China’s hard court press

MYRNA BROWN, HOST: It’s Thursday the 11th of November, 2021. You’re listening to The World and Everything in It. Good morning, I’m Myrna Brown.

MARY REICHARD, HOST: And I’m Mary Reichard. First up: China plays economic hardball.

For many years China has faced accusations of underhanded business practices. But more recently Beijing has stepped into the “celebrity influencer” game. WORLD’s Josh Schumacher reports.

KANTER: My message to the Chinese government is, “Free Tibet.” Tibet belongs to Tibetans...

JOSHUA SCHUMACHER, REPORTER: Boston Celtics player Enes Kanter took to Twitter a few weeks ago to show support for Tibetan independence. He also wore shoes bearing the slogan “Free Tibet” during the Celtics’ game on October 20th against the New York Knicks.

Backlash came swiftly.

AUDIO: [Man speaking Mandarin]

A Chinese foreign ministry spokesman called Kanter’s comments “not worth refuting.” But the Chinese streaming platform Tencent banned video feeds of all Celtics games in China.

And this isn’t the first time Beijing has lashed out at NBA players and coaches over critical comments. During the 2019 Hong Kong riots, Beijing effectively cancelled the Houston Rockets in China after manager Daryl Morey expressed support for Hong Kong’s independence. As payback, China ordered all Rockets merchandise pulled from stores and banned streaming of the team’s games.

Zane Zovak is a research analyst at the Foundation for Defense of Democracies. He says this kind of economic pressure is becoming much more common.

ZOVAK: So it seems to be a little bit of a template here for, you say anything about China or against the official narrative, and they're going to come out against you.

And Zovak says China isn’t just going hard in the paint. Beijing has also cancelled critics in areas of show business outside the NBA.

ZOVAK: They seem to be targeting any sort of influential figures, or celebrities, or anything in the media that might cut against the official narrative. So in the past, and there's some notable examples…

According to Zovak, last year in the lead up to the latest Fast and Furious movie, actor John Cena made an innocuous comment about Taiwan being its own country. After an outcry, Cena released a video apology, in Mandarin.

ZOVAK: ...And I think the message there was very clear that, you know, this is just an example of him to sort of kow-towing away to China and the fact that one of their main state media companies is behind the production. And this again, being not the exception, but the rule...

But show business isn’t the only business in which China has been bullying U.S. companies. Derek Scissors is a senior fellow at the American Enterprise Institute.

SCISSORS: We've also had companies which have said, you know, either stated or used maps that imply Taiwan is separate from China, have been harassed by the Chinese. There have been informal boycotts organized, which are usually encouraged by the government...

But this isn’t just simple harassment. There’s also a lot of what Scissors refers to as “normal coercion” taking place.

SCISSORS: Claiming that U.S. firms had cooperated with U.S. investigations of Chinese goods, or technology theft, singling out U.S. firms for monopoly investigations, when the Chinese encourage monopolies among state owned enterprises.

One area of Chinese bullying in particular? Intellectual property theft. It takes place in two forms. Scissors describes the first as “coercion.”

SCISSORS: Coercion is when the Chinese come to a company that's selling to China and saying, “Boy, you're making a lot of money in China, you know, if you really want to continue making a lot of money in China, you need to put your best technology out there.” And then the technology gets taken and reverse engineered and so on.

The second form is outright theft.

SCISSORS: You know, you have people working with or in cooperation with American companies. And they'll just steal things, steal technology, steal ideas, steal information, and they'll bring them back to China, maybe to start their own firm up, maybe as a deal with a Chinese firm. But either way, the technology now becomes available in China, where it’s protected in the US.

And that gives the Chinese enormous advantages—both commercially and strategically.

SCISSORS: On the commercial side, if you develop a product and you spent years and you put millions of dollars into it, and I'm just like, “Thanks!” Now, you know, we’re even--except I didn’t spend any of that money. All my money can go to undercutting the price and trying to drive you out of business.

And on the strategic side, Scissors says the Chinese are looking to obtain technology they haven’t been able to develop themselves, including things like semiconductors. Taking that technology from someone else allows them to vault over the time and energy it would take to develop them on their own.

The U.S. government has called out Beijing for strong-arming U.S. businesses. But Scissors says that hasn’t made much of a difference.

SCISSORS: The Biden administration talks like it's a priority. They don't really act like it is. We have an agreement with the Chinese that coercion would ease and China would improve its laws protecting intellectual property. But the Chinese pass laws all the time. Laws don't mean anything, the only thing that matters is their behavior.

Zane Zovak says compared to Beijing’s other forms of corporate coercion, spats with Hollywood and sports leagues may not seem like that big a deal. But if the Chinese government can pressure U.S. celebrities to say what it wants, it needs to be taken seriously.

ZOVAK: It's going to be one of those things, where if it's not taken super seriously now, you know, 20, 30, even 40 years down the line, then the international world may look very different than it does now.

Because whoever controls the message controls reality.

Reporting for WORLD, I’m Josh Schumacher.

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