Daniel Sepulveda: Reevaluating American Digital Trade Policy
The United States is in the process of reevaluating its approach to digital trade policy. After decades of bipartisan support for the open global internet and the free flow of data largely in venues outside of trade agreements, the issue has entered the trade space. Though e-commerce chapters in trade agreements have existed for some time, a heated debate has arisen from the American led effort to inject new language into the agreements since the US-Korea Free Trade Agreement that would meaningfully and further restrict states from taking steps to slow or block the free flow of data except for the implicit allowances in trade in general.
As a result of the potential repercussions of new binding obligations for domestic policy from digital trade agreements, the U.S. Trade Representative (USTR) is asking whether we should revisit, pursue, or engage in trade agreements that restrict the ability of participating states to:
Block or slow the free flow of data across borders;
Mandate that data collected in a jurisdiction stay in that jurisdiction, and/or;
Mandate that digital economy participants grant governments access to source code and algorithms as a precondition for market participation.
The USTR argues that the pace of change in technology and its potential for disruption require an active, strong policy response. Without dictating that response, the agency wants to ensure that trade agreements do not excessively restrict the ability of nation states to produce one.
In my view, acknowledging that there is no one-size-fits-all approach to this challenge, in the pursuit of bilateral and plurilateral digital trade agreements, the USTR should:
Modify Proposed Text to Trade Agreements: Propose text to trade agreements that encourage the free flow of data but explicitly allow exceptions for states to slow or block data flows, require some form of limited data localization, and require access to source code subject to intellectual property protection, for specific public interest and consumer protection purposes to the extent necessary.
For example, government access to source code and algorithms for artificial intelligence foundation models that due to computational power and capabilities present a potential threat to national security should be allowed. Blocking the transfer of personal data from the U.S. to hostile nation states may be necessary. And access to sensitive information that may be transferred out of our country to a hostile state may be required to be held domestically.
Adjust Grants for Exception to Level of Trust in Trading Partners: Exceptions to restrictions in agreements and the process for their adjudication for judging for necessity and should reflect the level of trust between the parties negotiating.
The More Participants the Broader the Exceptions: In the case of the pending World Trade Organization (WTO) discussions[1], exceptions to restrictions for the free flow of data and access to source code need to be broad and any proposed adjudication of violations subject to non-binding arbitration. That is because of the number of nations involved includes many unlikely to comply and as of today, the United States has little faith in the existing dispute resolution process.
Err on the Side of Open Commerce: But WTO agreements on electronic commerce should not remain silent on the questions of the free flow of data, data localization, and access to source code mandates because those provisions could send an important message to the world on the value of open digital markets and our desire to preserve them. To the greatest extent possible, trade agreements should promote open digital commerce.
Start Over with Trusted Partners: In the case of agreements with trusted partners like the US-Mexico-Canada Agreement (USMCA) and the Japan Digital Agreement, the existing exceptions to restrictions are excessively narrow and should be revisited, but they should remain as narrow as possible because those are allies and compatible economies, and we should pursue more agreements with additional likeminded partners. A Digital Trade Agreement for the Americas may be a good place to start that builds on the USMCA.
In revisiting the language in question at the WTO and reconsidering digital trade chapters in other agreements, the Biden Administration should consider the ramifications for policymaking at home. But it should also consider the implications of remaining silent on these issues for the continued support of internet freedom abroad, deferring as broadly as possible in favor of the free flow of data and non-discrimination principles.
We can preserve the necessary policy space for states to regulate technology companies while simultaneously fighting for as global and open a digital economy as possible.
With all the challenges the modern, global digital economy creates, it also fuels immense economic activity, improves the delivery of services and goods, and increases the productivity and capability of people at all economic levels to improve their lives. Where barriers to digital commerce are necessary to pursue a specific public interest, with allies we should be able to work out a negotiated resolution as we have on privacy law with the European Union. With adversaries or where we reach impasse on resolution, the WTO should serve as a venue for articulating an argument for why those barriers are unfair and should be lifted.
The Hill Names Erik V. Huey as a Top Lobbyist for 2023
Today, The Hill has named Erik V. Huey, President of Platinum Advisors DC as a top lobbyist in 2023.
In January, Capitol Hill opened its doors to lobbyists once again after pandemic restrictions were lifted. That means corporate lobbyists, hired guns, association leaders and grassroots activists are back in full force, and these top lobbyists have had to navigate a divided Congress — and not just the traditional Republican and Democratic divisions.
As legislating ground to a halt amid debt ceiling battles and the historic Speaker ouster, K Street set their sights on behemoth must-pass packages including the farm bill, Federal Aviation Administration reauthorization and the National Defense Authorization Act as vehicles to advance their policy priorities.
Top lobbyists have also helped their clients navigate the flood of regulatory activity from the Biden administration, which has started pushing billions of dollars in funding, grants and tax credits out the door as major legislative packages— namely the Inflation Reduction Act (IRA), Infrastructure Investment and Jobs Act, and CHIPS and Science Act — come online.
The federal lobbying bench is deep, with more than 12,500 actively lobbying so far in 2023, and not everyone on this list is a registered lobbyist. These impactful advocates stand out for the results they’ve delivered for their clients, companies, trade associations and advocacy groups in the nation’s capital.
Read the full article by the Hill here.
The AI Governing Challenge: A Public Policy Report by Daniel Sepulveda
Platinum Advisors Senior Vice President and Former U.S. Ambassador on Information Technology Daniel Sepulveda has authored a comprehensive report that extensively examines the complexities created by artificial intelligence.
Download the full report here.
Platinum Advisors is committed to working closely with our clients on the public policy challenges created by artificial intelligence. We are available to discuss these challenges with you and can help you navigate this new, complex ecosystem.
ABOUT THE AUTHOR
Widely regarded as an expert on public policy issues facing new and emerging technology, Daniel Sepulveda served as a Senate confirmed Ambassador in the Economic Bureau of the State Department in the Obama Administration from 2013-2017. He also served in the Senate for more than a decade as a policy advisor to Senators Boxer, Obama, and Kerry.
His policy areas of expertise range from digital privacy, technology, and artificial intelligence. In the Senate, he managed Senator John Kerry’s portfolio as the Chair on the Subcommittee on Technology and Telecommunications on the Commerce Committee. As Ambassador, he led negotiations on multiple international treaties and bilateral agreements on telecommunications and technology.
Platinum Perspective: California Leading the Artificial Intelligence Conversation in Washington, DC and Sacramento
Over the last several weeks, the United States Congress, the Biden Administration, several federal agencies and a number of state legislatures have convened meaningful and valuable conversations around the potential regulation of Artificial Intelligence (AI).
Platinum Advisors is actively engaged in these conversations on behalf of our clients around the country. The State of Celifornia, its representatives in Congress, its flagship technology companies and research and development institutions, and its state legislature will play a unique role in the coming deliberations over how to enable the development of artificial intelligence without exposing Americans to substantial harm.
U.S. Representative Jay Obernolte (R-CA-23), a former California State Assemblymember and the only member of Congress with an advanced degree in AI has emerged as a leader in this policy area due his extensive professional background in technology and his valuable ability to explain these complex concepts to his fellow Members of Congress and constituents alike.
Rep. Obernolte was recently featured in the Washington Post regarding his knowledge of this important policy discussion as well as his recent insightful op-ed in The Hill where he states that AI’s “benefits to society will likely far outweigh the costs,” even if it requires “a major shift in our education system, our workforce and our laws.”
Back in Sacramento, Assemblymember Rebecca Bauer-Kahan (D-16) introduced legislation (AB 331) earlier this session seeking to address potential algorithmic discrimination when automated tools are utilized to make consequential decisions related to healthcare, housing or hiring.
The Golden State’s capital is not alone in seeking to address potential harms of AI. Around the country, a number of states have been working to examine these important issues further by creating formal state task forces or working groups to provide recommendations. Other legislatures have introduced legislation seeking to prohibit use of AI or automated decisions systems in certain instances or seek to make their use more transparent for the public including Connecticut, Illinois, New Jersey, New York, Pennsylvania and Texas.
This week the U.S. Senate Judiciary Committee’s Subcommittee on Privacy, Technology and the Law held a hearing entitled Oversight of A.I.: Rules for Artificial Intelligence that included testimony from Sam Altman, CEO of OpenAI.
This month, the White House convened a meeting that included Vice President Harris and Commerce Secretary Raimondo as well as the executive leadership of four American companies at the forefront of AI innovation including OpenAI, Anthropic, Microsoft and Google to share concerns about the risks associated with AI. To date the Biden Administration has been active on this front releasing its Blueprint for an AI Bill of Rights and related executive actions announced last fall.
Earlier this year, The U.S. Department of Commerce’s National Institute of Standards and Technology (NIST) released its Artificial Intelligence Risk Management Framework (AI RMF 1.0) as a guidance document for voluntary use by organizations designing, developing, deploying or using AI systems to help manage the many risks of AI technologies.
Here's how much S.F. hotels are paying workers to fill 1,200 open jobs
It all begins with an idea.
Our client Lynn Mohrfeld, President & CEO of the California Hotel & Lodging Association, was recently featured in the San Francisco Chronicle discussing the surplus of career opportunities in the City's hospitality sector.
San Francisco hotels are eager to hire workers as they rebound from pandemic doldrums, industry leaders said Tuesday.
“We need 1,200 new employees in San Francisco and we need them now,” said Lynn Mohrfeld, CEO of the California Hotel & Lodging Association, at a news conference at the Hyatt Regency San Francisco. His group later clarified that Indeed.com shows nearly 1,200 open hotel jobs within 25 miles of San Francisco and nearly 600 open hotel jobs in San Francisco.
Read the full article here.
CALWA Podcast: Crown Castle’s Rochelle Swanson Discusses Future of Telecommunications Industry
It all begins with an idea.
Our client, Rochelle Swanson of Crown Castle who serves as Vice President of the California Wireless Association, was recently featured on the organization's podcast to discuss what's in store for telecommunications industry in 2023 and beyond!
Billions of people still lack high-speed internet. This S.F. company is building satellites to change that
It all begins with an idea.
We're proud to work with Astranis Space Technologies on its mission to connect the world by investing in the next generation of internet satellites. The company was recently featured in the San Francisco Chronicle in an article that highlighted how Astranis is making strides to close the digital divide:
“As it turns out, beaming high-speed internet to the remote corners of Alaska from thousands of miles away in space starts with a brick of titanium in a San Francisco warehouse.
In a vast complex where the U.S. once churned out World War II-era Liberty ships, Astranis is building satellites that it plans to send to orbit more than 22,000 miles above the Earth’s surface, with the first slated to be borne skyward aboard a SpaceX Falcon Heavy rocket from Cape Canaveral next year.
Each of these robot sentinels costs tens of millions of dollars to make, but, according to Astranis CEO and aerospace engineer John Gedmark, the price tag is worth it to solve one of humanity’s enduring challenges: high-speed internet connection.
“We’re talking about 3 or 4 billion people that do not have broadband internet,” across the globe, a problem that has gotten worse as the planet’s population has increased, he said. “It’s one of the largest problems that humanity has to solve today.”
Read the full article here.
Ambassador Danny Sepulveda on Prospects for Immigration Reform
It all begins with an idea.
Platinum’s own Ambassador Danny Sepulveda recently joined Sirius XM’s Julie Mason in the Mornings to discuss the prospects for immigration reform and the political climate in Washington, DC.