American Corporate Power Over the US Government

If you want to know who has the most influence in DC, study trade deals and @USTradeRep45: the most obvious manifestation of American corporate power over state. Take the #IndoPacificEconomicFramework. As @ddayen notes, it's a #BigTech wishlist:https://t.co/vq5myJeJBg

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

If you'd like an essay-formatted version of this thread to read or share, here's a link to it on https://t.co/iSBh8srvly, my surveillance-free, ad-free, tracker-free blog:https://t.co/DL0Ibx2dzf

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The USTR's playbook has changfed over the years, reflecting the degree of control over the US government exerted by different sectors of the US economy.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Today, with Big Tech in the driver's seat, US trade deals embody something called the #DigitalTradeAgenda, a mix of policies ranging from limiting #liability, #privacy protection, #competition law, and #DataLocatization.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The Digital Trade Agenda is a relatively new phenomenon. A decade ago, when the USTR went abroad to twist the arms of America's trading partners, the only "digital" part of the agenda was obligations to spy on users.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

That, and swiftly removing materials claimed to have violated US media monopolies' copyright. But as the tech sector grew more concentrated, they were able to seize a greater share America's trade priorities.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

One person with a front-row seat for this was @wendyliy, PhD candidate at @UWSoc, who served in the USTR's 2015-17, and who leveraged her contacts among officials and lobbyists (and ex-lobbyists turned officials) for a fascinating, ethnographic account of #RegulatoryCapture.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

That account appears in "Regulatory Capture’s Third Face of Power," in @SASE_Meeting. The article is paywalled, but if you access it via this link, you can bypass the paywall:https://t.co/o92B95Hi1m

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li's paper starts with a taxonomy of types of regulatory capture, drawn from the literature. The first kind - the "first face of power" - is when an industry wins some battle over a given policy, triumphing over the public interest.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li notes that defining "public interest" is sometimes tricky, which is true, but still, there are some obvious examples of this kind of capture.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

My "favorite" example of horrible regulatory capture is from 2019, when @DowNewsroom convinced the state of #WestVirginia to relax the limits on how much toxic runoff from chemical processing could be present in the state's drinking water.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Dow argued that the national safe levels reflected a different kind of person from the typical West Virginian. Specifically, Dow argued, the people of West Virginia were much fatter than other Americans, so their bodies could absorb more poison without sickening.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

And besides, Dow concluded, West Virginians drink beer, not water, so poisoning their drinking water wouldn't affect them:https://t.co/G6r2Vhih8B

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

This isn't even a little ambiguous. Dow's pleading wasn't just absurd on its face - it was also scientifically bankrupt - there's no evidence that being overweight makes you less susceptible to carcinogens. And yet, the state regulator bought it.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Why? Well, maybe because chemical processing is WV's largest industry, and Dow is the largest chemical company in the state. Regulatory capture, in other words.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The second kind of regulatory capture is the #RevolvingDoor: when an executive from industry rotates into a role in government, where they are expected to guard the public interest from their former employers.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

There's some of this in every presidential administration - think of Obama's ex-#Morganstanley and ex-#GoldmanSachs finance officials.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

But while Obama and other "normal" pols sketched their corruption with a fine-tipped pen, making the overall shape hard to discern, Trump scrawled large, crude, unmissable figures with a fisted Sharpie.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Remember @ScottPruittOK, the disgraced Trump @EPA who wanted to abolish the EPA? Pruitt was was such a colossal asshole that even the lobbyists who'd been bribing him with free housing actually *evicted him*:https://t.co/tB2EMboyuT

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

After Pruitt resigned in the midst of chaotic scandal, he was succeeded by his deputy, @AndrewRWheeler - a former coal lobbyist:https://t.co/x7eiCrUD4n

That's the "second face of power." What's the third? It's taking over the debate's *shape*, defining its axioms.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Think of the reflexive idea that government projects are "wasteful" and "inefficient." Once all players internalize this idea, the debate shifts from "what should the public sector do?" to "which private-sector entity should the government pay to do this?"

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Anyone who says, "Wait, why doesn't the *government* just do this?" just gets blank stares.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

We can see this in the cramped and inadequate debate over the #SVB #bailout; bailout apologists insist it was necessary because if SVB's depositors took haircuts, America's large depositors would pile into Morganstanley, making it even more "too big to fail..

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

This is probably true - but only if you discount the possibility of establishing a *public* bank. Public banks are hardly a radical idea: America had nationwide public banking through the postal service until 1966:https://t.co/jmDPhwaZQo

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li summarizes: "the first face of power is measured through the winner of the game, and the second face of power can be understood as the referee. The third face of power is the field, the rulebook, and agreement that there is even a game at all."

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

It's the creation of this third face that Li's paper dissects - the creation of "Type I" ideas that form the unquestioned assumptions for all other debate. Sociologist call these ideas "#schemas."

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li describes two ways that the tech industry changed the schemas used in trade negotiations. First, schemas are changed through "knowledge production" - creating reports and data.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Second, schemas are embedded through "recursive institutional reproduction" - a bit of unfortunately opaque academic jargon that is roughly equivalent to what activists call "#PolicyLaundering."

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

That's when an industry can't get its way in its home country, so it leans on trade reps to include that policy in a treaty or trade deal, which transforms it into an obligation at home.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

In tech policy, the Ur-example of this is the #DMCA, a 1998 digital copyright law that has profoundly changed the way we relate to everything from online services to our coffee makers.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The origins of the DMCA are wild. In 1991, @AlGore kicked off the #NationalInformationInfrastructure hearings - AKA the "#InformationSuperhighway" project.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

One of the most prominent proposals for the future of the internet came from #BruceLehman, @BillClinton's #CopyrightCzar. Lehman had been the head of IP enforcement for @Microsoft, and he had some genuinely batshit ideas for the internet. How batshit?

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Try requiring a separate, negotiated copyright license for every transitory copy made by RAM, or a network buffer, or drive cache:https://t.co/gIxQvVOSqx

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Gore laughed Lehman out of the room and told him to hit the road. So Lehman did, scurrying over to Geneva, where he turned his batshit ideas into the #WIPOCopyrightTreaty (#WCT) and the #WIPOPerformancesAndPhonogramsTreaty (#WPPT).

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Then he raced back to DC where he told Congress that they had to get on board with those UN treaties. In 1998, Congress passed the DMCA, turning a failed regulatory policy into a federal law that endures to this day.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

That's "policy laundering." Lehman couldn't get his ideas though the US government, so he rammed them through a UN agency, converting his proposal into an obligation, which Congress duly assumed.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The Digital Trade Agenda triumphed by both knowledge production and recursive institutional reproduction (AKA policy laundering). Under Obama, trade officials created the Digital Trade Working Group in consultation with industry, through the US Chamber of Commerce.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

This group worked with the US International Trade Commission (USITC) - a quasi-governmental research body - to produce copious reports, testimony and data in support of a focus on "digital trade."

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

In particular, they inflated the value of digital trade to US officials, convincing them that getting wins for the digital industry would have an outsized impact on the US economy.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

This is reflected in the terms of the #TransPacificPartnership, a trade deal that was negotiated in the utmost secrecy, in hotels all over the world surrounded by armed guards, where neither the press nor activists were welcome.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

TPP represented a kind of farcical wishlist for America's corporate giants, including the tech sector, and it looked like a done deal - until Trump. Trump unilaterally withdrew from TPP, so the tech industry's reps simply tacked around TPP.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

They took everything they'd wanted to get out of TPP and crammed it into the #USMCA, Trump's rewrite of #NAFTA. This makes perfect sense - corporate America's priority was TPP's policies, not TPP itself.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li's paper doesn't just document this shift, she also gives us interviews with (anonymized) officials and lobbyists who speak frankly about how this happened behind the scenes.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

For example, a Commerce official turned tech lobbyist describes how he lobbies his former coworkers:

> Sometimes, [it's like] hey, let’s grab lunch, let’s grab coffee, and catch up. And half of it is about our kids, and half of it is about this [work related issue].

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

This social coziness lets lobbyists position themselves as "stakeholders," which legitimizes - and even requires - their participation in policymaking. As a trade negotiator says:

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

> So to get your handle on a problem, you’ve got to pull the right people together, and you’ve got to sift through all the various ideas, so we obviously have a lot of regular interaction with companies [. . .]

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

> I spend a lot of time with the companies trying to understand their business model, try ing to understand how they interact with the governments in different countries, and then of course, socializing it within the building."

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Once lobbyists are "stakeholders," they get to define not just what position the US takes - they get to define which positions can even be considered. As a trade negotiator says:

> [Lobbyists aren't] coming in and spouting talking points.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

> They’re not giving us draft text because we haven’t gotten to the text phase yet. The way these meetings go is, generally we provide an update on what is happening and what approach we’re taking.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

> The remainder is usually devoted to companies talking about their particular interests, and inquiring as to whether and how their issues are being addressed in that forum."

That's not just winning the game - it's defining the rules.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li's paper is a fascinating tour of the sausage-factory and a close examination of the gunk that litters the factory floor. That said, I think there are areas where she drops policies and fights into neat categories that are much messier.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

For example, Li contrasts the rules in TPP with the rules in ACTA, the #AntiCounterfeitingTradeAgreement, a failed international treaty from 2010.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li characterizes ACTA as being an anti-tech proposal because it imposed copyright liability on tech companies, which would have raised their costs by forcing them to police their users' speech, items for sale and uploads for copyright infringement.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

But that's not quite right: ACTA was *much* broader. First, because "counterfeiting" doesn't mean what you think it does: in an international trade agreement, counterfeiting concerns itself with all kinds of totally legitimate activities.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

For example, Apple engraves microscopic Apple logos on every part in an iPhone; no user ever sees these parts.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

But Apple uses the presence of an Apple trademark on these tiny components to lodge trademark claims with US border officials in order to block the importation of parts harvested from dead iPhones, as part of the company's war on repair:https://t.co/XpTBwvv4a0

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Likewise, companies like Rolex and Cartier have national subsidiaries in countries all over the world with the exclusive license to sell their goods in each country.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

These companies then claim that, say, an official Mexican Rolex watch becomes a counterfeit Rolex the minute it crosses the US border, because Rolex Mexico doesn't have the right to use Rolex International's trademarks outside of Mexico.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Asking tech companies to police "counterfeits" isn't just about stopping knockoffs - it's about letting multinational corporations control *all* secondary markets for their goods, giving them total control over repair and used goods.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Beyond that: creating an affirmative duty for platforms to police their users' uploads and speech for copyright infringement is one of those things that not only won't prevent copyright infringement (beating filters is easy for dedicated copyright infringers).

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

It will also compromise users' speech (because filters are rife with false positives) - and hands dominance to the largest tech firms (both @Youtube and @Facebook support filters, because they've spent hundreds of millions on them, and know that their small rivals can't).

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

ACTA wasn't a way to "punish" tech and help media - it was a way to shift some of the oligarchic control of both tech and media around, while shoring up its dominance. Yes, parts of the tech sector hated ACTA, but it died because millions of *people* campaigned against it.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

And of course, ACTA got policy-laundered into law in 2019, when the EU adopted the #DigitalSingleMarket with a filtering mandate, ignoring the largest petition in EU history and the marches in 50 cities. That was recursive institutional reproduction in action all right.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Likewise, TPP can't be understood as the tech sector sidelining the entertainment companies - because both of them rallied for the parts of TPP that feathered *all* their nests.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

For example, the entertainment corps and tech both love rules against reverse-engineers (like Section 1201 of the DMCA), which make it a felony to unlock your books, music, games and videos from the store that sold them to you and take them with you to another player.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Tech loves this because it gets them lock-in - if you break up with Amazon, you have to kiss your Kindle and Audible books goodbye.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Media loves it because it gives them control - DRM stops you from recording Christmas movies between Feb and Dec, when they come free with your streaming service, and that means you have to pay-per-view them in December, when you want to watch them.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

In other words, the Big Tech and Big Content's fights aren't so much about which policies we get - they're about who profits from them. They want the same stuff - no taxes, no unions, no minimum wage, no consumer rights, no privacy - but they want to hoard the benefits.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Both tech and media love "IP" - not in the sense of "copyright" or "trademark," but in the sense of "any law that lets me control the conduct of my competitors, critics and customers":https://t.co/Ec4rY387WA

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

In USMCA, it wasn't just the "Digital Trade Agenda" that made it into the final agreement - it was mandatory DRM laws, massive copyright extensions, and the evisceration of fair use and its equivalents in Mexico and Canada:https://t.co/SeLhFoiHDc

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

There's another important factor missing from Li's analysis of the rise of the Digital Trade Agenda: #monopoly. Tech used to be composed of hundreds of competing firms that hated each other's guts and were incapable of working together.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The entertainment industry, by contrast, was already hugely consolidated and able to lobby effectively as a body.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

That was hugely important in the Napster Wars, when international copyright proposals like the Database Right and the Broadcast Treaty were popping up at the UN and in country-to-country trade deals.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

While tech was competing to give users a better deal, Big Content solved the #CollectiveActionProblem and got a common lobbying position, getting nearly identical (and absolutely ghastly) tech bills introduced in dozens of state legislatures at once:https://t.co/3uFXQ07FDu

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The rise of the Digital Trade Agenda is downstream of tech industry consolidation, the orgy of mergers that saw the internet transformed into "five giant websites, each filled with screenshots of text from the other four":https://t.co/F3Wy3bq5H9

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Li's taxonomy of regulatory capture is useful and important, and it's complimented by an analysis of failures in #antitrust enforcement. Market consolidation has produced firms that are more powerful than the governments that are supposed to keep them honest.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

When the teams have more power than the ref, the game will never be fair:https://t.co/lGtTiI4dP3

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

The tech industry aren't really adverse to the entertainment industry, at least not where it counts. They are all part of the #BusinessLobby, whose regulatory priorities are broadly shared, even if they disagree at the margins.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Dayen describes how the Digital Trade Agenda is playing out in IPEF, a treaty with more than a dozen Pacific Rim countries: "It would prohibit governments from reviewing or prescreening algorithms for violations of labor law, competition policy, or nondiscrimination.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

"It would bar limitations on data flows or storage. And it would treat policies that have greater impacts on the large tech firms as illegal trade barriers. These terms could block signatory countries from writing laws that take on any of these issues."

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

Those aren't *tech* priorities - they're *corporate*. The success of the "Digital Trade Agenda" isn't just because tech grew up and started lobbying - it's because the things they lobby for are the things every business wants: no labor protection, no antitrust, no privacy.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023

That's the "schema" that matters: that job of US trade policy is to make sure that workers and residents abroad have no rights, with the obligation on America to dismantle the few rights that remain intact in its borders to satisfy the "obligation" it actually insisted on.

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— Cory Doctorow (@pluralistic@mamot.fr) (@doctorow) April 18, 2023