In my view, the best writer on economics today is Tom Hazlett. He has a way with words. And good writing necessarily requires good thinking.

Tom recently had a recent post on the TikTok ban that was so good that I didn’t want to post it as one of many in Sunday my weekly reading post.

He wrote:

And so President Joe Biden signed the Protecting Americans from Foreign Adversary Controlled Applications Act of 2024, which requires the China-based company ByteDance to either spin-off TikTok or watch it be banned. Separating the company from the app would supposedly solve the other problem frequently blamed on TikTok: the circle linking U.S. users’ personal data to the Chinese Communist Party. The loop has already been cut, TikTok argues, because American users’ data are now stored with Oracle in Texas. That’s about as believable as those TikTok baby talk vignettes, retorts Congress.

If Congress has got the goods on the Communists, do tell! Those Homeland Security threat assessment color charts from the 2000s are tan, rested, and ready. But slapping a shutdown on a company because of mere rumors—that really is an ugly import from China.

Later:

Rather than shouting about potential threats, TikTok’s foes should report any actual mendacities or violations of trust. Where criminal—as with illicitly appropriating users’ data—such misbehavior should be prosecuted by the authorities. Yet here the National Security mavens have often gone AWOL.

New York Times reporter David Sanger, in The Perfect Weapon (2018), provides spectacular context. In about the summer of 2014, U.S. intelligence found that a large state actor—presumed by officials to be China—had hacked U.S.-based servers and stolen data for 22 million current and former U.S. government employees. More than 4 million of these victims lost highly personal information, including Social Security numbers, medical records, fingerprints, and security background checks. The U.S. database had been left unencrypted. It was a flaw so sensational that, when the theft was finally discovered, it was noticed that the exiting data was (oddly) encrypted, an upgrade the hackers had conscientiously supplied so as to carry out their burgle with stealth.

Here’s the killer: Sanger reports that “the administration never leveled with the 22 million Americans whose data were lost—except by accident.” The victims simply got a note that “some of their information might have been lost” and were offered credit-monitoring subscriptions. This was itself a bit of a ruse; the hack was identified as a hostile intelligence operation because the lifted data was not being sold on the Dark Web.

I was one of those 22 million. I well remember the anodyne letter I received from the U.S. government. More on that in the postscript.

Here’s what I wonder: Which is the bigger threat to Americans’ privacy: the Chinese government or the U.S. government? The Chinese government has limits on what it can do with purloined private data. The U.S. government, because it is here, has wider limits.

Hazlett ended with this:

While keeping the American public in the dark about real breaches, U.S. officials raise the specter of a potential breach to trample free speech. The TikTok ban is Fool’s Gold. The First Amendment is pure genius. Let’s keep one of them.

On the issue of the First Amendment, I found it striking that Senator Mitt Romney wants to ban TikTok because he wants to limit free speech.

Here’s a segment from a report in The New Republic.

“I mean, typically the Israelis are good at P.R. What’s happened here? How have they—how have they, and we, been so ineffective at communicating the realities there and our point of view?” Romney asked Blinken, seemingly in disbelief that images of Israel’s indiscriminate bombing of Gaza have prompted outrage in the United States.

Then Romney explained that the TikTok ban overwhelmingly passed both chambers of Congress because of the widespread Palestinian advocacy on the app.

“Some wonder why there was such overwhelming support for us to shut down potentially TikTok or other entities of that nature. If you look at the postings on TikTok and the number of mentions of Palestinians relative to other social media sites, it’s overwhelmingly so among TikTok broadcasts. So I’d note that’s of real interest, and the President will get the chance to make action in that regard,” Romney said.

Politicians often like to attribute their own motives to others. I don’t know that the main motivation for voting against TikTok was the one Romney stated above. But it’s pretty clear from context that this was Romney’s motivation.

P.S. I wrote about this issue in August 2020. I’ll end with an excerpt:

What about the third objection to trade with China: namely, that it can use various apps to surveil Americans? Again, just as with the other two objections to trade with China, it’s true. But in the major recent alleged case of such surveillance, TikTok, it’s hard to see how that’s a problem. In an August discussion, Hoover economist John Cochrane challenged Hoover historian Niall Ferguson and Hoover national security expert H.R. McMaster to back their view that TikTok was dangerous for Americans. Ferguson argued that TikTok is addictive for young people. I’m sure it is, just as computer games are, but that has nothing to do with China.

McMaster argued that TikTok is collecting data on Americans, especially young people. I’m sure that’s true also, just as Facebook and Instagram do the same with different audiences. But how does this hurt Americans in any important way? As Julian Sanchez of the Cato Institute wrote recently:

One can imagine how such information might be abused by a government interested in monitoring its own citizens, but it’s harder to articulate any coherent reason midwestern teens posting cat videos should be fearful that Maoists are scrutinizing their system settings or geotags. 

People cut a lot of slack for dance performances by young women, as we learned when a video was leaked of Alexandria Ocasio-Cortez dancing while a student at Boston University. My own reaction was that she was a heck of a dancer.

H.R. McMaster argued that the Chinese government wants to “weaponize data.” He’s probably right. But how exactly do you weaponize data of, say, young women dancing? Interestingly, his best example of the Chinese government scooping up data that could hurt Americans was the Chinese government’s hacking the confidential government-held data of millions of federal employees a few years ago. That was serious. But notice that they did that without trade. [DRH additional note: and without TikTok.] Moreover, poor security by the U.S. federal government made the hacking easier than otherwise. I was a U.S. federal employee in 2015 when the hacking occurred and Beth F. Cobert, Acting Director of the Office of Personnel Management, wrote to tell me that my data were hacked. Here’s one excerpt from her letter:

Since you 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, residency, educational, and employment history, personal foreign travel history, information about immediate family as well as business and personal acquaintances, and other information used to conduct and adjudicate your background investigation.

She added, “Our records also indicate that your fingerprints were likely compromised during the cyber intrusion.”

I clearly recall that the hacked form I filled out the year before asked me if I had engaged in adultery in the last seven years. That was important, you see, because the U.S. government needed to know if I could be blackmailed. Fortunately, my answer was no, but notice that the U.S. government  had made it easier for the Chinese government to blackmail federal employees who answered yes.

It’s data like that that I would like the federal government to protect, not pictures of young girls dancing.