Disruption is a sign of strength in America’s economy. The Model T wreaked havoc on the horse and buggy and streaming music destroyed the CD, but the transportation and music industries both thrived. The technology industry is today’s emblem of disruption, yet some in the U.S. political system are responding with attacks that undermine their potential. This backward-looking approach threatens a vibrant, innovative and job-creating future. It also threatens America’s role in the world.
Pursuing actions that could jeopardize American companies’ leadership as global competition around technology innovation increases is a risky endeavor. Consider China. The Chinese government has vowed to outdo American tech, investing heavily in state-sponsored technology enterprises while imposing restrictions on foreign competition to help it surpass the United States in development of artificial intelligence and other emerging technologies. China is also investing heavily in a national strategy to accelerate its high-tech and advanced manufacturing industries.
Now U.S. policymakers and government officials are exploring the current state of technology competition through hearings and investigations. This would be encouraging, except that instead of furthering policy measures to increase the United States’ global competitiveness, the administration and Congress are focused inwardly on competition within U.S. markets. Doing so will put U.S. companies at a disadvantage, while China remains laser focused on its ascent. America’s future economic strength, its national security, and its leadership around the world are dependent on a vibrant technology sector. By suggesting that the United States’ leading companies need to be investigated or even broken up, U.S. leaders are sending the wrong signal about their faith in America’s technology industry at a critical time.
Of course, the technology industry is big. And, government has a role to conduct oversight. The recent hearings are an important part of that responsibility. But being big – even being dominant in a market – is not illegal if the growth came from innovation and having better products. There are policy areas like consumer privacy where past industry practices spark legitimate discussions of the need for regulation. But as policymakers and government officials explore the current state of competition in U.S. markets, it should be done with precision and avoid stifling America’s technology industry as it drives innovation, powers the economy, and helps usher in an important tide of change. The policy dialogue has shifted dramatically from one or two companies to a broader “big tech is bad” theme that is challenging confidence in this vital sector of our economy and threatening the United States’ global lead in innovation.
Technology companies that started in garages and dorm rooms now employ more than seven million Americans and contribute $1.6 trillion annually to the U.S. economy. The reason for this success is that the industry is making life better by improving health care, education, financial services, and the way we communicate and connect. The benefits of technology we take for granted, and today’s thriving and tech-rich environment, were distant dreams two decades ago. The pace of change and the competitive zeal that scrappy startups and big companies alike bring to the forefront is remaking the world and powering the global economy.
Monopolies control markets, hamper innovation and raise prices. The end of AT&T’s government-granted monopoly in the 1980s sparked telecommunications competition, but many unwarranted antitrust investigations against technology companies dragged on for decades and hobbled successful companies. Daily announcements of new and innovative products and services are testament to the robustly competitive technology marketplace. Big tech is creating new markets, not squelching them. It is driving an innovation ecosystem that has America leading the world and has improved consumers’ lives in immeasurable ways.
Tech has redefined the possible, yet anti-tech advocates ignore how technology and innovation developed by tech companies – both big and small – ripple across every aspect of society and the global economy. Technology helps the visually-impaired navigate and experience the world. Small businesses have global customer bases because of technology. Reporters and politicians use technology to share breaking news with the public and effectively serve their constituents. Cities use technology to better deliver services to their citizens.
It’s incumbent upon government and industry leaders to work together and leverage our technology industry’s boundless potential to help those dislocated by innovation, modernize our job training infrastructure, increase investments in research and development, improve education and access to high-speed broadband, and shore up our cyber defenses.
Is there a role for regulation and oversight? Absolutely. But not as means of preventing inevitable change, or at the risk of causing serious economic harm or ceding leadership on the world stage. Tech companies, consumers and policymakers alike have a responsibility to make sure the changes that are coming – no matter how disruptive – move everyone ahead.