By Claude Barfield and William Rau

After more than 40 years of China’s “reform and opening up,” are US firms serving as checks on
the Chinese government’s totalitarian aims — as Mao Zedong once feared —
or are they becoming China’s ideological accomplices? Strategic decoupling from
China has been a top goal of two consecutive American presidents, yet US foreign investment in China is growing alongside assiduous efforts by American companies
to appease the Chinese Communist Party (CCP).

As an example, look no further than two weeks ago, when The
Walt Disney Company launched its Disney+ streaming service in Hong Kong — with
a catch. A 2005 episode of “The Simpsons” in which the family visits China was missing, ostensibly because it at one point shows a fake
sign that reads “Tien An Men Square: On this site, in 1989, nothing
happened.” Consider also the saga of Disney’s “Mulan” live-action remake. After
shooting the film in China’s Xinjiang province, the site of an ongoing ethnic genocide against Uyghur Muslims, Disney, in
the film’s credits, thanked several sanctioned paramilitary and propaganda
groups that have perpetrated and covered up the Xinjiang genocide.

The architecture of China’s “great firewall” remains
secretive and mysterious, making it difficult to know when platforms
preemptively censor content, respond to censorship requests, or have content
forcibly removed by state actors or algorithms. It is thus unclear whether
Disney+ preemptively cleansed itself of “sensitive” material or whether CCP
authorities did it for them. Still, Disney is clearly at ease with any of these
outcomes, given it has said nothing about the “Simpsons” episode and, in the
past, has actively courted partnerships with censorious and repressive Chinese
government organizations.

Disney+ remains banned in the Chinese mainland, but its Hong
Kong launch could preview eventual nationwide popularity and is only the latest
of Disney’s lucrative China exploits. Disney is continuing to produce movies in China, even when it requires
navigating sensitive political issues. ESPN, a subsidiary
of Disney, has a long-standing broadcast deal with the China-friendly National
Basketball Association and Chinese media firm Tencent, which it has weathered great turmoil
to maintain. Disney’s highly popular theme resort in Shanghai, which is co-operated by a state-owned Chinese partner firm, has
helped the company market its media products to Chinese audiences.

Why would Disney, a company that purports to care about police brutality, thank in its film credits
Chinese police organizations that brutalize unarmed minorities? Why would it
censor references to one of history’s clearest examples of police brutality on
its streaming platform? The (obvious) answer is that Disney’s expanding China
portfolio is too profitable to abandon.

The entertainment industry is not the only sector piling
into Chinese markets despite worsening geopolitical relations between the US
and China. Though aware of the economic and security downsides, Wall Street
firms are rapidly ramping up financial offerings for Chinese investors amidst
the CCP’s growing scrutiny of corporate activity — particularly foreign investment and overseas stock market listings. The list of companies
supplying Chinese clients with investment banking, securities, brokerage
accounts, and the underwriting of equity deals represents a “who’s who” of US
financial firms, including Bank of America, Blackrock, Goldman Sachs, JPMorgan
Chase, and others. All the while, these firms are treading carefully to not offend the CCP.

Given the vast number of US investments in Chinese
companies, there is a danger that Wall Street firms could find themselves in
the same moral dilemma as Disney: How do you keep track of — let alone defend —
investments tied to forced labor and other human rights violations? And how far
must American companies bend to the CCP’s aims in order to protect their
investments?

All of this is happening on top of escalating US-China
geopolitical tensions, Joe Biden’s pledge to “get tough” on China, and the continuing
arbitrary rule of Chinese President Xi Jinping. But it appears many American
businesses are ready to accept the risk.

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