What the US election means for innovation

Claire McFarland

The US election is on November 3, 2020. Two very different candidates, two very different political parties. What does the US election outcome hold for tech and innovation? And what should Australia do?

Regardless of who wins the US election, technology and innovation will be areas of focus as antitrust action against Google kicks off and economic recovery is targeted

In his opening statement to the most recent hearing on Online Platforms and Market Power of the House Judiciary Antitrust, Commercial and Administrative Law Subcommittee, Chair David N Cicilline (RI – D) made it clear beyond doubt that no matter the outcome of the November presidential election, the tech giants are squarely in the sights of both sides of the aisle.

Claire McFarland
Claire McFarland: The US election and the impact on tech and innovation

“As gatekeepers to the digital economy, these platforms enjoy the power to pick winners and losers, shake down small businesses, and enrich themselves while choking off competitors,” he said.

“Their ability to dictate terms, call the shots, upend entire sectors, and inspire fear represent the powers of a private government.”

Rare bipartisanship is on display in Congress’ message on the need for action on tech giants’ power. The Department of Justice and 11 Republican attorneys-general have filed an antitrust lawsuit against Google just two weeks out from the US election which, while raising some timing questions, has been solidly supported by both sides of the aisle.

Democratic attorneys general are forging ahead with a separate complaint against Google and depending on the election outcome these actions may be combined at a later date.

Post November, with real GDP growth declining and unemployment rising in the US, the economic impact of COVID-19 will continue to be a concern. Voter choice will dictate what kind of fiscal stimulus the US pursues to counter the impact.

However, from a technology policy perspective, there will be a need to balance the role technology plays as an enabler of recovery and the perceived actions of tech giants in stymying competition, innovation and particularly small business and manufacturing.

Beyond this, Trump and Biden have both taken a national security approach to the challenge of new technologies, particularly artificial intelligence and quantum computing. Both have announced funding for research and development directed to breakthrough technologies.

In late August 2020, the Trump administration announced a further investment of US$1 billion in research institutes to advance American leadership in AI, quantum information science (QIS) and 5G communications.

This funding, funnelled through the National Science Foundation and Department of Energy, is directed to research universities.

The comparison point in the Biden campaign is the July 2020 announcement of the ‘Innovate in America’ investment of US$300 billion investment in R&D and breakthrough technologies (electric vehicles, lightweight materials, 5G and AI are all mentioned).

Australia has been stepping out in front of the US on tech regulation, has an emerging quantum computing expertise and has sought to carve out a niche in standards development for artificial intelligence.

These are matters of strong mutual interest and impact for the US and Australia, and bilateral cooperation will lead to better outcomes for the citizens and economies of both countries.

A Biden administration will bring technology and innovation into its focus on American democratic leadership and government stimulus

From Joe Biden’s policy platform, it is clear his campaign team see technology companies and the standards inherent in their operations as an issue at the heart of democracy, an issue that requires international collaboration.

American leadership of the democratic world is a key tenant of Biden’s campaign, sending a message to allies of how a Biden administration would differ from a second Trump term. Joe Biden’s promised “Summit for Democracy”, to be held sometime in 2021 if Biden is elected, includes a ‘call to action’ for the private sector.

Technology corporations and social media giants are explicitly called upon to make their own commitments: “recognising their responsibilities and their overwhelming interest in preserving open, democratic societies and protecting free speech.

On the international stage, there is a strong indication a Biden administration would leverage economic and trade might into shaping the ‘rules of the road’ specifically on cyber theft, data privacy and artificial intelligence, so they continue to reflect democratic interests and values – America’s interests and values – and are bound by laws and ethics that promote greater shared prosperity and democracy.

Domestically, Biden has made a commitment to “Buy American” by using federal purchasing power to aggressively promote US national interests, specifying a list of American-made goods from steel to medical supplies and, importantly, future purchases in advanced industries like cutting-edge telecommunications and artificial intelligence.

What Australia should do

For Australia, a Biden administration will provide some certainty about the next four years. There’s a recognition that Australia is an important ally and like-minded democracy. As such, Australia will have a seat at the table.

However, with a strong focus on American economic recovery and a clear plan on ‘made in America’ that extends to buying, innovating and investing in America, Australia could stand to lose some existing investment and export opportunities.

The Biden campaign has a strong focus on ensuring the economic opportunities from investment in innovation is shared throughout the US to support jobs, small businesses and entrepreneurs in every part of the United States. There will be much to learn from the United States in this as Australia confronts its own recovery.

Australia will do well under a Biden administration to emphasise its commitment to rules-based democracy and leadership on tech regulation.

A Trump administration will bring more of the same, with technology and innovation focused on national security issues and self-interest

President Trump has been vocal in his criticism of American tech giants many times during his first term, usually when their actions impinge on him personally. In May 2020, he claimed the “Radical Left is in total command and control of Facebook, Instagram, Twitter and Google”.

Trump has actively railed against social media companies censoring his posts and has encouraged people to report perceived political bias, launching a tool in May 2019 to enable people to share their story with the White House. Indicative of President Trump’s desire for publicity over policy, this tool is no longer active.

Given that the last three years has resulted in little concrete regulation, it is likely tech companies recognise the president’s tweets and antagonistic comments as media attention-seeking behaviour and need to appease his ‘base’.

Even his recent executive order aimed at one of the core protections relied on by social media companies – that they can’t be held liable for most things users put on their platforms – is likely seen as avoidable noise. It took just three days for the first lawsuit against the executive order to be filed.

Beyond this, the Google antitrust lawsuit is now in the hands of the Justice Department and may take years to resolve.

One area where the Trump administration has made some headway is in artificial intelligence (AI), kicked off by the February 2019 “Executive Order on Maintaining American Leadership in Artificial Intelligence” and largely driven by national security interests and through the US Department of Commerce National Institute of Standards and Technology (NIST).

Significant R&D investment has been made in AI, and there is agreement that AI standards are necessary. However is also clear there are hurdles ahead and a view that “many decisions still need to be made about whether there is yet enough scientific and technical basis to develop those standards provisions.”

The plan for prioritising federal agency engagement in the development of standards for AI – formulated in response to President Trump’s executive order – sets out the need for the United States to strategically engage with international parties to advance AI standards for US economic and national security needs.

This includes championing US AI standards priorities in international standards development activities and accelerating the exchange of information between federal officials and counterparts in like-minded countries through partnering on development of AI standards and related tools. This is one area where Australia has a role to play.

What Australia should do

A second Trump term would likely be as unpredictable as the first, requiring a continuing ‘new’ approach to diplomacy. In relation to technology standards, working with the United States on standards for breakthrough technologies is important in developing and maintaining technology that is safe, consistent and reliable.

In relation to technology regulation, Australia, with its swift and decisive legislation on sharing of abhorrent violent material and the draft News Media and Digital Platforms Mandatory Bargaining Code has shown it can take its own path in relation to American tech giants and should continue to do so, no matter the outcome of the US presidential election.

Claire McFarland is an Honorary Associate at the United States Studies Centre at the University of Sydney.

Do you know more? Contact James Riley via Email.

  1. anonymous 3 years ago

    Expecting ANY admin in the US to not blatantly favour their own would be a triumph of hope over reality.

    Democrat or Republican, they all back “US all the way”, as anyone with trade experience will know well.

  2. Its lovely to see you coming out in support of a candidate that will support innovation

    Unfortunately you picked the wrong one, whether through bias or design.

    Only one candidate has a success careeer building & running ventures.

    Whilst the other candidate (and his son) are now mired in corruption allegations, For which their is documented evidence on a lap of, including that they sold sold (for personal gain) commercial, state & technology secrets.

    And we won’t mention the deplorable, illegal, unethical, criminal & immoral behaviour of the candidates’ son.

    Your report is biased in the extreme. I had hoped you wouldn’t fall to the level of the MSM, but it’s obvious that the anti-Trump campaign is in full swing, despite reason or fact.

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