Government v/s Corporation

In recent times, we have seen the Chinese government take on the Big Tech companies of China aggressively, from Alibaba to TenCent. While the West tends to dismiss this as interference and power plays by a “communist” government, Anirudh Suri reminds us this clash between governments and “large, monopolistic corporations” has happened many times in history, including the West…

 

In The Great Tech Game, he points out how the Medici family of Florence controlled so much money (they were bankers) that it was more powerful than most kings and rulers of the time. In fact, the Medici family’s credibility was so high that money notes issued by them (practically a form of currency) evoked greater trust than the currency issued by the political rulers of the time. Not surprisingly then, the Medicis faced the ire of many kings and popes of the time, who tried to cut them down to size.

 

Next, he reminds us that both the Dutch and British East India Companies were so powerful that they had their private armies and colonies. Do you think, he asks rhetorically, that the Dutch and British governments of the day didn’t have problems with the power and money under the control of these companies? Eventually, as we know, India was transferred from the East India Company to the British government.

 

And more recently than that, Suri says that oil, steel, rail and telecom companies in the US wielded absolute power – think of the Rockefellers, for example. Each of them was eventually split and put on a leash by government rulings and regulations.

 

So ok, this tussle between governments and private companies is not a new phenomenon. What’s new though, writes Suri, is that in earlier times, the companies in question had money and power, but they couldn’t (and didn’t bother to) influence public opinion. Not anymore. In the age of the Internet, what you see on your feeds (Facebook, Google search results) can and does influence most people’s political views far more than any government machinery can. WhatsApp can be used to organize protests and spread rumours that can incite violence. It’s too much to expect that governments, democratic or autocratic, will let so much power lie in the hands of private companies.

 

Expect a lot of battles then between governments and Big Tech companies, says Suri. Regulations, law-suits, demands for backdoors, concerns about national security e.g. by terrorists using social networks – governments world over will use all the tools at their disposal to bring the tech companies in line. When he explains it that way, you realize this isn’t just a China-specific phenomenon.