Americans are understandably worried about internet privacy. In particular, they fear their personal information could be hacked at any time. And if you ask them whether China should have access to their social security numbers, credit cards, and banking info, the answer would be a resounding “No.”
We live in a digital world, though. And since 2019, there has been debate at the World Trade Organization (WTO) over the handling of such private information. Specifically, Big Tech companies have convinced America’s trade negotiators to demand an international agreement prohibiting other countries from implementing “data localization.” In other words, Google, TikTok, and Amazon want to store customer data wherever they please. And U.S. negotiators have supported this position by opposing other countries’ ability to house and protect data within their own electronic borders.
This digital security debate has become a hot issue in Congress, and lawmakers are now debating exactly how to rein in tech companies while protecting consumer safety and national security. That’s why U.S. Trade Representative Katherine Tai should be praised for taking an important step recently when she dropped U.S. objections to data localization and privacy laws in other countries.
Tai’s decision is a win for U.S. consumer privacy. But large tech companies such as Amazon, Microsoft, and Google aren’t happy. And some in Washington are accusing Tai of ceding America’s digital leadership to China.
Tai was right to end U.S. objections to data localization until Congress can decide what America’s policy should be. And with TikTok being criticized for allowing China to view American user data, it’s clear the issue needs addressing.
Other countries are equally troubled by breaches in user privacy—and they’ve been understandably bothered by initial U.S. efforts to block data localization. But despite near-unanimous sentiment among global consumers, large digital companies are still chafing against any limits.
The major tech giants maintain a “cloud” of globally networked data centers to store and process information. These companies operate thousands of servers, and they want to continue their profitable status quo—even if it means fighting attempts to protect consumers’ personal data.
Amazon, for example, would certainly prefer to store all of its data in one place. That would save the company money. But Amazon currently earns billions of dollars annually for providing exactly these services. Tai’s decision simply means that Amazon and other large firms may have to use new software in the future to govern where they store data.
Conversely, if major tech firms had their way, vast troves of consumer data could be stored anywhere—including in China—despite risks to national security and consumer privacy. Again, this isn’t what Americans want.
Big Tech is now bristling at Tai’s decision. Essentially, she’s dented their longstanding dominance over global trade negotiations. But many members of Congress agree with Tai since they’re also concerned about the prospect of U.S. data being stored offshore. In particular, Sen. Elizabeth Warren (D-MA) has publicly criticized large tech companies for trying to “pre-empt domestic and international regulatory efforts” in order to “influence trade negotiations” on data storage.
Sen. Warren is right. There is simply no mandate in Congress—or within the Biden administration—to give Big Tech free rein on data localization, privacy, and consumer information. If anything, Americans want the opposite.
Some critics paint Tai’s decision as yielding America’s digital authority to China. But that runs counter to an obvious concern—limiting Beijing’s access to Americans’ private data. These critics overlook that Tai has now made it possible for Congress to consider precisely the rules needed to ensure that U.S. consumer information won’t be stored in China.
Many industrialized nations are concerned about where their citizens’ data is being housed. They’d simply prefer it to be stored domestically. That’s their prerogative. But Big Tech companies have been self-servingly fighting to pull the world into one enormous, virtual cloud. And that’s a recipe for global hacking. It’s not what Americans want. It’s good to see the Biden administration standing up to Big Tech’s self-serving agenda.