The power of authoritarian hush money
Illustration: Aïda Amer/Axios
The same American CEOs and celebrities who publish bold op-eds and stand up for social issues in the U.S. are playing censor for Beijing and cozying up to the Saudi royals.
Why it matters: Never before has authoritarian governments' ability to silence America's rich and powerful been so starkly on display.
The latest: China has been twisting the NBA's arm over a single pro-Hong Kong tweet from Houston Rockets general manager Daryl Morey.
- The threat of losing access to the massive, lucrative Chinese market has pushed the NBA, Morey and even basketball superstar LeBron James to bend to the Chinese Communist Party. And China went as far as to ask the NBA to fire Morey, Commissioner Adam Silver said.
The big picture: It's not just China. American companies have long ignored attacks against democratic values in authoritarian countries that are willing to shell out for their products or services.
The American intelligence community acknowledges that the Kremlin interfered in an American presidential election and committed a nerve agent attack on British soil. But American corporations still maintain strong ties to the regime, even though the U.S. has had sanctions in place against Russia since 2014.
- Companies like Boeing, Ford, and McDonalds all consider Russia a big growth market, per Reuters.
- McKinsey, along with Paul Manafort, was paid to clean up the image of the pro-Russian Ukrainian politician Viktor Yanukovych, who decried the West and was convicted of financial fraud, reports the New York Times.
- “They don’t want to alienate regimes, or they would lose business," David J. Kramer, a former assistant secretary of state, told the Times.
Journalist Jamal Khashoggi was murdered by the Saudi royal family, but it's business as usual between U.S. companies and the Saudi government.
- The Saudis are the biggest customers for American weapons and the biggest source of capital for Silicon Valley startups.
- Wall Street is still vying for the IPO of Saudi oil giant Aramco — a deal that could be worth up to $2 trillion.
But no country has pushed American people and companies around like China.
"China is in a different category from anything else — and maybe anything else in world history — because there's never been such a fiercely authoritarian regime that had such overawing market power," says Larry Diamond, a senior fellow at the Hoover Institution. "We're effectively losing our 1st Amendment rights because of an external power."
- U.S. firms are not just doing business with China despite its human rights abuses — they're policing speech and expression to bend to Beijing's will.
- The list is almost endless. The American companies who have apologized to China or censored themselves to please the Chinese Communist Party include Apple, Marriott, the Gap, all three big airlines, shoemaker Vans, gaming company Activision Blizzard, and the NBA.
What to watch: China is only getting richer and stronger. Says Diamond, "We're just in the early stages of this."