In my opinion, the best economics writer today is Tom Hazlett. He has a way with words. And good writing requires good thinking.
Tom just had a recent post on TikTok bans that was so good I didn’t want to post it as one of many on Sunday in my weekly post.
He wrote:
So President Joe Biden signed the Protecting Americans from Applications Controlled by Foreign Enemies Act of 2024, which requires the Chinese company ByteDance to respond to TikTok or see it banned. Separating the company from the operating system will solve the problem the rest a problem often blamed on TikTok: a circle that links the personal data of US users to the Chinese Communist Party. The loop has already been cut, TikTok says, because US users’ data is now stored at Oracle in Texas. That’s about as believable as those vignettes of TikTok kids, Congress retorts.
If the Congress has assets from the Communists, tell! Those Homeland Security threat assessment color charts from the 2000s are dark, relaxed, and fair. But shutting down a company just because of rumors – that’s really it is something bad imports from China.
Later:
Instead of shouting about potential threats, TikTok’s enemies should report any actual changes or breaches of trust. When it’s a crime—such as illegally sharing user data—such misconduct should be prosecuted by the authorities. However here National Security mavens often go AWOL.
New York Times reporter David Sanger, on The Perfect Weapon (2018), provides a striking context. Around the summer of 2014, US intelligence discovered that a major state actor—presumably Chinese officials—had hacked into US-based servers and stolen the data of 22 million current and former government employees. More than 4 million of these victims lost highly personal information, including Social Security numbers, medical records, fingerprints, and background checks. The US website was left unencrypted. It was such a surprising mistake that, when the crime was finally discovered, it was noticed that the outgoing data was (strangely) encrypted, an improvement that the criminals had brought out of conscience to hack stealthily.
Here’s the killer: Sanger reports that “administrators have never equaled the 22 million Americans whose information was lost — without accident.” Victims simply received a note saying “some of their information may have been lost” and were offered credit monitoring registrations. This in itself was a small trick; hacking was identified as an espionage operation because the data extracted could be sold on the Dark Web.
I was one of those 22 million. I vividly remember the anodyne letter I received from the US government. More on that in the postscript.
Here’s what I’m wondering: What is the bigger threat to the privacy of Americans: the Chinese government or the US government? The Chinese government has restrictions on what it can do with purloined private data. The US government, because it is here, has broad limits.
Hazlett concluded:
While keeping the American public in the dark about the actual breach, US officials are raising the specter of a possible breach to trample on free speech. TikTok bans are fool’s gold. The First Amendment is smart. Let’s save one of them.
On the issue of the First Amendment, I found it surprising that Senator Mitt Romney wants to ban TikTok. because he wants to limit free speech.
Here is an excerpt from the report The New Republic.
“I mean, usually Israelis are very good at PR What’s going on here? How did it happen that they—they, and us, are so unsuccessful in speaking the truths there and our point of view?” Romney it asked Blinken, apparently in disbelief that the images of Israel’s indiscriminate bombing of Gaza have sparked outrage in the United States.
Romney then explained that the ban on TikTok largely passed both chambers of Congress because of the app’s widespread coverage of Palestine.
“Some are wondering why there has been so much support for us to potentially ban TikTok or other entities of that nature. If you look at the posts on TikTok and the number of mentions of Palestinians in relation to other social networks, it is very large among the streams of TikTok. So I think that’s really interesting, and the President will have an opportunity to act on that,” Romney said.
Politicians often like to impose their motives on others. I don’t know if the main motivation for voting against TikTok is the one Romney mentioned above. But it’s pretty clear from the context that this was Romney’s motivation.
PS I wrote about this issue in August 2020. I will end with a quote:
What about the third objection to trade with China: namely, that it could use various applications to spy on Americans? And, as with the other two trade disputes with China, it is true. But in the most recent alleged case of such surveillance, TikTok, it’s hard to see how that’s a problem. In an August interview, Hoover economist John Cochrane challenged Hoover historian Niall Ferguson and Hoover national security expert HR McMaster to support their view that TikTok is dangerous to Americans. Ferguson argued that TikTok is addictive to young people. I’m sure it is, like computer games, but that has nothing to do with China.
McMaster argued that TikTok is collecting information on Americans, especially young people. I’m sure that’s true too, as Facebook and Instagram do the same with different audiences. But how does this hurt the American people in any significant way? As Julian Sanchez of the Cato Institute recently wrote:
One can imagine how such information might be abused by a government interested in monitoring its citizens, but it is difficult to explain any plausible reason why midwestern teenagers posting cat videos should fear that Maoists are manipulating system settings or geotags.
People greatly discount dancing for young women, as we learned when a video of Alexandria Ocasio-Cortez dancing while a student at Boston University was leaked. My reaction was that he was a dancer.
HR McMaster argued that the Chinese government wants to “weaponize information.” You are probably right. But how do you arm the data on, say, young women who dance? Interestingly, his best example of the Chinese government collecting information that could harm the American people was the Chinese government’s hacking of confidential government-held information of millions of government employees a few years ago. That it was seriously. But note that they do so without trading. [DRH additional note: and without TikTok.] In addition, the poor security of the US federal government made hacking easier than ever. I was a US government employee in 2015 when it was hacked and Beth F. Cobert, Acting Director of the Office of Personnel Management, wrote to tell me that my data had been stolen. Here is part one of his book:
Since you have applied for a position or submitted a background investigation form, the information in our records may include your name, Social Security number, address, date and place of birth, residence, education, and employment history, foreign travel history, information about immediate family and business and acquaintances. , and other information used to conduct and judge your background investigation.
He added, “Our records also reveal that your fingerprints may be compromised during online access.”
I clearly remember that the hacked form I filled out last year asked me if I had committed adultery in the past seven years. That was important, you see, because the US government needed to know if I could be arrested. Fortunately, my answer was no, but note that the US government has made it easy for the Chinese government to blame federal employees who answered yes.
That’s the kind of data I’d like the federal government to protect, not pictures of teenage girls.