James McGregor

I just arrived back in Beijing after a month-long trip across the U.S. My trip started with discussions with mutual and hedge fund managers, corporate executives and Washington policymakers. It ended in Palo Alto where I talked to technology executives and then stumbled across the Chinese literary legend and social critic Lu Xun, who has been dead since 1936 but still dispenses great insights and wisdom.

China’s hacking of multinational companies has been an ongoing problem, but the cases of the New York Times and Wall Street Journal are a big enough deal to catch Washington’s attention.

When I first visited China in 1985, the country was a blur of bicycles, blue Mao suits and impatient curiosity. As my sister Lisa and I backpacked across the country, we were besieged by people of all ages who wanted to practice English and quiz us about the world beyond their borders.

So what exactly came out from behind the curtain in China’s Wizard of Oz political system today? Is the new seven-man Politburo Standing Committee a group of hardliners determined to keep the tight grip of the Communist Party on the country’s economy through monopolistic state enterprises? Or will they be making more room for private enterprise to reignite growth and give China’s restive and demanding citizenry the rapidly improving living standards that they have become only accustomed to.

China’s industrial policies have created a climate of fear among Western multinationals. Concerned that China’s innovation policies are a mandate for technology theft, but dependent on the China market, multinationals often “blackbox” their technology—meaning protect it from copycats—and the consequences may prove devastating.

One month from today, 2,000 leaders of the Chinese Communist Party will gather behind closed doors in Beijing to endorse the country’s next slate of top leaders.

As part of their rush to meet the Party’s impatient expectations for technological progress, Chinese entities appear to have become the world leaders in cyber-hacking and theft of trade secrets. Combined with anxiety about losing their technology to Chinese partners, foreign executives in China sometimes behave as if they are operating behind enemy lines. 

As part of their rush to meet the Party’s impatient expectations for technological progress, Chinese entities appear to have become the world leaders in cyber-hacking and theft of trade secrets. Combined with anxiety about losing their technology to Chinese partners, foreign executives in China sometimes behave as if they are operating behind enemy lines. 

Rapidly unfolding events in China are rattling the international business community. An economic slowdown is piling on top of propaganda-fueled anti-Japan demonstrations, spectacular corruption and crime scandals reaching into the leadership, and signs of deep divisions within the Communist Party aristocracy just a month before the China’s once-in-a-decade leadership transition.

Rapidly unfolding events in China are rattling the international business community. An economic slowdown is piling on top of propaganda-fueled anti-Japan demonstrations, spectacular corruption and crime scandals reaching into the leadership, and signs of deep divisions within the Communist Party aristocracy just a month before the China’s once-in-a-decade leadership transition.