American Big Business Must Stop Colluding with China

B ig corporations bribing foreign officials may be common practice in Hollywood movies. But in the real world, it is illegal and can bring hefty penalties. Just ask Goldman Sachs, which paid $2.9 billion in fines after it admitted to violating the Foreign Corrupt Practices Act (FCPA) as part of a global bribery scheme.

The law that snared Goldman and many others prohibits American businesses from supplying “anything of value” to the officials of foreign governments in exchange for business. By banning bribery, the FCPA codified common sense in federal statute. As it stands, though, the law is a far cry from being bulletproof. For two decades, American corporations operating in China have found ways around the FCPA.

To understand the scheme, it is first important to understand that doing business in the People’s Republic of China is not fair and never has been. The Chinese Communist Party (CCP) uses every lever at its disposal — economic, political, and legal — to manipulate international transactions to its benefit. Since the opening of trade relations between China and the U.S., this has resulted in countless corrupt arrangements between American businesses and Beijing. These bribes — we should call them what they are — are not usually monetary payments, so they do not fall under the FCPA’s jurisdiction as strictly interpreted. But they deeply violate the spirit of the law.

Corporate bribery in China made headlines in 2016 with the “princeling” cases. A group of American banks had hired and promoted the unqualified children of senior CCP officials to curry favor with the Chinese government. In this case, the banks’ corruption was so apparent that the FCPA applied, even though changing hiring practices is not essentially a monetary transaction.

Unfortunately, the FCPA is rarely used in this way, and the “princelings” are just the tip of the corruption iceberg. Today, a slew of America’s largest and wealthiest companies do the bidding of the CCP to protect their market share and maximize their profit margins.

Amazon, a multibillion-dollar giant that ranks as one of the world’s largest companies, prides itself on supporting woke causes in the U.S. Meanwhile, it markets outright propaganda for Beijing. One example is the book Incredible Xinjiang, published by the CCP — in coordination with Amazon’s China Books project, which whitewashes the party’s horrific genocide of Uyghurs and other predominantly Muslim ethnic groups.

Amazon officials acknowledge that “propaganda is the core of the toolkit for the communist party to achieve and maintain its success,” yet they disavow all responsibility for their actions in promoting that propaganda: “We are not making judgement on whether it is right or wrong,” maintain internal documents. If anyone risked being fooled by that pathetic line, Amazon’s decision to eliminate negative reviews of a book by Xi Jinping makes clear that corporate “neutrality” is really just rank hypocrisy.

Amazon is not the only business guilty of playing the stooge, of course. Apple signed a secret agreement promising investments and technology transfer to China. Microsoft’s Bing tailors search-engine technology to Beijing’s political standards. Tesla recently opened a new dealership in Xinjiang, helping cover up ongoing genocide there. For at least six months, YouTube deleted video comments criticizing the CCP. And Intel scrubbed a reference to Xinjiang in a supplier letter in response to Chinese backlash. The list goes on.

These actions may not be primarily monetary in nature, but they are plainly more valuable to the CCP than cash. It’s clear that the time has come to update the FCPA to account for this 21st-century form of corruption.

My new bill will do exactly that, expanding the definition of corrupt intent to include actions that excuse the genocide in Xinjiang, advance the CCP’s propaganda efforts, or “invest” in core CCP activities. Companies engaged in suspicious behavior would have to prove why their actions are truly good for business, not part of a corrupt bargain with Beijing.

Starting on Friday, the world will watch Olympic athletes compete in the shadow of concentration camps, and corporate sponsors will be sorely tempted to mischaracterize or ignore the CCP’s human-rights record to stay on Beijing’s good side. The need to crack down on corporate collusion with the CCP has never been stronger than at this moment.

It is not inevitable that American businesses should cave to the Chinese government’s bullying and endorse this genocidal regime. In a fortunate irony, corporate kowtowing to Beijing has become so brazen that we have the opportunity to fight back. What we do with that opportunity will reflect what we really value as a nation: the profit margins of an amoral corporate elite, or moral and economic integrity.