After it became apparent the US government would ultimately reject them, the Chinese telecom giant Huawei recently gave up on its attempt to acquire the American company 3Leaf. Even before the decision was announced, Chinese pundits were already loading their cannons in response to the probable rejection.
It’s hard to blame them. Huawei has been at the butt of several rejected deals in the US in recent years based on dubious national security concerns. Huawei is almost certainly a victim of American politics.
Some pundits have taken their responses too far though. A recent Global Times editorial suggested, “If the bid is rejected, China should launch retaliatory measures against US businesses over here.”
The suggestion conjured up similarities to the ancient Code of Hammurabi which had a basic “eye-for-an-eye” principle. One law stated that “If a builder builds a house for someone, and it falls in and kills its owner’s son, then the builder’s son shall be put to death.”
That law was deemed archaic some 3,500 years ago, but the suggestion that American businesses in China should be punished for Huawei’s rejection isn’t too far off the mark. Foreign business owners in China must have felt a chill go through their spine upon reading that editorial.
The suggestion makes an all too common assumption that a country is a single body where the actions and thoughts of all its people and institutions are coordinated. But being from the US doesn’t mean a business supports US government polices like the one impeding Huawei. And those companies certainly don’t have any power over the matter. These pundits are suggesting lashing out at innocent bystanders simply because they don’t see any better options.
Even if that kind of retaliation were justified, it would hardly be effective from a practical standpoint. It would probably even make things worse. The US government blocks deals like Huawei’s because, no matter how well-established and independent a Chinese company is, Americans will still see it as “China Inc.” and want it dismissed on any grounds. American leaders are happy to soak up the kudos that come with saving American jobs by expelling a seemingly red communist enterprise.
If China retaliated against American companies, it would just enhance that shady image in most Americans’ minds. They would simply call for further retaliations against other Chinese companies and, in the coming election cycle, American leaders might feel compelled to chase those cheap political points.
From China’s standpoint, it’s hard to bite this bullet and refrain from making some kind of retaliation while one of its companies is being treated so unfairly. But they should also keep in mind that China isn’t exactly a shining example of fairness toward foreign enterprises.
China requires technology transfer from foreign companies, enforces intellectual property laws far less stringently when foreign companies are being ripped off than when Chinese companies are, and the state owned media regularly takes shots at foreign companies while neglecting the problems of their Chinese competitors.
If one looks beyond business to fields like journalism, they’d be hard pressed to find an example of a Chinese journalist in America being followed, threatened, arrested, beaten or deported for carrying out their basic reporting duties in accordance with the law.
Huawei is getting a bum deal and Chinese are justified in sticking up for it. But they need to stay rational at the same time. To advocate indiscriminate retaliation against companies simply because they’re American is little different from throwing rocks through McDonalds’ windows when the US government offends China. It’s tempting to go after the easy target, but reckless and ultimately useless.