Transcripts

The Great Firewall of China

SUSIE GHARIB: These days. U.S. media companies are coming under fire for inking Internet deals with China, deals that tolerate Chinese censorship and human rights abuses. There are hearings scheduled on Capitol Hill tomorrow for lawmakers to look at possibly changing the way American companies can do business there. Stephanie Dhue previews what`s at stake.

STEPHANIE DHUE, NIGHTLY BUSINESS REPORT CORRESPONDENT: Type in "Tiananmen Square" on Google in China, and there`s no mention of the 1989 protests and massacre. It`s part of a deal Google agreed to in order to set up servers in China. Congressman Chris Smith says that agreement is wrong.

REP. CHRISTOPHER SMITH (R) NEW JERSEY: That`s being complicit in a gross disinformation campaign, so it`s not like they are opening up. They are further closing. And I think out of a sense of obligation and ethical duty, they should have said those terms and conditions, we will not follow, we`re out of here.

DHUE: He`s also concerned about reports that Yahoo! complied with a Chinese government request for information about a dissident who was then sentenced to 10 years in prison.

SMITH: If the Nazi`s half a century ago were knocking on doors and saying, "where`s Ann Frank? We want to find Ann Frank." And people were staying, "she`s upstairs, why don`t you just go up and arrest her?" That`s exactly what we`re doing in a very sophisticated way, we being these U.S. corporations. DHUE: So Congressman Smith is drafting legislation that would restrict U.S. companies from placing servers in China, restrict what filtering technology can be sold to China, and make U.S. firms liable in U.S. courts for the consequences of their actions there. Smith has called Google, Yahoo!, Microsoft and Cisco to testify tomorrow before his subcommittee that overseas human rights. But none of the companies would agree to be interviewed on NIGHTLY BUSINESS REPORT today. In a statement Yahoo! says all U.S. and international firms operating in China face the same dilemma of complying with laws that lack transparency and that can have disturbing consequences inconsistent with our own beliefs. Business groups say U.S. companies are a positive influence in China and Smith`s legislation is the wrong approach.

MYRON BRILLIANT, U.S. CHAMBER OF COMMERCE: The Internet service providers are forces for change, they are providing information and today, we are in a better situation then we were 10 years ago and tomorrow we`ll be in a better situation than today.

DHUE: Ethics expert Lori Tansey Martens says Internet companies need to be specific about how they will handle human rights issues.

LORI TANSEY MARTENS: These are not situations that companies could not have anticipated. They should have realized things were happening and developed careful thoughtful analysis how they were going to respond.

DHUE: Experts say since Internet companies have not banded together to come up with standard policies for doing business in China, they may be stuck with having lawmakers do it for them. Stephanie Dhue, NIGHTLY BUSINESS REPORT, Washington.