Cisco's lawyers were
tied up for weeks refuting a shareholder proposal that by most accounts
likely won't amount to much.
But Cisco should not expect the same outcome in Washington. Think tanks
like the American Enterprise Institute and Rand have supplied research and
witnesses for congressional committees concerned with human rights in
China. And the U.S.-China Security Review Commission, a bipartisan
committee that reports to Congress on the national security implications of
U.S.-China trade, privately questioned Cisco and Nortel Networks on their
China operations. Nortel claimed that it didn't make the technologies it is
accused of transferring, and Cisco replied with an abbreviated version of
its shareholder resolution response. The commission's July 15 report to
Congress explicitly mentions AOL Time Warner and Yahoo as possibly
complying with the demands of Chinese authorities, but lets off Cisco,
Nortel, and others with a nonspecific reference to assisting "the Chinese
Government in sensitive areas such as remote surveillance, online
censorship, and virus acquisition."
Two weeks later, the House of Representatives Policy Committee, a forum for
discussing specific legislative initiatives, stated the official position
of the Republican majority in a report dramatically entitled "Tear Down
This Firewall." The committee advocates massive government intervention to
free the global Internet. The report, however, stops short of calling for
sanctions on the transfer of U.S. firewall and surveillance technologies to
Despite the subdued language, Washington's mood should not be misread. The
prominence of the Internet in China in two major reports, both of which
invoke national security, suggests that preliminary export controls or,
more likely, a corporate code of conduct, may be waiting in the wings. As
one influential government official told me confidentially, "This is more
than a PR problem for U.S. Internet companies. This is potentially the
downfall of corporate appeasement to the PRC."
Meanwhile, concerned by the heat on U.S. companies and protective of their
"New China" image, Chinese authorities have implemented excellent damage
control. Chinese ISPs recently lifted blocks on most U.S. news Web sites
(while continuing the comprehensive blocking of Chinese democracy and labor
sites). Simultaneously, a state-affiliated shill for Beijing's Internet
objectives, the Internet Society of China, rolled out a "voluntary" pledge
of corporate responsibility for the industry, emphasizing
"self-discipline," "trustworthiness," and a commitment to "state security"
and "social stability." In other words, don't block the entire CNN Web
site, but anything potentially offensive to Beijing should mysteriously
experience technical trouble. But, as experienced by AltaVista and Google
in early fall, Chinese authorities haven't sworn off completely blocking
access to Web sites. Three hundred Chinese firms signed the pledge--as did
Yahoo. Human Rights Watch, a nonprofit watchdog group, attacked Yahoo,
whose actions now seem particularly irksome given the larger context:
Beijing is shutting down most of its Internet cafÈs, cracking down on proxy
servers, which allow people to surf the Web anonymously, and has sentenced
a man to 11 years in prison simply for downloading political content.
The Chinese policy of "voluntary" hair-trigger censorship, combined with
the appearance of liberalization (in short, a public relations coup), could
ultimately backfire on Western corporations (see "Restricted Area"). The
Communist Party is a notoriously unreliable partner: What if China's state
police end the next worker uprising using guns and Motorola
location-tracking technology? Or what if Chinese officials move beyond the
discussion phase to implement a national identification system developed by
Xerox or Nortel--both of which, sources say, are interested in supplying
such technology--and then use it to track the movements of and round up
Chinese Christian groups? How will U.S. corporations handle these
scenarios? "Just good business" in Beijing might mean a congressional
crackdown in Washington.
Technology companies should avoid the Chinese Internet pledge and the
national ID contract, and should take credit for their restraint.
Corporations like Microsoft, which fought China on encryption and won,
should guard their U.S. flank by spearheading a collective statement
expressing concern over China's Internet censorship and surveillance.
There's safety in numbers--no single corporation should bear the brunt of
the Chinese leadership's anger.
"Voluntary," "corporate responsibility," "trust"--these are our words, not
theirs. The Chinese leadership just pirated them. There's still time to
drop the denials, adopt a unified strategy, and do business as if our words
Ethan Gutmann, a visiting fellow at the Project for the New American
Century, is finishing a book, Beijing Boot Camp (Encounter Books, 2003).
History teaches us that men and nations behave wisely once they have
exhausted all other alternatives
-- Abba Eban
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