Why are major American corporations playing along?
This is the web version of Data Sheet, Fortune’s daily newsletter on the top tech news. To get it delivered daily to your in-box, sign up here.
(Some of you were not fans of my essay last Friday about the TikTok affair. Here’s Adam with a very different view. -Aaron)
Let’s pause for a moment and consider the bizarre state of play around us.
For years, the U.S. and its allies have mostly tolerated Chinese abuse of the free-market, globalization rules of engagement. China, which used to be a small, backward economy, blatantly restricted some Western industries—notably media, entertainment, and Internet firms—while actively and lucratively welcoming other sectors, notably agriculture, heavy industry, and even iPhones.
The West complained bitterly, particularly software companies and others whose intellectual property the increasingly affluent Chinese brazenly stole or otherwise extorted. But mostly we went along with China because more companies and people than not were getting filthy rich. Barack Obama began pushing back against the Chinese, and then Donald Trump, in his inelegant, inconsistent fashion, pushed back even harder.
This brings us to the current sad state of affairs, where the leader of the free world, the president of the country most devoted to the rule of law and a values system of fairness, arbitrarily orders a Chinese-owned American company, TikTok, to sell itself. Because he said so. In other words, the U.S., frustrated by Chinese behavior, has stooped to Chinese tactics, dictating without due process how businesses should operate—shamefully and inexplicably asking for a vig in the process.
Respectable Business Roundtable types, purpose be damned, act as if this were normal and say nothing.
More, in this upside down world, the nation’s finest companies, including Microsoft and Walmart, strap on their rubber boots and lower themselves into the muck because, well, that’s where the game is being played according to the governing regime’s derived-from-one-man rules. Just how it works in China.
Reputations of otherwise well-pedigreed people lie in the balance, a common theme in Trump’s America. Ex-Disney stalwart Kevin Mayer had been ridiculed as ByteDance’s American puppet, a reference to the Chinese owner of TikTok and its U.S.-based CEO. Mayer resigned Thursday. Not the job he signed up for. Also, according to a well-placed source I spoke to, Mayer had been cut out of the negotiations to sell the company. A puppet indeed, then, and for a man known for a healthy ego it was time to go.
He at least said enough was enough.
Adam Lashinsky
This edition of Data Sheet was curated by Aaron Pressman.
