The Economist - USA (2020-08-08)

8 Leaders The EconomistAugust 8th 2020

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I

ndecember 2017 a ChinesetechnologyfirmcalledByteDance

boughtMusical.ly,anappwhichletitsyoungusersdanceand

lip-synctomusicvideos.Thisdidnot,atthetime,looklikea rec-

ipeforgeopoliticalstrife.ByteDancemergedMusical.lywitha

similarappcalledTikTok,whichstartedgrowingata blistering

pace.TodayTikTokhas100musersinAmerica,andcompetes

withFacebookandSnap.Withgrowingpopularityhascome

growingscrutiny,asSino-Americantensionsspreadfromtrade

totech,anda barrageofinvectivefromPresidentDonaldTrump.

Thislookssettoculminateina forcedsaleofTikTok’sAmerican

businesstoa domesticbuyer.ToutedasvitaltoprotectAmeri-

cans’data,thecrackdownisinfacta depressingexampleofjin-

goisticopportunism,morelikelytochillinvestmentinAmerica

andstokeChinesenationalism.

The legal basis for TikTok’s divestment

comesfromtheCommitteeonForeignInvest-

mentintheUnitedStates(cfius),whichthis

weekruledthattheMusical.lydealwasagainst

America’s national-security interests.Having

flirted with banning TikTok altogether, Mr

Trumpnowseemswillingtoaccepta fire-sale.

Microsoft,an Americansoftwaregiant,is in

talkstobuyTikTok’sAmericanoperations,aswellasthosein

NewZealand,AustraliaandCanada(seeBusinesssection).

ByteDanceisthelatestina seriesofChinesefirms,among

themHuawei,a telecoms-equipmentprovider,tobetargetedby

theTrumpadministrationamidfearsofcyber-spyingandpropa-

ganda-peddling.Itclaims—withoutprovidingevidence—that

thefirmsare,orcouldbe,usedtopassAmericans’personaldata

totheChinesegovernment.ByteDancewillnotbethelastinthe

crosshairs.Lenovo,a partlystate-ownedChinesefirm,sellslots

ofcomputersinAmerica.Tencent,a social-mediagiant,owns

largestakesinvideo-gamestudioswithmillionsofAmerican

users.OnAugust2ndMikePompeo,thesecretaryofstate,sug-

gestedthatAmericamaytakeactionagainstnotonlyTikTokbut

alsoTencent’sWeChatappand“countlessmore”Chinesefirms

“feedingdatadirectlyto...theirnationalsecurityapparatus”.

ThedatathreatfromChinaisreal.Butnationalistwhack-a-

mole,backedupwithknee-jerkthreatsofexpropriation,isno

waytorespond.Theapparentdetachmentfromanyrulesorpro-

cedureunderminesinvestorconfidenceinAmericaandheaps

political pressureon technocratic bodies like cfius, which

oughttoconsidercasesbasedontheirmerits.

Americawoulddobettertostrengthentheprocessofvetting

foreigntechinvestments,andtogetitsowndataprivacyinor-

der.cfiusprobesneedtoconcludemorepromptly;takingtwo

yearstostartinvestigatingtheMusical.lydealpracticallyguar-

anteeda chaoticunwinding.Andthecommittee’spoliticalinde-

pendencealsoneedsbolstering.MrTrumpis

watchingoverTikTok’stalkswithMicrosoftasif

hewereafeudallord.Hehasevensuggested

thattheTreasuryshouldgeta cutformakingthe

dealpossible,a demandwithnoprecedent.

TheTrumpadministration shouldtighten

privacylaw.Americahasuntilrecentlybeenre-

laxed about protectingits citizens’data, and

hostiletocyber-securityconceptslikeencryp-

tion.Anewfederaldata-privacyandcyber-securitylawwould

createtransparentstandardsforhandlingAmericans’dataand

stymieforeignhackers.Thegovernmentmustalsofinda wayto

assurethequalityofdigitalproductscontainingopaquealgo-

rithms,whichshouldapplytoallfirms,wherevertheyarebased.

BillsthatdosohavelongbeenlanguishinginCongress.The

TrumpWhiteHousehasmadelittleefforttorevivethem.

Thetensionbetweenmaintainingglobaltradeandrightful

mistrustoftheChinesegovernmentisinevitable.Digitaltech-

nologies,whoseconnectednatureopensupallkindsofhypo-

theticalmeddling,areparticularlytricky.Butrushedassetsales

atthebarrelofa gunarenottheanswer.Americaneedsa re-

sponsethatislessarbitraryandcounter-productive. 7

Trumpian TikTok

Monthlyappdownloads

UnitedStates,m

10

5

0

2018 19 20

Instagram

Snapchat

TikTok

Theforcedsaleoftheappisthewrongapproach to Chinese tech

Techwars

S

o powerful wasthe explosion that rocked Beirut on August

4th that people in Cyprus, 240km (150 miles) away, thought

they had suffered an earthquake. Scores of people died and thou-

sands were injured in the blast, which left the port in ruins. The

Lebanese government says it was caused by 2,750 tonnes of am-

monium nitrate, which can be used as fertiliser or as an explo-

sive (see Middle East & Africa section). This appears to have been

confiscated years ago from an abandoned Russian-owned cargo

ship heading to Mozambique. Customs officials proposed ex-

porting the stuff, giving it to the army or selling it to an explo-

sives company—but they needed the judiciary’s approval. Their

repeated requests were met with silence. So the material sat in a

warehouse at the port.

What kind of government leaves a mountain of explosive

chemicals lying around unsafely for the better part of a decade?

The same kind that cannot agree on a budget for 11 years and that

let its central bank run a Ponzi scheme to defend its unrealistic

currency peg. The kind which is so deluded that it relies on aid,

loans and remittances, spending far more than it collects in tax-

es. The kind that is controlled by an out-of-touch elite who fiddle

and extort while the economy burns. In short, it is the govern-

ment of Lebanon—and it is in desperate need of reform.

No way to run a country

A big blast should lead to big change

Lebanon