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Why Are We Allowing Dangerous Chinese Tech Companies To Operate On American Soil?

It’s not just TikTok and ByteDance. Chinese tech companies like Alibaba and Baidu are a major threat to U.S. national security.

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The Chinese Communist Party (CCP) is synonymous with espionage. The country’s tech companies, we’re told, give the CCP a vital edge. Companies include the likes of Baidu and Alibaba. Why, then, are both operating on U.S. soil?

Alibaba is China’s answer to Amazon. The Chinese multinational technology company specializes in e-commerce, retail, internet, and technology, to name just a few areas. The problematic company has a business presence in dozens of countries, including the United Kingdom, South Korea, Singapore, Italy, France, Germany, the Netherlands, Japan, Australia, New Zealand, and the United States. The fact that Alibaba, very much an ally of the CCP, is operating in the U.S., China’s fiercest rival, is worrisome, to say the least.

It certainly worries Charles Dunst, a fellow at the Center for Strategic and International Studies. Dunst recently wrote an eye-opening article that revolved around a rather sobering shopping experience. Earlier this year, the researcher was shopping at a CVS near his apartment in Virginia. At the self-checkout counter, he scanned for payment options; besides cash and credit/debit cards, other options included Apple Pay, PayPal, and Alipay, Alibaba’s online payment platform. This made Dunst stop and think.

In truth, American retailers have been offering the Alipay option of payment for years, all in an effort to attract more Chinese tourists. The app has at least 4 million users in the United States. Initially, as Dunst noted, the Alipay payment option was confined to luxury shops, “to capture the spending of well-off Chinese tourists.” However, the platform quickly expanded into your average, everyday American stores, like Walgreens, 7/11, and the aforementioned CVS.

Interestingly, some of the biggest cities in the United States now allow riders to pay their taxi fares using the app. As Dunst highlights, although this expansion is heavily focused on serving the needs of Chinese visitors, “Alipay’s presence at the center of ordinary U.S. commerce will expand the platform’s brand awareness among U.S. shoppers, possibly even winning a few adoptees in the process.”

In her new book, aptly titled, “Trafficking Data: How China is Winning the Battle for Digital Sovereignty,” Aynne Kokas discusses just why the expansion of companies like Alibaba in the United States should be of genuine concern to the country’s leaders. Alibaba is first and foremost a tech company. And what do tech companies love? Data. Lots of it. Similarly, the CCP also loves data, especially Americans’ data. 

Kokas, an associate professor of media studies at the University of Virginia, demonstrates how the CCP capitalizes on this data flow for political gain. A company as powerful as Alibaba can contribute greatly to data trafficking, by moving inordinate amounts of data out of the United States and back to China. This creates an environment that “not only exploits consumers,” but completely “empowers the Chinese government,” Kokas notes.

Like Kokas, Dunst believes that the United States’ failure to effectively “regulate data gathering by tech firms operating in the United States at the federal level has allowed firms from around the world to gather huge amounts of data on Americans.” In the case of CCP-backed firms, he argues, we shouldn’t be surprised if even more data ends up in the hands of those in Beijing. 

To be clear, Alibaba is very much in the business of helping the CCP. Last year, the company established a corporate CCP committee. At the company’s head office in Beijing, 30 percent of employees are CCP members.

Then, there’s Baidu, China’s answer to Google. Headquartered in Beijing’s Haidian District, the Chinese multinational technology company specializes in internet-related services and artificial intelligence (AI). China has aspirations of stealing the global AI crown, currently worn by the United States. To do this though, the CCP may have to steal even more of the United States’ intellectual property.

In its quest for AI dominance, China is looking to companies like Baidu for assistance. The fact that Baidu has a huge R&D center in Silicon Valley is more than a little disconcerting. As its LinkedIn page describes, Baidu USA’s “team of elite, world-class researchers and engineers devote their time to tackling the most challenging, change-the-world projects in AI and related fields.”

In a recent testimony before the Senate Homeland Security Committee, FBI Director Christopher Wray stated that China poses the greatest threat to our national security. The CCP, he said, “aspires to equal or surpass the U.S. as a global superpower and influence the world with a value system shaped by undemocratic, authoritarian ideals.”

Wray seemed particularly concerned about TikTok, an app that both Democrats and Republicans have been sounding the alarm on as a major security threat for years. Just this week, Senate Intelligence Committee chair Mark Warner, a Virginia Democrat, told Fox News Sunday, “All of that data that your child is inputting and receiving, is being stored somewhere in Beijing.” Sen. Marco Rubio and Rep. Mike Gallagher said they’re both introducing legislation this month to ban TikTok from use in the United States.

Wray told lawmakers that he is “extremely concerned” about TikTok’s operations in the United States, and he should be. Close to a quarter of the U.S. population now uses the app. ByteDance, the company behind TikTok, has five offices in the United States. The increased pressure on TikTok from leaders is encouraging, but we shouldn’t forget that other threats exist. The likes of Baidu and Alibaba deserve similar pressure and much more scrutiny.

Unlike previous wars, the next one won’t be decided by boots on the ground or bomber planes in the sky. It will be decided by technology, advances in AI, quantum computing, cyber breaches, data harvesting, and so forth. These are areas that China excels. The United States must wake up before it’s too late.

Allowing dangerous Chinese companies that specialize in tech to operate unsupervised across America is, at best, unwise. At worst, it could prove to be a catastrophically costly mistake. Banning TikTok is a good start, but we must take on the likes of Alibaba and Baidu as well.


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