I have a lot of time for Rebecca MacKinnon. She has worthwhile things to say about China, and she's been an energetic and outspoken advocate for a more open media and Internet environment in China and a greater degree of accountability from the foreign companies that do business here. She has also just led the development of Human Rights Watch's new report (proxy link) on the complicity of foreign companies in the maintenance of China's Internet censorship regime.

I also have a lot of time for my former colleague and mentor, David Wolf, who runs Wolf Group Asia and authors the Silicon Hutong and Peking Review blogs. David has just put up a long and thoughtful post analyzing and responding to the HRW report. Among David's points is that the HRW report frames a set of choices for MNCs that look reasonable at first glance, but are, in fact, an ultimatum that leave no option but for MNCs to withdraw from China (or be thrown out):
HRW requires that Internet companies refuse to "participate in or facilitate" infringements on free speech. And yet the report itself acknowledges that this kind of behavior could result in the revocation of a business license.

The question, of course, is whether the government would actually shut down these companies. Unfortunately the only way to test that is to have one or more companies step up and actually operate according to HRW's recommendations. Since nobody wants to be the sacrificial chicken, Ms. MacKinnon proposes the modern equivalent of Russia's political kommissars standing behind ranks of soldiers ordered into battle with orders to shoot if they try to retreat. She proposes legislation to force companies to challenge the will of the Chinese government.

(Worse, she suggests that U.S. companies would only be able to hand over user data to the Chinese government in cases determined acceptable by the U.S. Department of Justice. Under no circumstances would the Chinese government find this acceptable - it is redolent of the sort of extra-territoriality provisions forced on the Chinese during the period of unequal treaties and would invite an unequivocal response.)

Here is the question: how long would any Internet company, Chinese or foreign, be allowed to operate in China if it encrypted all email, refused to turn over personal information, moved its servers offshore, and demanded a writ each time it had to block a site or filter a word?

Does anyone with experience running a real business in the PRC, Chinese or foreign, doubt that taking such actions would be perceived by the Chinese government as the electronic equivalent of aiding, abetting, and harboring criminals? Is there any question that such actions would likely irritate some fairly senior people in government? Because in a land where rule of law is in its infancy, it would not require a court order to shut the doors of even the largest Internet company. All it would take is for a small number of well-placed regulators or police officials to lose their patience with a company and the axe would fall.

Something, again, that Ms. MacKinnon does not deny. She merely implies "HRW believes" it to be possible to act according to their requirements and still operate in China.

Fair enough. I "believe" she and HRW are wrong. And nether of us will be proven right or wrong until somebody does it. Any volunteers?
There is passion on all sides in this argument. If it were a simple issue, it would have been solved already. Read the report. Read David's response. See what you think.