Why Donald Trump Won’t Scare Off Silicon Valley

Singapore Prime Minister Lee Hsien Loong Attends The Official Opening Of The New Google Inc. APAC Headquarters
People ride a moving walkway in front of a sign featuring Google Inc.'s logo at the company's Asia-Pacific headquarters during its opening day in Singapore, on Thursday, Nov. 10, 2016. Google officially opened its new hub in Singapore today. Photographer: Ore Huiying/Bloomberg via Getty Images
Ore Huiying—Bloomberg via Getty Images

During Donald Trump’s presidential campaign, the president-elect was not exactly the most friendly with Silicon Valley tech giants and their policy agendas. Trump theorized that Amazon.com founder Jeff Bezos bought The Washington Post in 2013 to influence federal policies and warned the largest online commerce retailer it would “have … problems” if he became president. He also ridiculed Facebook Inc. founder Mark Zuckerberg’s pro-immigration stance. And Trump charged Google Inc. with favoring Hillary Clinton by prioritizing positive news stories about her in search results.

As Trump meets with tech’s biggest executives in New York this week, the encounter could indeed be frosty. But regardless how Trump feels, it’s unlikely he alone can stop tech from influencing some of the most critical laws and regulations affecting them.

In recent years, Internet firms and their trade associations have spent lavishly to become some of the most powerful influencers in Washington, shaping a range of policies that extend from immigration to privacy to taxes. And Trump notwithstanding, their power and influence will likely continue. Companies, such as Alphabet Inc. (Google’s parent), Facebook Inc., Amazon.com Inc., and their trade groups, such as the Internet Association, spent $50.9 million on lobbying in 2015 — more than four times what they spent in 2009, the year President Obama came into office, and up 18% from 2014, according to data compiled by the Center for Responsive Politics and the Center for Public Integrity. Campaign contributions from these technology companies, many less than 10 years old, quintupled between 2009 and 2016.

The investments reflect lessons sometimes painfully learned. Just a few years ago, America’s technology companies held a bemused disdain for Washington, which they saw as an anachronism in the emerging digital culture. But times have changed, and so have the stakes, as digital devices and apps have advanced to collect more of consumers’ personal information. So Internet companies have turned their sights and pocketbooks on Congress and additionally have involved themselves on boards and committees that inform the agencies writing oversight rules.

Facebook, a relative newcomer in Washington, has ramped up its spending from a scant $208,000 in 2009 to nearly $10 million last year, with 31 lobbyists, according to CRP. More recently, Twitter and Uber have come to Washington spending millions more. Overall, Internet companies, as the Center for Public Integrity defined them, now employ nearly 500 lobbyists in Washington — almost three times the number just five years ago — to weigh in on everything from privacy to patents to antitrust to security.

Flexing muscle

Regardless of Trump’s scorn, it’s likely tech executives will continue to influence Washington on a wide range of policies, including cybersecurity, taxes, immigration, transportation and, perhaps most dramatically, consumer privacy.

For four decades, lawmakers regularly passed bills that expanded privacy protections for consumers — about a law every two years on average. But the last to pass was in 2009, an expansion of who must protect Americans’ health information from disclosure,

In the seven years since not one major privacy bill has cleared Capitol Hill, despite unprecedented growth in social networks, advanced technology such as wearable devices and in-home monitoring tools, as well as apps that collect information that companies could use to discriminate against Americans. The post-2009 void has not been due to a lack of effort; some 92 consumer privacy bills have been proposed during the seven-year period since, according to the Center. But that period coincides with internet firms’ cascading investment in lobbying spending, along with a quintupling of campaign contributions from top internet executives and company PACs.

Steady as she goes

Veteran Capitol Hill observers believe Internet companies will likely continue to have their way.

Trump sees himself first and foremost a businessman, they say, having repeatedly boasted about his executive acumen on the campaign trail. Both Trump and Congress understand Internet companies have been powering the U.S. economy for years. And Trump, who incessantly talked about jobs on the stump, is unlikely to take actions that might retard the growth of an industry that has expanded at breakneck pace, privacy concerns aside. Revenue from selling targeted ads, for instance, is estimated to reach $33 billion by 2020, with advertising accounting for 90% plus of Google’s and Facebook’s revenue.

Internet companies, such as Google, are now evaluating their approach to the Trump administration and the Republican party. Just days after the election, Google posted a help-wanted ad for a “Manager for Conservative Outreach and Public Policy Partnerships,” who would act “as Google’s liaison to conservative, libertarian and free market groups,” Bloomberg reported. Policy experts with Google ties are also working with Trump’s transition team. Joshua Wright, who conducted Google-supported research while a professor at George Mason University just outside Washington, D.C., is leading the team looking at the Federal Trade Commission, which oversees consumer protection and anti-competitive practices. “Whatever kinship individuals at Google may have felt with this president and this administration, that will not stop them to build up a sphere of influence in the incoming administration,” said Anne Weismann, executive director of the Campaign for Accountability, a government watchdog group. “They have money and enormous power.”

Which is not to say there aren’t some nasty policy fights in the offing. There are. Republicans have been looking to kill the net-neutrality rules — which blocked Internet providers from creating faster lanes for those who can pay — the FCC passed in 2015 and defended successfully in court this year. Trump named to oversee the FCC transition net-neutrality-foes Jeffrey Eisenach, a visiting scholar at the American Enterprise Institute, and Mark Jamison, head of the Public Utility Research Center at the University of Florida, who wrote, “Net neutrality in the U.S. is backfiring.”

But on issues Internet firms care about writ large, Trump remains an enigma changing positions and making it difficult to discern his intentions. For example, on so-called H-1B immigrant visas, which technology companies heavily rely on to hire programmers, engineers and other technologists Trump has waffled. He said he would “end forever the use of H-1B as a cheap labor program” after he said “as far as the visas are concerned, if we need people, it’s fine.”

“Deals will be cut,” said Jeff Chester, executive director of the Center for Digital Democracy, a digital rights group in Washington, D.C, “This is a new political battleground here. In the initial start of the Trump administration, it’s going to be all about wheeling and dealing.”

Almost everyone comes back to this: Trump is a capitalist. And so he will aim to do what is right for corporations, whether they make widgets or search engines.

“I think the consumer is going to be the loser,” said Weismann of the Campaign for Accountability. “At his heart, Trump is a businessman, which will make it easier for corporations like Google and others to appeal to the bottom line as something to protect. That, he understands.”

The Center for Public Integrity is a nonprofit investigative journalism organization in Washington, D.C. Allan Holmes is a program manager there; Jared Bennett is the digital editor. For a fuller version of this piece, go to the Center’s site.

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