The TikTok Bill Targets China’s Cultural Influence. That’s a Big Shift from the Tech War.
3 min
Congress’ new swing at social-media app TikTok might seem like more of the same old U.S.-China tech war that’s been running for several years—just that now it has come for dancing teens.
But what leading advocates of the new TikTok bill want would significantly expand the scope of the U.S. government’s interventions into the economy in the name of national security. The law would effectively ban TikTok if it didn’t change owners out of Chinese hands. The hallmark of China-focused regulation in recent years has been to keep American stuff—advanced technology, data, and intellectual property—out of the hands of the Chinese military. The TikTok bill would attempt to do something different: regulate companies’ ability to wield cultural power over Americans.
U.S.-China competition has already been hugely consequential for both countries’ economies and the world. Flows of trade, capital, information, and people between the two have fallen by 28% over the past decade, a report out today on the state of globalisation by logistics company DHL finds. The rise of industrial policy and other political interventions in markets are helping keep inflation high worldwide. Any expansion of regulation into new areas could add to that pressure.
To be sure, the bill is still far from becoming law. It passed the House today with overwhelming margins, but it must still pass the Senate and be signed into law by the president. Its advocates make a strong case that something really is new when it comes to TikTok. But given the stakes, it’s worth understanding exactly what that new thing is.
The bill’s leading advocates want it for two reasons . One, they argue TikTok is effectively a vast data-collection tool that can hand information about Americans directly to the Chinese Communist Party, whose requests TikTok’s management can’t refuse. This is a familiar issue in tech regulation. It is also why U.S. government employees aren’t allowed to keep the app on their phones.
The other issue is more novel. This is the idea that TikTok can be used “to mobilise public opinion,” as one of the bill’s lead sponsors, Rep. Raja Krishnamoorthi (D., Ill.), put it in a hearing with the leaders of the U.S. intelligence community on Tuesday.
Many TikTok users saw a pop-up last week urging them to contact Congress about the pending legislation, and quite a few did. Doesn’t that show exactly how the Chinese Communist Party could manipulate Americans, Krishnamoorthi asked? “While I can’t speak to the specific example,” responded FBI Director Christopher Wray, “I can tell you that the kind of thing you’re describing illustrates why this is such a concern.”
Avril Haines, U.S. director of national intelligence said that she couldn’t rule out that the CCP would use TikTok just like that to intervene in the 2024 election, something the intelligence community warned about in a new public threat assessment issued this week.
The TikTok legislation would resolve that worry not by taking away TikTok’s ability to influence Americans—only a full ban would do that. Instead, it would give the government leverage to force ByteDance, the app’s parent company, to hand ownership to an American company. Americans could still be influenced— Meta , X, and other social-media companies have been the target of other foreign-influence campaigns—but they could at least be more confident U.S. enemies aren’t secretly try to push them ideas.
TikTok’s leadership doesn’t see the issues this way. It believes the legislation is intended to ban the app, not just force divestment, and says it doesn’t take orders from the Chinese Communist Party in any case. Its CEO is from Singapore, not China, and the company is working with U.S. tech company Oracle to keep its data local to the U.S.
What no one seems to dispute is that TikTok really is wildly influential. Its 170 million users care deeply about what happens on the platform.
The question Congress is raising is whether some of TikTok’s users have been manipulated. This is a version of the argument Democrats made when it became apparent that Russia tried to intervene in the 2016 election to favor President Trump. The problem with that logic, as Republicans pointed out at the time, is that it’s not clear where it leads. If a bunch of Americans vote for the wrong reasons, does that mean the election is illegitimate? That’s a dangerous road to go down.
The point of the TikTok bill is to essentially head the debate off at the pass. Let there be no questions about the legitimacy of voting, because there wasn’t any illegitimate foreign influence behind it in the first place.
As Chris Fenton, a former Hollywood executive-turned-China critic who advised the bill’s sponsors, points out in an essay for RealClearPolitics , there is some precedent here. The Federal Communications Commission prohibits control of U.S. broadcasters by hostile governments. “Why should TikTok be an exception?,” he asks.
That’s the question the Senate will have to answer, while considering the costs of a major expansion of the U.S.-China fight and the risk that calling into question the political judgment of millions of U.S. social-media users will backfire in unexpected ways.
This decision will matter for much longer than the next dance craze.
Copyright 2020, Dow Jones & Company, Inc. All Rights Reserved Worldwide. LEARN MORE
From bushland greens to valley reds, the country’s most awarded designers are proving that the best colour palette was never on a swatch card; it was outside the window all along.
The Australian leather house has opened an immersive four-day pop-up in Manhattan, unveiling its Bloom Collection and redefining what a product launch can look like.
The federal budget has rattled property investors. But the biggest mistake isn’t the tax changes, it’s the conclusion many are drawing from them.
2 min
The recent budget has forced a reckoning for property investors.
Negative gearing now restricted to new residential builds, the CGT discount gone and on paper, the numbers look different.
And many investors are responding by pivoting toward yield, prioritising cash flow over capital growth in a way that property strategists say misses the point entirely.
“The debate has shifted to yield versus growth as if they are opposing forces,” says Abdullah Nouh, founder of Melbourne-based buyers’ agency Mecca Property Group. “But that framing is itself the mistake.”
Nouh, who works with high-net-worth families and investors on long-term acquisition strategy, argues that capital growth remains the primary driver of genuine wealth creation and that the post-budget environment has made quality assets more important, not less.
The numbers make his case plainly. An additional $500 per week in rental income is welcome. A prestige asset appreciating by $1 million over a market cycle is transformative.
These are not equivalent outcomes, and portfolios built around yield at the expense of location and land value tend to generate income while wealth stands largely still.
The more nuanced shift Nouh is seeing among sophisticated investors is a move toward assets where both outcomes can be engineered simultaneously – established homes on substantial land in quality locations, where the existing dwelling can be repositioned, rental returns improved, and the underlying land value compounds independent of what sits on it.
For investors with existing equity, commercial property is also entering the conversation in a more serious way.
Prestige industrial assets, medical centres and long-leased essential retail offer income profiles that residential property in most capital city markets cannot currently match: longer lease terms, tenants covering outgoings, and greater predictability than the residential tenancy cycle.
“The investors who build lasting wealth are rarely the ones who chased yield or growth exclusively,” says Nouh.
“They are the ones who built a strategy they could sustain – one that generated enough income to hold quality assets through multiple cycles while those assets compounded in value.”
The budget has changed the settings. It has not changed the fundamentals.
The grand harbourside residence combines sweeping Sydney Heads views, resort-style entertaining and refined designer finishes with a reported $36 million price guide.
A haven for hedge-fund titans and Hollywood grandees, Greenwich is one of the world’s most expensive residential enclaves, where eye-watering prices meet unapologetic grandeur.
