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
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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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