Marietje Schaake thinks Silicon Valley has pulled off a major power grab, taking on decisions that were once made by elected leaders and democratic governments. A former EU parliamentarian now at Stanford, Schaake outlines the problems posed by tech’s growing influence over our daily lives in a new book, “The Tech Coup.” On POLITICO Tech, Schaake joins host Steven Overly to explain what governments can do to take back their power.
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This episode is brought to you by Shopify. Forget the frustration of picking commerce platforms when you switch your business to Shopify. The global commerce platform that supercharges your selling, wherever you sell. With Shopify, you'll harness the same intuitive features, trusted apps, and powerful analytics used by the world's leading brands. Sign up today for your $1 per month trial period at Shopify.com/tech. I'll lowercase. That's Shopify.com/tech. (upbeat music) Hey, welcome back to "Bledico Tech." It's Tuesday, September 24th. I'm Stephen Overlay. There's a new book out today that's sure to make some waves in the tech world. And it's called "The Tech Who." How to save democracy from Silicon Valley. Now, a coup implies to me an overthrow of the government. But author Murray Heishaka told me it's actually been a power grab. And she's raining from a lot of experience. She's now the international policy director at Stanford University's Cyber Policy Center. But before that, she was an EU parliamentarian, a politician who met with these tech companies over the years and pushed for regulation in Europe. Many of her criticisms have to do with the fact that tech crosses borders, giving companies large and small influence that rivals governments in terms of shaping our daily lives. On the show today, we had a frank and wide-ranging conversation. And she told me what she thinks governments must do to take their power back. Here's our conversation. Welcome to "Bledico Tech." - Thank you. - You talk in the book about this idea of a tech coup, which suggests, you know, based on the title, kind of an overthrow of government by tech companies, right? That's what a coup is. Is that what you feel Silicon Valley has done? - Well, I look at it more like a power grab that in part was done deliberately through lobbying or misleading regulators. But in part is also really the sum and the outcome of so many years of inaction on the part of the US government, but really governments in the democratic world altogether that are now more dependent on tech companies for their functioning. They are often blindsided because they lack access to information and they're just not the guardrails and oversight mechanisms that are necessary for this ever more powerful part of our lives, that is what the tech field has become. - And so what is the threat then that that poses to democracy? Because you talk about this idea of saving democracy. - Well, I think more and more key decisions are no longer made by democratically elected and accountable leaders. So on the one hand, we see a sort of de facto power from the fact that tech companies develop new technologies that create new realities. And sometimes those new realities are very powerful and impactful on the lives of people. But we also see areas where a legal gray zone or even no man's land has emerged. Think about offensive cyber capabilities where companies are actually engaging in cross border activities attacking hackers, for example, from intelligence services across borders. But there's no clear mandate. There's no clear accountability. There's not even really a process of knowing who's doing what on the part of democratic governments. And I think that seeps power away from democratic leaders means there's an accountability gap and that ultimately your course hurts democracy. - You know, for those who don't know your background, you've been in the European Parliament, you've been an academic at Stanford. So you've looked at this issue from a few different perspectives. I'm sort of curious if there was a particular moment for you when this idea of a tech who really came into focus. - Well, there's one moment that's very striking to me in terms of the power of also smaller tech. And that is when going back in time 15 years, I had just been elected as a member of European Parliament. And one of my first foreign trips was to Eastern Turkey, where at the time a lot of activists from the Islamic Republic of Iran who had been rising up in the green movement against what they considered an illegitimate outcome of the elections were fleeing because they were persecuted. And they kept telling me about their emails and their communications being compromised. They thought they were being hacked. And even a very conservative government like the Islamic Republic had access to very sophisticated hacking tools and was indeed using those against activists. And these spyware tools were exported from European based companies. And I just thought that was unacceptable. I was shocked at the time because here we had all these political leaders making statements in favor of human rights. And we had these companies exporting spyware tools that were violating human rights. And nothing was being done against it. So that was a real tipping point for me. But the tech who the book is really in many ways, the journey that I traveled from being excited about what new technology would bring to being increasingly worried to seeing these companies get so big and so bold and so resourceful in so many ways. They have a lot of money, can hire talent, they can lobby, they have data, they have compute. And it's really the sum of those parts that I worry about a great deal and that I don't think is appreciated. Because if we look at the news, we see a headline after headline scandal after scandal, but it's not quite treated yet as a systemic problem which I think it is. - Why do you think that is? - Well, I think on the one end, it's one of those cases where what is the straw that breaks the camel's back? I mean, at some point it adds up to a systemic problem and I think we're reaching that point. On the other hand, the incidents that we see, whether it's cybersecurity breaches, whether it's the impact on children or the impact of disinformation on elections or our public health when people stop trusting science and vaccinating their children, these incidents are serious enough. I mean, they're really worrying. And so I understand that they are consuming a lot of attention, a lot of focus in the policy realms too. Like, what do we do with this problem, that problem? I mean, it's a lot. But what I hope to do with a tech who is sort of shift the perspective to the lens of power and agency and look at solutions from that perspective too, because I hope that by addressing the outsized power of tech companies in terms of the impact that has on democracy, we can solve for a number of challenges in one go instead of trying to address them one by one by one. - One you've mentioned, both kind of big tech and small tech. And one question I had is to what degree is the power that tech companies now have really derived from size and profitability alone? Or is it greater than that? - To me, it's greater than that because we have some small tech like spyware that's very aggressive anti-democratic technology that doesn't even get close to big tech scale companies that we also have abusing their power in different ways. So I don't think we can look at it just as a product of big tech, but of course big tech to a large extent facilitates this whole ecosystem. And a lot of these bigger companies have started to put out many more services. They're now building infrastructure, for example, data centers, undersea data cables in order to develop artificial intelligence in order to have cloud computing in order to service their clients. So you also see that the consequences of them growing means that they're gonna get involved in more and more areas and that the dependence as a result gets bigger and bigger because this consolidation of power, this manifesting of the same companies in so many different areas. (upbeat music) - This episode is brought to you by Microsoft Azure. Turn your ideas into reality with an Azure-free account. Get everything you need to develop apps across cloud and hybrid environments, scale workloads, create cloud-connected mobile experiences, and so much more. Discover what you can create with popular services free for 12 months. Learn more at azure.com. That's azure.com. And sign up for a free account to start building in the cloud today. - You mentioned earlier, which I thought was an important point, this idea that the power of tech has grown because governments have a time's been complacent about regulating. No one has been farther along or more advanced, though, I would say than the EU. Obviously, you served in the EU Parliament. I wonder if there are lessons learned in that experience that you think other governments should be taking up? - For sure. So first of all, I think democratic leaders and institutions, elected officials should feel empowered to make sure that technology does not disrupt what is most precious to us. This is not a force of nature. This is not something that just happens to us, but indeed, leaders have allowed it to happen. And particularly in the US, where so many of these powerful tech companies are based, the hands-off approach has really been dominant on both sides of the aisle. And so I'm hopeful that Americans will see that it is possible to do more, to put up guardrails and apply oversight. And what I appreciate about the EU's approach is that a lot of the reasons for adopting new laws are deeply anchored in respect for fundamental rights and freedoms. So they're not just seen through an economic lens or a national security lens, which are often the dominant lenses in the United States. And I think that that is helpful and also is explainable from the fact that in recent history, Europeans also had to deal with the repression coming from Nazism, communism, where governments abuse their power through the collection of data, through targeting people on the basis of the data that they had about them. So there's a different sensitivity about what it looks like when things go wrong and what people have to lose from political leaders here. On the other hand, I think the EU can learn from the US to have more of a strategic and national security sensitivity about the role of tech. And so the two can balance each other out if they could learn from each other. - Well, it's interesting because I feel in recent years that we have started to see some balancing out there and started to see sort of the US and the EU coordinate more or at least talk more when it comes to tech regulation. We've seen both the US and the EU bring antitrust lawsuits against big tech companies like Google and Apple. And just in recent weeks, the governments have actually had some wins in court where the courts have agreed that these companies do have too much power. Is this in some ways the beginning of reversing that tech coup that you write about? - Well, I'm a big believer in the importance of antitrust rules and regulations, but they're fundamentally an economic tool. In the tech coup, I talk about not only looking at harms from companies amassing significant market power, which is what antitrust law does, but also looking at significant societal power because the challenge I have with putting too much faith in antitrust regulation is that it assumes that by enforcing economic rules, we will have ripple effects that will be positive for democracy. - Right. - And if that's the case, perfect, but it's a sort of indirect route to challenging the impact on democracy from outsized power of tech. And I think it's time to address that problem of a power grab of an erosion of the ability on the part of democratic leaders to govern directly. - And so where would you start in terms of addressing that? Like what's one thing that, whether it's the US or any government should be doing right now to kind of reclaim power that's been lost? - Well, one area that I think is underutilized is the fact that governments are often the biggest customers for tech companies. So the dependence is huge, this is a problem, but it also is leveraged that governments can use. They can put in different criteria when they procure certain contracts. They can make sure that public values are much more embedded in the technology that they procure. And so it's not only regulation that we need to look at, but also investments in public digital infrastructure, for example, but also the standards and criteria in contracts that can be used much more efficiently to have more transparency, for example, or more accountability also in the way tech companies are used as part of performing government tasks. - In the book, you touch on what I think is a dominant part of the conversation and debate around tech, which is sort of the specter of China. Some of these emerging tech platforms are coming out of China. We've seen China's influence grow globally, right? Particularly when it comes to exporting some technologies. Are we right now sort of forced into this decision between a future dominated by American technology or dominated by Chinese technology? - It is often presented that way. And it's also a very helpful frame when people want to get something done in the US because the concern for China is one of the few topics that actually is shared in the Democratic Party and the Republican Party. But I actually think that to say US versus China means democracy versus autocracy in tech governance assumes that there's too much governing for preserving democracy. In fact, I criticize the US government for not doing enough to make sure that developments in tech are pro-democracy. And so I just don't think we can assume that this narrative is true and is going to play out that way because we see tech companies that are also very keen to keep good relations with China, to have access to the market, to have access to the rare earth materials from China, have access to cheap labor and so on. Think about companies like Apple or think about a company like Google that actually was developing a surge engine for China before the project got killed. But it's not a given that companies will choose the side of democracy when they're forced to choose. - We're obviously against the backdrop right now of a presidential election in the US, which being Politico is obviously top of mind for us. What is the potential for a change in our approach to tech and how we regulate it? - Well, trust me that the campaign and the elections are also followed elsewhere in the world like in Europe. I mean, it's very important elections for everyone around the world and not always for the right reasons. So a lot is at stake also in tech policy. And I think for Kamala Harris, in some ways it's going to be a litmus test. From Donald Trump, we know that he's happy to change his positions depending on who funds him. He has already aligned himself, you know, with the Elon Musk's of this world. And by choosing JD Vance who has so much support from a venture capitalist in Silicon Valley, we know that they're going to take the de-regulatory path. They want fewer rules, more room for companies. This is already clear. With Kamala Harris, there are some question marks, but also pushes from potential or existing donors who want her to, for example, Firelina Khan at the head of the FTC, or want to support a de-regulatory agenda. So there's a lot of arm wrestling there about what direction Kamala Harris is going to take. And I can only hope that she will stay firm, look at what is necessary in the interest of the public, in the interest of safeguarding democracy, which is a clear policy point of hers or a campaign point of hers. But also when it comes to non-discrimination, it is well known that AI applications and other tech services are discriminating. And that's unacceptable yet they get away with it. There are national security concerns around an over-reliance on a handful of cloud computing providers over-reliance on cybersecurity companies that are simply incapable of protecting the US's most sensitive information. So my feeling is that there is more and more concern growing in a variety of corners of society. And I hope that Kamala Harris is able to use those concerns as engines for change in the US, because if the US changes in a positive way by making sure that innovation is possible and that the tech sector thrives, but that it does so within a healthy rule of law-based system, then the world will change. - Well, the book is called The Tech Coo. It is out now. Thank you so much for being here on Politico Tech. - Thank you so much. - That's all for today's Politico Tech. For more tech news, subscribe to our newsletters. Digital Future Daily and Morning Tech. Our managing producer is Annie Reese. Our producer is Afra Abdullah. I'm Stephen Overlay. See you back here tomorrow. (bright music) (gentle music)
