Digital Exports Dwarf Other Industries, So Why Is The USTR Ignoring Them?

from the just-clueless dept

We’ve talked a few times about how the USTR seems to have an antiquated view of the American economy these days, which is driving it to make some really bad and dangerous assumptions about what sorts of things should be in the Trans Pacific Partnership (TPP) agreement — things that benefit a few older legacy industries, which totally ignore the reality of where innovation is happening today. In fact, the current policies that the USTR is pushing in the TPP agreement seem designed to actually hold back the most innovative industries of today, pushing them to other countries instead, and massively harming the US economy. We’ve detailed, for example, how the main committee of industry folks who are the “advisers” on the “intellectual property” chapter come from legacy industries, rather than anything involving the internet. The “IP” Industry Trade Advisory Committee (ITAC 15) includes a bunch of lumbering giants, more focused on protecting their positions, than on innovating.

Senator Ron Wyden’s office recently asked the Congressional Research Service (known for the high-quality, non-partisanship of their reports) to look at how much “digitally enabled services” were exported out of the US today, and to compare that with other “large” exporters, which the USTR generally thinks it’s protecting. The results are somewhat astounding. Digital exports are massive compared to all of those other industries.

And yet, the USTR seems focused on helping out all those other guys at the expense of the digital services that make up such an important part of our economy. Why? At this point, it seems that there’s just a massive level of ignorance within the USTR about which part of our economy is actually driving so much growth — and their plans to protect old line industries create real problems for the internet, and they just don’t seem to care.

At least some in Congress are finding this situation quite troubling. Reps. Jared Polis and Thomas Massie have teamed up to ask USTR Michael Froman to finally commit to actual transparency, and that includes both releasing the text of the IP chapter and finally letting people who are actually knowledgeable about the internet and its impact on the economy into the discussions.

While we recognize the need to maintain a degree of confidentiality in negotiating our trade agreements, we remain disappointed that important stakeholders including civil society groups, businesses, and academics have not been able to meaningfully participate in the treaty process. The Industry Trade Advisory Committee on Intellectual Property (ITAC-15) has a limited membership, precluding a more diverse set of stakeholders from being able to review and provide input on the negotiating texts or regularly meet with United States Trade Representative (USTR) negotiators.

In particular, we are concerned that the TPP Intellectual Property Rights chapter leaked in November 2013 would place undue restrictions on our copyright laws, harming our innovation, our economy, and an open and free Internet. These standards are troubling given their ability to potentially restrict the legislative branch, particularly when Congress has indicated it is beginning to evaluate the merits of revising these laws. For example, as sponsors of H.R. 1892, the Unlocking Technology Act, we are particularly troubled by draft proposals concerning prohibitions on the circumvention of technical protection measures or Digital Rights Management. The leaked treaty draft includes language that would seemingly make any permanent fix to unlocking cellphones illegal. Intellectual property is a dynamic policy area in which preserving Congress’ ability to adapt to the changing nature of technology is absolutely critical for the United States and our trading partners.

To that end, we encourage the Administration to work with the negotiating parties to publicly release the current official text of the TPP intellectual property and related chapters—or at least summaries of these proposals—and invite public comments on such provisions before the agreement is concluded. A strong precedent already exists for such a process; for instance, the Anti-Counterfeiting Trade Agreement official text was made public an entire year before the agreement was finalized. Additionally, in the future we urge you to develop a more open model of trade agreement negotiation.

Personally, I think this language could and should be much, much stronger, given just how out of touch with reality the USTR seems to be. With the Congressional Research Service itself noting how much more important digital services exports are to the economy, why is the USTR still ignoring them, and looking at them as if the internet is a second- or third-class citizen in the US economy?

Meanwhile, over on the Senate side, Senators Ron Wyden and John Thune have introduced a bill directly seeking to promote an open internet when it comes to trade agreements:

The Digital Trade Act of 2013 would establish negotiating principles to address several key digital trade matters in future bilateral and multilateral agreements and in multistakeholder settings. Those principles include: preventing or eliminating restrictions on cross-border data flows, prohibiting localization requirements for data and computing infrastructure, ensuring that provisions affecting platform Internet sites are consistent with U.S. law, and recommitting the United States to the multistakeholder model of Internet governance. The bill requires the president to prioritize digital trade and ensure it benefits from robust and enforceable rules.

Again, it might be nice if this was even stronger, but recognizing that it’s difficult to get anything through Congress these days, perhaps you need to start with things that seem simple and obvious, like having the USTR recognize that “digital” is actually a big business these days.

Filed Under: digital exports, innovcation, jared polis, john thune, ron wyden, thomas massie, tpp, ustr