The White House Is Right to Push Back Against Discriminatory Digital Trade Policies
Tech is the engine that powers the American economy and drives U.S. innovation. Today, the U.S. digital economy accounts for more than 10% of our nation’s GDP and supports over three million American jobs. This economic growth has allowed American companies to invest billions of dollars in research and development to create innovative new products and services, which has positioned the U.S. as the global leader in emerging technologies like artificial intelligence (AI) and quantum computing.
However, in recent years, a growing number of foreign governments have erected digital trade barriers targeting American businesses that threaten U.S. economic interests and global technological leadership. These digital trade barriers include digital services taxes (DSTs) levied by more than 30 countries that target leading U.S. tech companies and siphon billions of dollars away from the U.S. economy annually. Additionally, a number of foreign countries have enacted discriminatory digital regulations that disproportionately affect American businesses — like Europe’s Digital Markets Act (DMA) — that often result in unfair fines and threaten to degrade popular products and services.
Despite the threat posed by these harmful digital regulations and discriminatory taxes, American officials in recent years have failed to push back against the growing risks to the U.S. digital economy. However, yesterday, FCC Chairman Brendan Carr took a stand for leading American companies in his speech at Mobile World Congress. He rightly pointed out that the EU’s regulatory regime does nothing but hamper free speech and innovation. His remarks coupled with a recent memo from the Trump administration show this Administration is working to ensure American companies remain at the forefront of technological innovation and competition. They have wisely taken steps to protect U.S. companies from discriminatory foreign digital trade regulations that pose a threat to American economic interests and innovation. Importantly, the memo directed White House officials to “investigate any additional countries that use a DST to discriminate against U.S. companies…and regulations that dictate how American companies interact with consumers in the European Union, like the Digital Markets Act.”
In addition to the strong message the Trump administration has sent pushing back on discriminatory foreign digital regulations, the White House memo also signals opposition to efforts to onshore policies that would endanger the American digital economy. This includes legislative efforts and competition enforcement actions targeting leading American tech companies that risk weakening competition, innovation, and economic growth in the U.S.
The Trump administration is right to push back against unfair foreign policies targeting American businesses and to avoid importing heavy-handed regulations here at home. Ultimately, the White House should continue working to protect the digital economy and support U.S. economic growth and American innovation.
