Trump’s Rise Terrifies Tech Industry

On issues like immigration, trade, and encryption, Trump is on the opposite side of Silicon Valley.

Amazon CEO and Washington Post owner Jeff Bezos
AP Photo
Brendan Sasso
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Brendan Sasso
May 17, 2016, 9:31 p.m.

Don­ald Trump has offered few spe­cif­ics on his policy agenda, but the po­s­i­tions he has out­lined have lead­ers in the tech­no­logy in­dustry deeply nervous.

Tech com­pan­ies say they are des­per­ate to hire more for­eign tal­ent, while the pre­sumptive Re­pub­lic­an nom­in­ee’s plan to crack down on im­mig­ra­tion is a center­piece of his cam­paign. Tech com­pan­ies sup­port the Trans-Pa­cific Part­ner­ship, while Trump reg­u­larly bashes that agree­ment and oth­er free-trade deals. The tech in­dustry is ral­ly­ing to pro­tect en­cryp­tion, while Trump called for a boy­cott of Apple when the com­pany res­isted the FBI’s de­mand for ac­cess to an en­cryp­ted iPhone.

“The in­dustry is some­where between astoun­ded that he got the nom­in­a­tion and scared to death that he’ll be­come pres­id­ent,” said one long­time Re­pub­lic­an lob­by­ist for tech com­pan­ies, who asked not to be named to avoid cross­ing the party’s nom­in­ee. “He is on the worst pos­sible side of trade, im­mig­ra­tion, en­cryp­tion, and [tax­ing] car­ried in­terest.”

Gary Sha­piro, the CEO of the Con­sumer Tech­no­logy As­so­ci­ation, which rep­res­ents Apple, Google, Amazon, and oth­er tech com­pan­ies, wor­ried that Trump could use the Fed­er­al Com­mu­nic­a­tions Com­mis­sion or the Justice De­part­ment to pun­ish com­pan­ies he doesn’t like.

In an in­ter­view on Fox News this month, Trump seemed to hint that he might go after Amazon for an­ti­trust vi­ol­a­tions or tax-dodging as pay­back for crit­ic­al cov­er­age in The Wash­ing­ton Post, which is owned by Amazon CEO Jeff Bezos.

Asked about the Post dig­ging in­to his past, Trump replied that Bezos is “us­ing The Wash­ing­ton Post for power so that the politi­cians in Wash­ing­ton don’t tax Amazon like they should be taxed,” and that Amazon has a “huge an­ti­trust prob­lem be­cause [Bezos is] con­trolling so much.”

Sha­piro, a Re­pub­lic­an, cri­ti­cized Trump for re­sort­ing to “school-yard bully threats” and hav­ing “no re­spect for the Con­sti­tu­tion.” Trump’s cam­paign did not re­spond to a re­quest to com­ment for this art­icle.

Trump has also re­peatedly prom­ised to pres­sure Apple to make its devices in the United States—al­though he hasn’t de­tailed how he would ac­com­plish that. “We’re go­ing to get Apple to build their damn com­puters and things in this coun­try in­stead of in oth­er coun­tries,” Trump said in a speech at Liberty Uni­versity in Vir­gin­ia in Janu­ary.

He has also shown little in­terest in pro­mot­ing an open or free in­ter­net. In a de­bate last year, Trump said he would con­sider “clos­ing areas” of the in­ter­net to com­bat Is­lam­ic State ter­ror­ists.

Face­book CEO Mark Zuck­er­berg, who launched his own pro-im­mig­ra­tion ad­vocacy group in 2013, took a clear shot at the brash busi­ness­man last month by cri­ti­ciz­ing “fear­ful voices call­ing for build­ing walls and dis­tan­cing people they la­bel as oth­ers.”

Trump has at least one prom­in­ent sup­port­er in the tech in­dustry: Peter Thiel, a PayP­al cofounder and Face­book board mem­ber, will be a Cali­for­nia del­eg­ate for Trump at the Re­pub­lic­an Na­tion­al Con­ven­tion. But Trump has few oth­er pub­lic back­ers in Sil­ic­on Val­ley and has raised vir­tu­ally no money from the in­dustry.

Tech com­pan­ies, still sting­ing from the glob­al back­lash caused by the Ed­ward Snowden rev­el­a­tions of U.S. sur­veil­lance, are es­pe­cially wor­ried that a Trump vic­tory could cre­ate even more prob­lems for their abil­ity to do busi­ness over­seas. “A Trump pres­id­ency would make the Snowden back­lash look like small pota­toes,” the Re­pub­lic­an tech lob­by­ist warned.

When Trump an­nounced his cam­paign last sum­mer, few in the tech world took him ser­i­ously. New Street Re­search, an in­vest­ment-re­search firm, pro­duced a tongue-in-cheek re­port on what a Trump pres­id­ency would mean for tele­com and cable com­pan­ies. Com­cast-NBCU, the firm pre­dicted, would be a loser be­cause “can­celing The Ap­pren­tice leads to new Must-Carry reg­u­la­tions cov­er­ing all Trump re­lated pro­gram­ming. Re­venge is sweet.”

Mean­while, the FCC headquar­ters, the firm wrote, would be “re­designed, very classy, with lots more marble.”

But in March, as Trump was steam­rolling his way through his GOP com­pet­it­ors, New Street Re­search de­cided to re­vis­it its “cre­at­ive” ana­lys­is and of­fer a more ser­i­ous take on the can­did­ate. While ac­know­ledging that Trump hasn’t pro­duced the kind of policy pa­pers or hired policy aides that could re­veal the cam­paign’s po­s­i­tions on wonky is­sues, the firm pre­dicted that a Trump ad­min­is­tra­tion would be­have like a typ­ic­al Re­pub­lic­an ad­min­is­tra­tion on most tele­com is­sues.

“Our be­lief is premised on the view that on such re­l­at­ively low-pub­li­city items, the par­tis­an grav­ity will be suf­fi­cient to bring Trump’s view in­to line with his party’s well-es­tab­lished path,” the firm wrote.

While Trump is re­viled in Sil­ic­on Val­ley, Sha­piro said that there’s little en­thu­si­asm for Hil­lary Clin­ton either. Her Demo­crat­ic op­pon­ent, Bernie Sanders, garnered the most pas­sion­ate sup­port in Sil­ic­on Val­ley, but Clin­ton ap­pears to be close to clinch­ing the party’s nom­in­a­tion. “This is not tech’s bright­est polit­ic­al day right now,” Sha­piro said.

But the Con­sumer Tech­no­logy As­so­ci­ation CEO also ac­know­ledged that all of Sil­ic­on Val­ley’s suc­cess and wealth might have con­trib­uted to some of the re­sent­ment that has fueled Trump’s sup­port. “In this great tech boom, there’s a part of Amer­ica that feels left out,” Sha­piro said. “And that’s something we need to ad­dress.”

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