Communist China cracks down on Internet companies

By Lisa S. Dean
web posted October 16, 2000

Reuters News reported recently that Communist China is cracking down on Internet companies, imposing strict regulations such as requiring Internet companies to monitor the whereabouts of Internet users and holding the companies responsible for filtering out illegal content so that users can't access certain online industries that Beijing doesn't like.

Pardon the pun but this sort of thing is a foreign concept here in the US where we have always prided ourselves on being a strong, free, capitalist country where industry isn't strong-armed by strict authoritarian big government regulations, as is the case in Communist China. Also, traditionally the Republican Party has been a stronger advocate of free market economics and pro-industry than has the Democratic Party. So it's puzzling when a Republican member of Congress takes the same position as China on the issue of government strong-arming industry, requiring Internet companies to filter out certain online industries and monitor the whereabouts of their subscribers online to make sure they are in accordance with the law.

Bob GoodlatteRepublican Congressman Bob Goodlatte of Virginia has continued to push for a vote on his bill H.R. 3125 "The Internet Gambling Prohibition Act", a bill that doesn't actually prohibit Internet gambling, but instead allows certain sectors of the gambling industry to use the Internet for the purposes of its own expansion. If that isn't bad enough, the bill also has an enforcement provision that requires credit card companies and banks to monitor your accounts looking for any gambling activity that you might have engaged in. If the company or bank finds that you have gambled online, Goodlatte's H.R. 3125 would mandate that the credit card company or bank close your account.

The Goodlatte proposal, of course, sets a terrible precedent for expansion in to other industries that the federal government doesn't like, such as online gun purchases from legitimate licensed firearms dealers or any other industry that the government doesn't like. It could also include an expansion of the definition of gambling to include day trading or online auctions, much like the Communist Chinese government is doing.

The Chinese government has instituted Internet Content Providers who control the content and information allowed to be posted on Chinese websites. If H.R. 3125 is passed into law, this country will witness the first in a long line of content controls on the Internet by the federal government. It's not a leap to envision Internet Content Providers here in the US, deciding what online information we can see and what we cannot. I believe we have something like that already and it's called CNN, NBC, ABC, CBS . . . you get the point.

The bill, if passed in to law, would also change the role of U.S. banks and credit card companies from merely being institutions where you keep or borrow your money to ones that regulate how and where you spend your money and prohibit you from spending your money in certain places.

The Chinese government has turned Internet Service Providers in to an arm of law enforcement, monitoring Internet users' whereabouts to make sure they aren't going to the websites that the government has outlawed. Interestingly, that same provision was in Goodlatte's H.R. 3125 but he was forced to remove it because of such strong opposition by the high-tech industry. Now the provision currently in the bill transforms bank officers in to police officers, much like last year's "Know Your Customer" banking proposal would have done.

But even more than resembling a regulation in Communist China, H.R. 3125 also changes an American tradition of being able to spend your hard-earned money on whatever you wish and no bank could prohibit you from doing so. If the Goodlatte bill passes, you can still spend your money anywhere you like, but if you spend it in a place that Rep. Goodlatte disapproves of, your credit card or bank account will be closed. And another American freedom taken away.

Rep. Goodlatte is fond of portraying himself as the most Internet-friendly member of Congress. "Mr. Internet." In previous years he sponsored the "Security and Freedom through Encryption Act," or SAFE Act, an attempt at lifting the export regulations on encryption software, it would have been possible for computer users to protect their private, personal correspondence and online activities from government snoops and surveillance. Then came "The Internet Freedom Act" that would have attempted to keep the Internet "open to fair competition" and "free from government regulation."

Now, curiously enough, during an election year, he's sponsoring "The Internet Gambling Prohibition Act," in direct conflict with the principles he has been supposedly committed to all along, not to mention the principles, which, as a Congressman, he took an oath to defend and protect. But silly me, I thought ignoring oaths, betraying principles and allying oneself with the Communist Chinese was limited to our executive branch.

Lisa Dean is Vice President for Technology Policy at the Free Congress Foundation.

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