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By Andrew Newton on 13 Jan, 2010 - 03:32 UTC

Well, here is confirmation that Hillary Clinton's State Department was briefed on Google's delivery of an ultimatum to China over censorship.

 

The text of the statement:

 

Statement on Google Operations in China

 

Hillary Rodham Clinton

Secretary of State Washington, DC

January 12, 2010

 

We have been briefed by Google on these allegations, which raise very serious concerns and questions. We look to the Chinese government for an explanation. The ability to operate with confidence in cyberspace is critical in a modern society and economy. I will be giving an address next week on the centrality of internet freedom in the 21st century, and we will have further comment on this matter as the facts become clear.

 

There is no indication as to whether they were briefed before the move or subsequently, but for reasons given in my earlier post I think the State Department knew perfectly well this move was coming. The allegations against China that the statement refers to are unlikely to be new to any degree, and certainly would have been known at the time of Clinton's meeting with Eric Schmidt and other CEOs last week.

 

Such meetings I am sure happen regularly with various industry heads. My point is simply that this move by Google has to be seen as a private firm coordinating its foreign policy with that of US national foreign policy. Not a new idea (think oil companies for starters) but interesting in an era of radical transparency, corporate responsibility and "Do no evil". It's also intriguing here because the move is not - as far as I can see - the kind of cynical, manipulative coordination between private and public foreign policies that we saw in advance of the Iraq war (or again, earlier oil interests), but a development that is at least hooked on a genuine issue of human rights (privacy, speech).

 

For those suggesting this is simply Google scuppering other tech companies in China because its own position is weak, I think it highly unlikely. If my main argument is correct, this move either arose out of or would have at least been mooted at the meeting of industry leaders with Clinton last week. They all face the same problems in China. Perhaps it was agreed that Google.cn would be sacrified as shot across China's bow precisely because it had the weakest commerical position of those present. If alternatively Microsoft had taken this position, what are you holding in reserve as a threat? Google.cn?

 

 

In a timely follow up to my post yesterday on whether companies need a foreign policy, Google has effectively delivered an ultimatum to China.


The ultimatum essentially says "let us provide uncensored Google in China or we will shut Google.cn". Naturally, no one expects China to accede to Google's wishes.


The background an a good analysis are provided by Imagethief here.


Imagethief does not mention the meeting between Internet business leaders and Hillary Clinton last week, and I cannot help but feel that the timing of this announcement is linked to that meeting even if there are broader events leading up to this. Eric Schmidt is simply too close to the Obama administration to do this on the fly. Certainly to China it will look like it is, and if there is one thing that was acknowledged in that meeting it is that any stand US companies take in relation to human rights in China will be viewed by China as a proxy move by the US.


While Imagethief notes and the Wall Street Journal implies that Google's eventual withdrawal from China on human rights grounds makes it really difficult for Microsoft to remain, I would be very surprised if Microsoft, the State Department and others did not already know of the move before Google dropped today's bombshell.


 

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The recent attempt to get a foundation to review its grant to a Google privacy critic suggests the company has much to learn on political engagement.

When you have that much political power that your chief executive is often seen at the side of the US president, you have to go farther than most to prove that you are using your power legitimately.

The accusations made by the privacy group Consumer Watchdog against Google Inc regarding their lobbying activities on the sale of electronic medical records may prove to be a case of smoke without fire. Google's response, however, was to approach the Rose Foundation which had given Consumer Watchdog a $100,000 grant and urge them to review the award.

Silencing one's critics is the stuff of autocracy. A better response would have been and remains to fulfil the lobbying transparency request that Consumer Watchdog has demanded of Google.
While Microsoft and Intel have announced substantial layoffs, Google has demonstrated the real meaning of prudence.

In his Theory of Moral Sentiments Adam Smith set out his understanding of three natural moral sentiments: prudence, benevolence and justice.

Prudence formed the basis of his argument in The Wealth of Nations - not to the exclusion of the other virtues he thought natural to man, but simply as a simple device for explaining his understanding of how markets work.

To many commentators, including a goodly number of economists who choose to ignore Smith's broader legacy, prudence has been stripped down to the narrower notion of self-interest, that has in turn been highjacked as a license for selfishness.

Surely three separate events this week illustrate the difference between genuine prudence, and the bastardized version.

First Intel lays off 6,000 people. Then Microsoft follows suit with confirmation of 5,000 redundancies.

By contrast, Google has just turned in a set of great profit numbers after having focused on reining in expenses during 2008.

Rather than holding out for the last over-risky dollar, then overturning the lives of thousands of bright, competent employees, Google appears to have adopted a little self-control, and will in this recession actually be adding some staff.

As Chief Financial Officer Patrick Pichette is quoted as saying in the linked article "There's no sense in not being prudent".

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