Silicon Valley doesn’t know where to look in the 2020 Presidential race

Traditionally Silicon Valley has supported Democrat Presidential candidates but, with the resident internet giants increasingly becoming a political punching bag, this might change very quickly.

More specifically, Silicon Valley tends to lean towards ‘progressive’ Democrats. Many of those who would want to be included in this list have been running events in California recently to woo voters and potential donors alike, but these are candidates which have not been friendly to the internet giants in recent months.

Some of those who would call themselves ‘progressive’ Democrats include California Senator Kamala Harris, Massachusetts Senator Elizabeth Warren and New Jersey Senator Corey Booker, all of which have made moves against the technology giants for varying reasons. Harris and Booker have sponsored or supported bills which would place greater scrutiny on acquisitions, while Warren made the outlandish promise to break-up big tech and reverse certain acquisitions.

While Warren’s promise might end up meaning very little, we suspect there is too much of a focus on popularity instead of practicality, she has been the focal point of some criticism. Texas Representative Beto O’Rourke, another confirmed candidate, poked fun at Warren’s approach instead suggesting the digital economy should be more tightly regulated, avoiding the difficulties of breaking up incredibly complex, private organizations.

The prospect of new regulations is certainly a better option for the internet giants than Warren’s alternative, however O’Rourke is a bit of a difficult horse to back right now. Looking at O’Rourke’s website, it offers little (in fact, zero) insight into potential policies, but if you want to buy a t-shirt this is the place to go.

Of course, regulatory reform is top of the agenda for many of the potential candidates, and the technology industry is a hot topic here as well. Let’s start with the positives.

The majority of the candidates on show were supporters of net neutrality, battling against FCC Chairman Ajit Pai’s mission to undo the protections. Of the potential candidates, Washington Governor Jay Inslee might steal the crown here.

California might have grabbed the headlines for introducing localised net neutrality rules, potentially paving the path for a constitutional crisis, however it was Inslee who was the first to put pen to paper. Washington’s localised net neutrality rules were introduced in March 2018, six months ahead of California.

More positive news focuses on the Lifeline Program, an initiative which helps poorer families access broadband options. This is another area which felt the fury of Pai’s administration, though several of the candidates opposed the cutting of funds. Warren, Vermont Senator Bernie Sanders and New York Senator Kirsten Gillibrand are three candidates which would support the Lifeline Program.

Former Maryland Congressman John Delaney is another who would want to shake the infrastructure game up. Sticking with the rural digital divide, Delaney is proposing the formation of an Infrastructure Bank, with funds of $50 billion, to help close the virtual chasm. This might sound attractive, but Delaney shares the same anti-China rhetoric as President Donald Trump. And that has been working out really well.

Should one of these individuals win the keys to the White House, the FCC could be in-line for yet another shake-up.

Now onto the negative side of regulatory reform. The privacy and data-handling activities of the internet giants have come under a lot of scrutiny and criticism over the last few months. This is unlucky to change, and perhaps will become a lot more aggressive as politicians search for PR points. This is a popularity contest after all.

Almost every candidate is calling for more regulatory reform, pulling down the curtain which hides the data machine fuelling the sharing economy. No-one who is involved in the data sharing economy, internet giants and telcos alike, want too many of these practises exposed as it would lead to public backlash. The industry has allowed the education of the general public to fall too far behind technological developments; any bold revelations will be scary.

Two candidates are setting themselves out from the pack with bold regulatory change, Minnesota Senator Amy Klobuchar and tech entrepreneur Andrew Yang.

Klobuchar’s idea is to introduce a digital dividend on participants of the sharing economy. A levy would be placed on any company which transfers personal data to a third-party, penalising those who monetize data. Those who collect data and use it internally, current or new product development for example, would not be included in the tax.

Yang on the other hand is perhaps proposing the most revolutionary idea; Universal Basic Income (UBI). Effectively, every person over the age of 18 in the US would be entitled to apply to receive $1,000 per month. Yang claims one in three jobs is under risk from automation and AI, therefore the money will help people compensate for this.

The UBI would be funded by consolidating all welfare payments for efficiencies, a new value added tax (VAT), new revenues through increased consumer disposable income and improvements to other areas such as healthcare. However, we suspect this would not cover the outgoings, so it would not be unfair to assume a tax would be placed on those companies benefiting from automation.

Another development mid-way through last year was an attack on the state sales tax regime which the eCommerce giants have enjoyed for so long. These rules would effectively end tax avoidance benefits so many national players have enjoyed by locating head quarters in states like Delaware. Gillibrand, Sanders, Warren and Klobuchar were Senators to voted in favour of the state led digital sales tax.

What is worth noting is policies are still in their early days, and the genuine lobbying from industry will not have started yet. Who knows what the headline policies will be in the run-up to the 2020 Presidential Election, but the Democrats aren’t looking as Silicon Valley friendly as previous years.

Democrats eye up Bill of Rights for the Internet

With Silicon Valley seemingly not doing enough to empower the consumer in the digital era, Congressman Ro Khanna is working on new proposals to more tightly regulate the technology industry.

Congressman Khanna, the Democratic representative of California is suggest a new Bill of Rights for the Internet, which would provide more rights for the consumer in controlling how personal information is collected, transferred and utilised. The aim here is simple; pull the balance of power over to the side of the consumer.

While this does sound like a logical idea, the technology industry has largely slipped through the legislative grey areas for years, before such proposals could even be considered the Democrats would have to win the November mid-term elections.

The idea for the Bill would focus on the following principles. Individuals should have the right:

  1. To have access to and knowledge of all collection and uses of personal data by companies;
  2. To opt-in consent to the collection of personal data by any party and to the sharing of personal data with a third party;
  3. Where context appropriate and with a fair process, to obtain, correct or delete personal data controlled by any company and to have those requests honoured by third parties;
  4. To have personal data secured and to be notified in a timely manner when a security breach or unauthorized access of personal data is discovered;
  5. To move all personal data from one network to the next;
  6. To access and use the internet without internet service providers blocking, throttling, engaging in paid prioritization or otherwise unfairly favouring content, applications, services or devices;
  7. To internet service without the collection of data that is unnecessary for providing the requested service absent opt-in consent;
  8. To have access to multiple viable, affordable internet platforms, services and providers with clear and transparent pricing;
  9. Not to be unfairly discriminated against or exploited based on your personal data; and
  10. To have an entity that collects your personal data have reasonable business practices and accountability to protect your privacy.

Of course, many of these principles are ideas which should have been implemented before the internet ball got rolling. Now it is travelling at such a speed it might be difficult. Another factor to consider is the power of the internet giants. These are massive organizations, with heavy-hitting financial punches and an influential lobby. They won’t like the idea of such principles being written into law, so expect some notable resistance.

But first, to even consider such proposals, the Democrats would have to win the mid-term elections. All 435 seats in the House of Representatives are up for election, though 147 and 182 seats are considered safe for the Republicans and Democrats respectively. A further 51 will probably be won by the Republicans and 10 by the Democrats. The interesting battles are the ones which could go either way; 42 of these are currently held by the Republicans and 3 by the Democrats. A majority here has been set as a target, though to pass any new legislation, the Democrats would also have to win the Senate over.

In the Senate, 35 out of the 100 seats are being contested. Three of the contested seats are considered safe for the Republicans and 14 for the Democrats. 2 will probably be held by the Republicans and 8 probably held by the Democrats. 8 seats, four of which are held by either party, could go either way. Here it still looks like the Republicans will maintain control, dampening the potential for any new technology regulations.

The internet giants should have more regulations dictating the field of play, though with the current political landscape it does look like that will be difficult. Even if the Democrats win in the House, a scenario which some believe to be realistic, a Republican Senate will mean gridlock for future legislation.