Saturday, May 25, 2024

The Tech Hawks Took Down TikTok. Now What?

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When a group of tech executives, venture capitalists, and lawmakers representing both chambers of Congress, both sides of the aisle, and both coasts of the United States met for an exclusive dinner in Washington last March, TikTok CEO Shou Zi Chew was about to testify in front of the House Committee on Energy and Commerce to defend the short-form video app and allay congressional concerns about its Chinese ownership. The objective of the dinner was to convince the lawmakers otherwise.

When a group of tech executives, venture capitalists, and lawmakers representing both chambers of Congress, both sides of the aisle, and both coasts of the United States met for an exclusive dinner in Washington last March, TikTok CEO Shou Zi Chew was about to testify in front of the House Committee on Energy and Commerce to defend the short-form video app and allay congressional concerns about its Chinese ownership. The objective of the dinner was to convince the lawmakers otherwise.

This year’s edition of that now-annual gathering, known as the Hill & Valley Forum, was underpinned by a sense of victory and vindication. Late last month, U.S. President Joe Biden signed a law giving TikTok’s parent company, Chinese tech giant ByteDance, roughly a year to divest itself of the social media platform or face a ban in the United States. The divest-or-ban provision was tucked into a larger and far more urgent piece of legislation: the national security supplemental bill that gave $95 billion in military aid to Ukraine, Israel, and Taiwan, as well as humanitarian assistance to populations in conflict-ridden zones.

“Mike Johnson ultimately made the final decision to jam it in the Senate through the supplemental, and it ended up working incredibly well,” Jacob Helberg, the organizer of the Hill & Valley Forum, said in an interview, referring to the Republican speaker of the House. Johnson addressed the forum on Wednesday afternoon, describing the law as “breakthrough legislation” meant to “protect America’s youth and protect Americans’ data, both of which are jeopardized by that app.”

Johnson’s Republican House colleague, Rep. Elise Stefanik, had kicked off the forum’s proceedings earlier that day by describing TikTok as a “communist Chinese-controlled influence tool.”

The potential ban still has a long road ahead—TikTok has vowed to challenge the law in court, ByteDance said it has no plans to sell the app, and the U.S. presidential election in November could bring with it an additional degree of uncertainty.

But Helberg, a longtime Silicon Valley insider who has spent years championing the kind of technological decoupling from China that has now become a key facet of U.S. policy, is treating the legislative effort on TikTok as a “bellwether” for bigger policy shifts. “It’s a major victory of a battle, but the war isn’t won yet, and we’re just getting started,” he said, highlighting the dominance of Chinese drone manufacturer DJI and China’s influence over hardware supply chains more broadly as particular issues of concern.

To Helberg, who now works as a policy advisor to defense tech giant Palantir’s CEO, Alex Karp, that war is not just metaphorical. “The U.S. and China are in what I call a gray war, which is a war in the murky gray zone between war and peace,” he said. The group of lawmakers and tech mavens Helberg convenes every year “is fundamentally a coalition to win the second cold war with China.”

Hawkishness toward China has come to dominate Washington in recent years, stretching across two presidential administrations and involving lawmakers from both of the major political parties. Much of that has manifested in curbs on Chinese technology, whether it’s TikTok, semiconductors, or electric vehicles. 

That hawkishness has also made its way to Silicon Valley, the U.S. tech industry’s biggest power center, with companies and investors significantly dialing back their exposure to the Chinese tech ecosystem in recent years. Sequoia Capital, one of the biggest and most storied investment firms, spun off its China and India businesses into independent firms last year due to geopolitical tensions and amid pressure from U.S. lawmakers.

“What Sequoia Capital now represents is a firm that is based in the U.S. and in Europe, investing in the West,” Roelof Botha, the firm’s managing partner, said onstage at the Hill & Valley Forum on Wednesday. “And we really care about Western values, Western ideals, and U.S. competitiveness.”

It also represents a growing convergence of techno-nationalism between Silicon Valley and the U.S. government, which are more aligned than they have been in a long time on the national security imperatives of new technologies. 

“There seemed to be this period maybe a decade ago where Silicon Valley seemed almost resentful of the U.S. government and of military applications of technology, and I think that that has changed,” Botha said.

Helberg added that in today’s environment, Silicon Valley firms have been forced to pick a side. “I think the consensus has actually moved closer to where I am, which is that China is an adversary, we are in a technology cold war—whether we call it that or not—and that you can’t be equidistant between the U.S. and China and try to be Switzerland.”

However, there are fears that the current level of bipartisan, bicoastal consensus could lead to potential blind spots. Washington and Silicon Valley both risk getting stuck in “groupthink,” said Mark Manantan, the director of cybersecurity and critical technologies at Pacific Forum, a Honolulu-based think tank that focuses on the Indo-Pacific region.

“The conversation definitely has galvanized bipartisan consensus, but [it] also stifles further avenues to think about other solutions to really take on China,” Manantan said. “What’s the end state? There are still American companies operating in China, and they’re also in the crossfire if this relationship continues to deteriorate.”

But that momentum appears unlikely to abate anytime soon, particularly given concerns around new technologies such as artificial intelligence—the focus of this year’s Hill & Valley Forum, which Helberg and others repeatedly highlighted as the next big frontier of tech competition with China in which the United States must stay ahead. 

“I think a lot of companies would rally around providing the government with the best technology,” Karp said onstage at the forum. “There’s a whole … ecosystem of tech patriots. Quite frankly, I think we’ve embarrassed the hell out of people who took the other side, and they look like idiots.”

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