No matter who wins the election today, the next president will be faced with a series of challenging decisions in the nexus between digital technology, trade, and security. What follows are three of the “hangover” policy issues I have covered in recent months and years. The aim is to highlight, not to explore in detail.
First, the good news on 5G. The US is holding its own in the international 5G standards-setting process and is achieving some success in persuading allied governments to shun Huawei equipment in their 5G rollouts. But no matter who wins the election, the US needs a more comprehensive and centralized approach to dealing with the complex issues raised by the 5G future. As I’ve written previously, there are too many government actors in the 5G space, resulting in needless duplication and bureaucratic infighting. Take for example the still-unresolved issues relating to mid-band spectrum for 5G, with the Department of Defense (DOD) recently exploring the idea of building its own 5G network. This clearly conflicts with long-standing Federal Communications Commission moves to enhance private-sector broadband network development. There has been strong opposition from much of the private sector to DOD’s intervention, but Dish has agreed to join the effort if it goes forward.
A second example of the current confusion and lack of direction involves the absence of a policy to aid other nations in accessing alternatives to Huawei’s 5G equipment. After a long silence, the Donald Trump administration recently announced that it would provide loans to developing countries for alternative contracts with Ericsson, Nokia, and Samsung. But the details are sketchy, and, oddly, the US Agency for International Development — an agency with no experience in technology, particularly with regard to 5G — will administer the program.
The bottom line is that the US needs a strong hand at the top to coordinate 5G development with the private sector. A bill sponsored by Sens. Mark Warner (D-VA) and Richard Burr (R-NC) would provide a more solid basis for government aid. It would create a $500 million fund administered by the Treasury and State Departments to provide short-term international 5G aid and, for the longer term, would establish a $750 million fund to sponsor crucial R&D projects, including the development of network virtualization.
Huawei, Chinese tech companies, and export controls
The US has increasingly used export controls and the Commerce Department’s so-called “entity list” to ban exports of crucial equipment — particularly semiconductor chips — to Huawei and other Chinese tech companies. In August, the Trump administration added restrictions on 38 more Huawei affiliates around the world, bringing the total number to 121, to whom suppliers using US-designed software cannot export. In explaining the US action, Secretary of State Mike Pompeo cited national security threats and the “integrity of the world’s networks.” But, as the Semiconductor Industry Association (SIA) complained, the reach of the recent rules goes well beyond national security — including, for instance, restrictions that will cripple Huawei’s smartphone production and export. SIA argues that “these broad restrictions on commercial chip sales will bring significant disruption to the US semiconductor industry.”
For the purposes of this blog post, there are two questions that will need to be settled by the next administration. First, how far will the US go beyond purely national security rationales and into the realm of competitive industrial policy in dealing with Chinese technology companies? Second, how far will it push secondary restrictions on companies of US allies which might be caught in the widening export control and entity list net?
The encryption issue hasn’t gone away since the Obama administration, when then-FBI Director James Comey campaigned for law enforcement officials to be granted access to encrypted iPhones. Comey largely appealed to Silicon Valley to find an imaginative solution, but under the Trump administration, Attorney General William Barr and current FBI Director Christopher Wray have adopted a more hard-line approach. Barr in particular has assailed Apple and Silicon Valley firms for being unpatriotic and, in the case of Apple, for abetting terrorists and child sex offenders.
He has pushed for a legislative solution to force decryption of smartphones and other tech products. If President Trump wins reelection and Barr remains, the pressure for “backdoors” for law enforcement will remain, despite the fact that the technological imperatives remain: A backdoor for one means backdoors for all. The position of a Biden administration is unclear —and at this point no doubt not thought out.
There are certainly more “hangovers” in tech policy for the next president, but this should get the debate rolling.
Claude Barfield, a former consultant to the office of the US Trade Representative, researches international trade policy (including trade policy in China and East Asia), the World Trade Organization (WTO), intellectual property, and science and technology policy.
To read the full article, click here.