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Technology

Google denies Trump's 'treason' charge during Senate hearing

Search giant rejects spy intrigue and Republican claims of bias

While Google is being forced to answer allegations of treason and political bias, investors view the tempest as "background noise."   © Reuters

PALO ALTO, U.S. -- Alphabet Inc. executives denied explosive allegations that its Google unit was working too closely with the Chinese military in a U.S. Senate hearing Tuesday.

First raised by PayPal founder and Facebook Inc. board member Peter Thiel, President Donald Trump later added fuel to the accusations by using the word "treason" in a tweet Tuesday morning.

"Billionaire Tech Investor Peter Thiel believes Google should be investigated for treason," Trump tweeted. "The Trump Administration will take a look!"

Widely considered one of Silicon Valley's most outspoken supporters of President Trump, Thiel questioned whether Google's senior management had been infiltrated by Chinese intelligence in a speech Sunday to the National Conservatism Conference.

"Is it because they consider themselves to be so thoroughly infiltrated that they have engaged in the seemingly treasonous decision to work with the Chinese military and not with the U.S. military," Thiel said.

In response to questions from lawmakers on both sides of the aisle in a Senate hearing on Capitol Hill on Tuesday, Google's vice president for government affairs and public policy Karan Bhatia denied accusations of bias and treason, saying there was no evidence that the tech giant had been infiltrated by China.

Senator Josh Hawley, Republican of Missouri, brought up past cases of Google censoring Chinese search results regarding the 1989 Tiananmen crackdown, as well as other topics that China's communist government considers sensitive. Google pulled out of mainland China in 2010.

"Google has done it before," said Hawley. "How should we trust the company will not do it again in China?"

Bhatia responded by confirming that the company had halted all activities associated with its so-called Dragonfly project, a censored version of the Google search engine designed for mainland China, adding that Google had no near-term plans to return to China's search engine market.

"As we have said before, we do not work with the Chinese military," said a Google spokesperson. The company declined to comment on whether it is working with the Chinese government.

Since winning the presidency, Trump has amplified concerns held across the Republican Party and other prominent conservatives that Big Tech companies such as Google and Facebook routinely silence their voices in favor of a liberal agenda.

Now Trump is using Thiel's charges to threaten Google with a national security investigation.

His latest tweet regarding Google followed barrage of weekend tweets aimed at four Democratic congresswomen of color that the U.S. House of Representatives condemned on Tuesday as racist.

Thiel's charges have also triggered some skepticism, even within Trump's own administration.

"I meet with Google's CEO on a regular basis," Larry Kudlow, head of the National Economic Council, said in a television interview on Monday. "I think they're working for America, for our military, not for China."

Daniel Ives, managing director of equity research at Wedbush Securities, said he didn't think there was enough substance in Thiel's claims, or the questions from lawmakers on Tuesday, for the market to react.

"But it pours gasoline on the firestorm situation around Google and other tech giants," Ives said. "For now, the Street views this as background noise."

Shares of Alphabet Inc. remained stable in after-hours trading, closing at $1,153.46 on Tuesday, up slightly on the previous close of $1,150.51.

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