In January, when Google announced that it had been the target of sophisticated cyber-attacks from China, and that it would no longer self-censor its Chinese site, the company was making both a statement and a decision. The decision was clearly to leave China—anybody who has dealt with the government knows better than to kick off a negotiation with a public accusation. If Google had hoped to maintain its Chinese operations, and work through any differences, it would have negotiated quietly, the way most foreign businesses do. But Google must have decided that it was no longer willing to make the compromises necessary to function in the country. Their announcement wasn’t a negotiating ploy, or a business tactic—instead, it was the rarest thing in corporate America, a moral statement that has nothing to do with making money.

Two months later, Google has closed its Internet search service in the mainland, and over the course of this dispute we’ve learned nothing new about China. At any time over the past decade, the Chinese government would have responded to such a situation in exactly the same way. The Google conflict doesn’t reflect new sensitivities, or a different way of handling foreigners. China remains, after all, a one-party state that has always been incredibly sensitive about anything that might be perceived as a threat or an insult from abroad.

But the conflict does reveal something important about Google. Sergey Brin, the company’s co-founder, has said that from the beginning his background as a Russian émigré made him reluctant to set up operations in China. In particular, childhood memories from the Soviet Union have influenced his response to the current issue. China has “made great strides against poverty and whatnot,” Brin recently told The Wall Street Journal. “But nevertheless, in some aspects of their policy, particularly with regard to censorship, with respect to surveillance of dissidents, I see the same earmarks of totalitarianism, and I find that personally quite troubling.”

The problem with viewing China from the outside is that it’s hard to find an appropriate lens. The American perspective certainly doesn’t prepare somebody for today’s China, but neither does the Soviet experience. And perhaps a move from the Soviet Union to the United States makes it particularly hard to grasp the strange entity that is today’s China. “Totalitarianism” is not the right word; China’s current form of authoritarianism is a world apart from Mao or Stalin. “Whatnot” might be more useful—when Brin speaks of China’s strides against “poverty and whatnot,” he touches on the great gray zone that has occupied the energies of most citizens over the past two decades. The whatnot includes vastly improved literacy, unprecedented freedom of movement, the ability to start businesses and change jobs, and the sudden availability of cell phones and Internet. But it does not include political freedom by any definition of the term. This is one reason why China is such a difficult place to do business, or even to analyze accurately: it’s hard to define what it is, and even harder to tell where it’s going.

It’s also a challenge to track progress and figure out the role of a company like Google, especially in restricted form. After I heard about the closing of the Chinese site, I called a former student named Willy; back in the mid-nineties I taught him English. Willy’s parents are illiterate farmers from Sichuan province, deep in the interior, but their son excelled as a student, won a college scholarship, and then migrated to the southeast. Nowadays he lives in the booming coastal city of Wenzhou, where he teaches at a private school and earns an excellent salary. He’s also extremely well informed by provincial standards. He reads the Chinese press, and he listens to the BBC and Voice of America on shortwave radio. He’s much more intellectually active and questioning than the average young Chinese, but there are plenty of others like him, who know how to skirt the Chinese firewall when they need to. These people constantly find and evaluate new sources of information, and they recognize that no single outlet is perfect. In the past, Willy used both Google and Baidu, the most popular search engine in China.

When I called, Willy told me that he was upset about Google’s closing, because even the censored version had benefits. “For people who know a little bit of English, I think it’s a big problem,” he said. “If I want to do a search that uses some English phrase, I always use Google. When I do Baidu it comes out with nothing useful for me. But Google will find something. For example, recently I googled [former premier] ‘Jiang Zemin’ and there were a lot of articles, and many of them were sensitive. But when I did Baidu, I got nothing.” He continued, “If Google leaves the Chinese market, then Baidu will be number one. There’s no competition, and that’s not a good thing. If Baidu is here with Google, they will compete against each other; they’ll have better service.”

He said that most of his friends and colleagues don’t understand the issues behind Google’s closing, because the real reasons haven’t been reported in the Chinese press. “Some people think that Google did something with pornography,” Willy said. “I’ve heard that from many people, including one of my fellow teachers here. He said that Google did not control the pornography, which made the Chinese government angry. He’s a teacher; he’s educated. Quite often he used Google in the past.” Willy said that these misunderstandings are common, and I heard the same thing when I contacted other friends in the provinces. One college instructor in Chongqing told me that frankly he had no idea why Google had left. “Is it because of intellectual property rights?” he asked. “Or is it because Google is a U.S. government-supported company?”

Such confusion means it’s hard for Google to make an effective statement, and it’s even harder for a Chinese citizen to figure out his role in the great gray zone. Most individuals have learned to maintain a narrow focus, trying to improve their own lives without worrying about the bigger picture. Even somebody like Willy, who has become skilled at negotiating the different forms of available information, generally avoids any kind of political activity. In the decade that I’ve known him, there’s been only one exception: a few years ago, he anonymously faxed a provincial television station to report a leak in the education bureau’s standardized high-school entrance exam. The leak had led to widespread cheating, but because of Willy’s tip, the TV station ran an exposé that inspired a crackdown on corruption in the local education system. But other than that single moment of activism, Willy has by choice remained completely uninvolved. I have no idea if that will change in the future, just as I have no idea when China’s political system will start to shift, or when the government will begin to relax its control over information. But I sense that inevitably it will happen, and whenever it does, Google probably will not be well positioned to play a significant role in the process.

As a personal decision, Google’s stance toward China is admirable, because the company turned down profits in order to make a statement. And it’s an effective way for Sergey Brin to express valuable lessons that he learned during the past in the Soviet Union. But his statement might have less relevance to the China of today and especially to the China of tomorrow. It reflects a frustration that is common among more idealistic foreigners, who have always hoped to provide a guiding light to the Reform years. By now it’s obvious that the Chinese reality is far murkier—all that whatnot, the great gray zone of personal improvement without political advancement. And the country has shown a strong and stubborn tendency to resist following any political model imported from abroad. Outsiders might have a great deal of influence, but it’s often indirect; foreigners can provide key tools, but the Chinese are determined to figure out how to use them on their own. And now, when it comes to the Internet, there’s one less tool out there.