I attended an event a couple weeks ago about global startup hubs. One of the panels was a group of four venture capitalists. I enjoyed this the most because the four of them had sharply divergent views and articulated them very well. This was very different from the typical urbanism panel, where most people generally share the same view and are simply giving their own perspective on it.
I noticed that one of the VCs had made an investment into a prominent Chinese startup that had a government granted monopoly on a form of payments. Nice investment if you can get it. Another person had Chinese LPs invested in her firm.
A third VC pointed out that in China’s state directed system, all decisions have a political dimension to them. That’s not to say that they have no commercial logic. But they aren’t necessarily purely commercial either. The boundaries between commercial and political are not as sharply drawn there as in the West.
We have read a ton of articles about Russian influence in America. But by any measure Chinese influence is a much bigger concern. It’s well known that if you aspire to do business in China, you have to do it on their terms. No one who has commercial ties to China can substantively criticize the Chinese government in any material way. That means essentially the entirety of the corporate elite of global corporations in the US and Europe are under some level of Chinese control. We see this clearly in how they endlessly hector America about this, that, and the other thing, but almost never say a peep about China, despite many things its government does that would seem to violate their professed values (e.g, Uighur concentration camps). US corporations are de facto more loyal to China than they are to the US or to their professed human rights values.
It’s the same for Chinese investments here. When Chinese LPs invest in US venture funds, contribute to US universities, etc., they obtain a measure of influence over those firms.
I’m actually more sanguine about the tech industry than many others. Going back to Paul Graham’s Cities and Ambition piece about how the goal of San Francisco is to be powerful rather than rich, the character of tech industry motivations makes them somewhat resistant to Chinese influence. The top tech people are vastly smarter than the folks in government or running most other industries. And unlike those industries, the tech folks aren’t easily bought off with a bit of short term cash. They are well aware of China’s goal to steal their tech, dominate global markets, etc. While it’s tough to compete against a sovereign government with essentially unlimited wealth, Silicon Valley is at least a worthy competitor.
Journalists too I think are another group not so easily cowed. The culture of journalism and its practices renders that industry sensitive to conflicts of interest. They may make compromises to get reporters into China, as many of them have, just as they understand that they can’t entirely eliminate access journalism. But they are doing it with an awareness of the tradeoffs they are making. And there are always going to be ornery journalists who aren’t afraid to say negative things about China, no matter how much influence that countries acquires in media. (That’s another reason the coming clash between tech and journalism will be interesting to watch).
After the dotcom crash there was a push to make everyone talking about stocks on TV and such to disclose their own position in the securities in question. Perhaps something similar should be done with China. Anyone commenting on China should disclose their own commercial and financial ties with the country, so listeners can properly evaluate what they are saying.