American businesses should stand behind Yahoo in standing up to China

Thursday, Nov. 4, 2021 | 2 a.m.

In an all-too-rare instance of positive news coming from Big Tech, Yahoo announced this week that it was pulling out of China.

Citing the Chinese government’s sweeping regulatory crackdown on the tech, education, gaming and entertainment industries in recent months, Yahoo said it was shutting down access to its services and walking away from mainland China.

“Yahoo remains committed to the rights of our users and a free and open internet. We thank our users for their support,” the company said in its announcement.

Yahoo was the second big American company to pull the plug, following last month’s announcement that Microsoft’s LinkedIn social network was leaving China.

More companies should follow suit. The authoritarian regime of Xi Jinping needs to face consequences for its campaign of repression across a huge swath of its society, which has drawn comparisons to Mao’s deadly Cultural Revolution. There’s even classic Communist-style propaganda to match — witness an item that was widely circulated on state media calling Beijing’s measures a “profound revolution” to end the “capitalist paradise” that had taken root in China.

Wide swaths of Chinese society were targeted. The regime banned tutors from offering lessons online and in certain other forms, decimating the nation’s multibillion-dollar private education industry. It smothered ride-hailing companies and food-ordering services, and limited the amount of time children could spend playing video games.

It eliminated popular TV shows and other entertainment — scrubbing the internet of virtually all traces of the nation’s wealthiest actress, for instance, and banning “American Idol”-style competitions for featuring men it deemed too effeminate.

The government did all of this in the name of common prosperity and “rectification,” or restoring societal norms, but it was clearly a strong-armed move by the Xi Jinping regime to reduce the growing influence of tech companies and give the government a more suffocating grip on power.

The clampdown occurs amid speculation that Xi will upend China’s longstanding system of term limits by orchestrating the retention of his position as leader of the ruling Chinese Communist Party when the national congress meets next fall.

China always censored and monitored social and traditional media through its so-called “great firewall”; now it’s dialed up its repression, with Xi preparing to extend his stronghold on the country.

All the while, Beijing used its financial leverage to demand that American companies either play along with its abuses — by helping suppress criticism over the government’s domestic oppression of Hong Kong and human-rights violations against the Uyghur population, for instance — or lose business there.

Examples include Apple being cowed into removing two apps from its App Store in 2019 that were deemed potentially offensive to the regime, including one used by protesters in Hong Kong to track police activity. Apple also pulled its Quartz news app, about which the government complained for its coverage of the dissent in Hong Kong.

Against this show of authoritarianism, it’s appropriate and responsible for companies like Yahoo to stop putting profits over social issues and leave the mainland.

Contrast Yahoo and LinkedIn to Facebook, which for years has groveled to the regime in a fruitless attempt to expand its presence there even though the company’s social media platform has been banned in China since 2009. (It is allowed to provide ad services there.)

Facebook has a history of appeasing and bowing to autocrats. A notable recent example came in 2020, when CEO Mark Zuckerberg personally decided that Facebook would comply with demands from Vietnam’s communist leadership regime to censor anti-government dissidents rather than lose the $1 billion in revenue that Facebook earns in that nation. This from a man who has presented himself as a champion of free speech in America.

Facebook’s approach in China is repellant, especially now in the face of spiraling repression.

But unfortunately, far too many other American companies and investors have stayed involved.

Those U.S. interests include the NBA, which for years has been responding to overlording by Beijing by saying, “Thank you, sir, may I have another.” A recent example came last month, when the league shivered over Boston Celtics center Enes Kanter’s criticism of China and Nike over treatment of Uyghur factory workers. Kanter’s comments prompted the government to pull the Celtics’ games from streaming platforms, but the league simply absorbed the abuse and moved on instead of supporting Kanter’s freedom of expression.

Beijing is vowing to stick with its plan for five years, indicating it is willing to absorb significant costs. Already, the regulations have wiped out trillions of dollars of market value of the country’s biggest companies.

But the more that companies like Yahoo back out, the greater the economic pressure on Xi to ease up.