Privacy hawks are learning to live with compromises. The Senate isn’t.
Hello, and welcome to Protocol Policy! Today, I’m delving into how privacy advocates are learning to stop worrying and love the ADPPA. Plus, what Washington can and can’t do about Amazon buying One Medical, and Zuck getting deposed.
Last call to cover all?
A House committee advanced its latest version of the bipartisan privacy bill to the floor this week, prompting applause from assembled lawmakers. The American Data Privacy and Protection Act has gone further than any online data-protection bill, ever — mostly thanks to some real compromises on both sides of the aisle. Horse-trading always creates a risk for legislators that they’ll lose crucial outside support. Political reality, though, seems to be giving some big consumer, kids’ and civil rights groups an appetite to take what they can get — and to step back from lawmakers who are holding on to hard-line stances.
The newest version of the bill, which already goes beyond privacy to address civil rights and algorithmic harms,expands private lawsuits, limits pre-dispute arbitration and gives California regulators some recognition, while also doing more to exempt small businesses and limit AI impact assessments.
- Arguably, it represents more Republican concessions to Democrats than the other way around.
- That may be why the reactions of some prominent outside groups, such as Consumer Reports and the Lawyers’ Committee for Civil Rights Under Law, ranged from cautious optimism to outright support.
- Like all good advocates, these groups are basically supposed to keep the goalposts moving for more protections a little longer than the compromisers in Congress want them to, but at this point, the groups seem ready to wind down their cajoling and encouraging.
They haven’t necessarily stopped pushing for tweaks, but many of the groups have at least let on that they’d put in an order of celebratory Champagne if Congress passes the bill as is.
- To be clear, the measure genuinely offers a lot of protections that don’t exist right now and that, until recently, seemed impossible to get in any bill with a real chance of passing.
- The good feelings from privacy hawks are broad, but certainly not unified, and there are still criticisms about protecting first-party ad giants, the effect on telecom law and more — plus worries from industry.
But overall, outside groups seem to feel they’re getting near the final offer.
- A Republican takeover of the House next year is extremely likely, and the midterm election season will mostly smother the work of legislating for several weeks starting soon.
- Some of the concessions the GOP is making could stick around: The Republican negotiators are well aware they’ll have a better hand soon, which suggests they’re serious about the offers.
- Many of the deals that Republicans have cut, though, simply expire at the end of this Congress, and it could easily be half a decade or more — depending on the political pendulum in Congress and the White House — before consumer groups get anything approaching the chances they have now.
This leaves Democratic lawmakers who are standing in the way of the bill in an awkward spot, ostensibly holding out in the name of principles that advocates say have been satisfied or superseded.
- Take preemption of state statutes: Privacy groups spent years trying to protect California’s strict rules, but Republicans signed on to ADPPA because it stops the states from elaborating in some key ways.
- Now, though, consumer and civil rights experts are singing a chorus about not letting the perfect be the enemy of the good — and some serious analysis argues the would-be federal law is actually stronger than California’s approach.
- That took away some of the heft from California lawmakers’ criticisms that the bill was too weak, and left them defending the parochial interests of one state and its hypothetical future policy innovations.
It also puts the ball in the court of Senate Commerce Committee Chair Maria Cantwell, who more than any other lawmaker can stop the measure from advancing, and has done so.
- Her criticisms are similar to those of the Californians: too few protections, too little deference to states and worries about arbitration clauses — all of which the new House version is trying to assuage, and on which the pressure from the left is receding.
- Cantwell and other Democratic skeptics may simply be holding out for an even better deal. She’s been negotiating, and periodically walking away, for years, but time does seem to be running short for that.
Of course, getting the privacy, kids’ and civil rights rights groups more or less on board doesn’t guarantee the bill passes. The happier they are, the more worried the industry becomes. The clock is ticking, higher legislative priorities are slowing and the California delegation is so big it might be able to sink the thing by itself. This time, though, if the bill does go down, privacy hawks might be genuinely sad.— Ben Brody (email | twitter)
Amazon wants to expand further into health care; it bought boutique primary care provider One Medical for almost $4 billion. Sen. Amy Klobuchar is hoping the FTC will dig in on potential competitive concerns, and the agency may well do so, because it’s already investigating Amazon. The transaction, though, doesn’t obviously throw up barriers to competition in the sector. Now if only there were some non-antitrust effort in Washington to protect consumers’ and patients’ digital data that might assuage all the privacy concerns this deal raises …
Commerce Sec. Gina Raimondo presented a doomsday scenario on chips. As part of her bid to push Congress to pass the $52 billion in semiconductor fabrication funding, Raimondo opined on the hypothetical scenario in which Taiwan cuts the U.S. off from chips: “It’s a deep and immediate recession. It’s an inability to protect ourselves by making military equipment.”
Commerce has been looking into Huawei since early 2021, according to Reuters. Though Huawei has already been investigated and sanctioned by the FCC, the Commerce probe could result in even greater restrictions on the company. The investigation centers on allegations that Huawei could use its equipment to relay sensitive military information from U.S. bases back to China.
The FCC is telling network operators to block car warranty spam calls. The agency released an order demanding that mobile carriers either stop that traffic from using their networks or provide reports as to their efforts to do so. The commission added that “auto warranty”-related calls resulted in the highest number of consumer complaints over the past two years.Sen. Elizabeth Warren and Rep. Pramila Jayapal sent a letter to Raimondo “raising questions about the revolving door between the Department of Commerce and Big Tech companies, and its potential impact on global digital trade rules.” Warren and Raimondo have been at odds over Europe’s tech competition rules. Warren, a prolific letter-writer, and fellow Bay Stater Ed Markey also wrote to four ed tech software providers pushing them to resist punishing students who seek information on abortions and reporting them to law enforcement.
In the states
Samsung unveiled tentative plans for a $170 billion slew of chipmaking facilities. The massive investment plan was filed to the Texas Comptroller’s office ahead of an end-of-year deadline for state tax breaks on large investment projects. Samsung would potentially build nine fabrication plants in Taylor, Texas, building on the existing plan to complete a $25 billion facility in nearby Austin.
The bills seeking to criminalize websites for providing information on abortion access have begun in South Carolina. Expect a lot more of those — and inevitable, politically fraught conflicts with Sec. 230 (to say nothing of the First Amendment). The measures will put immense pressure on even small websites to take down information, even if they would ultimately prevail in court.An outside political group spending (mostly) Peter Thiel’s money to support Blake Masters for the Arizona Senate seat is facing questions from the Federal Election Commission, the Arizona Mirror reports. The FEC is asking the PAC to disclose more about its spending, reportedly signaling concerns there may be irregularities or omissions. The Winklevoss twins also gave to the group.
A MESSAGE FROM ALIBABA
Alibaba — a leading global ecommerce company — is a particularly powerful engine in helping American businesses of every size sell goods to more than 1 billion consumers on its digital marketplaces in China. In 2020, U.S. companies completed more than $54 billion of sales to consumers in China through Alibaba’s online platforms.
In the courts
The Department of Justice arrested a former Coinbase manager on insider trading charges. The former employee allegedly used insider information regarding which crypto assets would be added to the Coinbase exchanges to make around $1.5 million. This represents the first-ever instance of insider trading charges being filed for cryptocurrencies.
Mark Zuckerberg and Sheryl Sandberg will be deposed over Cambridge Analytica. A group of users sued the social media giant over allegations that it illegally shared personal data with the British political consultancy that provided supposed insights to Donald Trump’s 2016 presidential campaign. Meta could lose hundreds of millions if it loses the case, per Bloomberg.
The SEC has piled on to the DOJ’s case against the former Coinbase manager and two others with its own charges, claiming nine of the 25 tokens at issue are securities. It’s the latest move in the multiplayer chess match between industry, several government agencies and lawmakers over which digital assets are securities versus commodities — and who gets to regulate them. If a judge signs off, it could tilt the landscape for those nine tokens and others like them.
A new trade group wants you to have the right to repair your enterprise software. Consumer groups have made headway in trying to ensure people don’t have to go to big phone makers like Apple to repair smartphones, but the new group, FreeICT USA, says more is needed to protect regional banks, health care companies, government agencies and others who still need to keep their IT up to date even they don’t have high-flying budgets for the latest cloud vendors.
Around the world
U.S.-based tech giants are entering an agreement to share some user information with the Indonesian government. Tech giants including Amazon, Apple, Meta, Twitter, Microsoft and Google all registered with the Indonesian communications ministry before a Wednesday deadline, which means they’d be obliged to share user data and follow content moderation laws. The Indonesian government would be able to order content removal when it deems that it threatens public order.
In the media, culture and metaverse
YouTube said it would place further restrictions on abortion-related content. Yesterday, the platform said that it would block content that included false claims about the safety of abortion procedures as well as any “unsafe or alternative” abortion methods.
$35.3 million: That’s how much money Amazon, Apple, Meta, Alphabet and their trade groups collectively spent on lobbying in the first half of 2022, according to a Bloomberg tally of disclosures. The total is up 15% from the same period in 2021. Amazon spent the most, with a budget of $5 million, followed by Google’s $2.8 million. The increase likely originates in tech’s work to defeat the Senate’s antitrust bill, but doesn’t even include the massive sums plunked down on ads opposing the measure.
A MESSAGE FROM ALIBABA
Using economic multipliers published by the U.S. Bureau of Economic Analysis, NDP estimates that the ripple effect of this Alibaba-fueled consumption in 2020 supported more than 256,000 U.S. jobs and $21 billion in wages. These American sales to Chinese consumers also added $39 billion to U.S. GDP.
That’s how Nancy Pelosi responded when asked whether her husband ever made a stock purchase based on information she provided. Paul Pelosi recently raised eyebrows after he purchased as much as $5 million in Nvidia stock, coinciding with (admittedly very public) attempts by Congress to pass $52 billion in subsidies for semiconductor manufacturers. Last year, the House speaker said she opposed any effort to limit stock trading by members of Congress, maintaining that she has no involvement in her husband’s investments.
Thanks for reading — see you Monday!