U.S. Trade Representative Katherine Tai has announced that she is dropping longstanding U.S. digital trade demands in talks with the World Trade Organization.
By announcing that it will not pursue any new digital trade agreements or initiatives, the USTR has surrendered to the radical agenda of progressive activists who seek to dismantle the core rules and principles that have guided U.S. digital trade policy for two decades.
These principles, such as non-discrimination, data flows, and data localization, are essential for ensuring a free, open, and competitive Internet that benefits American businesses and consumers, as well as our allies and partners around the world. The U.S. trade principles are essential in countering the authoritarian digital models of China, Russia, India, and others, who seek to impose their own restrictive and discriminatory regimes on the Internet and the digital economy.
These rules and principles have been enshrined in landmark agreements such as the U.S.-Mexico-Canada Agreement (USMCA) and the U.S.-Japan Digital Trade Agreement, as well as in ongoing negotiations at the WTO, APEC, OECD, and other areas. They have been widely adopted by our allies and partners, who share our vision of a rules-based digital order that respects human rights, fosters innovation, and promotes cooperation.
Now, the Biden administration has thrown away all this progress and leadership by caving into the demands of DOJ Antitrust Chief Jonathan Kanter, FTC Chair Lina Khan, U.S. Senator Elizabeth Warren (D-Mass.), and the progressive activists at their command. This crew has hijacked the USTR’s agenda and are pushing for a radical overhaul of U.S. digital trade policy that would put American companies on the chopping block to the benefit of our adversaries.
Their radical agenda includes:
- Removing due process and consumer welfare standards from the competition chapter of digital trade agreements, which would allow them to pursue arbitrary and politicized investigations and enforcement actions against American companies.
- Installing officials in Brussels to enforce the EU’s Digital Markets Act (DMA) and Digital Services Act (DSA), which would impose heavy-handed regulations on American companies that would hamper innovation and competitiveness on the world stage.
- Blocking U.S. government engagement against these measures in the EU and other markets, which would prevent us from defending our interests and values against unfair trade practices and digital protectionism.
- Blocking USTR’s effort to assess the impact of EU measures on Chinese/Russian interests, which would blind us to the strategic implications of these measures for our national security and global leadership.
Members of Congress on both sides of the aisle are slamming this abrupt reversal. U.S. Senator Ron Wyden (D-Ore.) blasted the move, calling it a “win for China plain and simple.” Senate Republicans released a statement in opposition, saying “Ambassador Tai makes clear in her speeches and through her actions that foreign countries are free to discriminate against U.S. companies and workers as long as these countries and USTR can concoct an excuse. Failing to stand up for America and against foreign discrimination—particularly from China—is contrary to the USTR mission.” Reps. Darin LaHood (R-Ill.) and Suzan DelBene (D-Wa.) said that the move was made “without the consent of Congress.”
Ultimately, the USTR announcement is part and parcel with the Biden administration’s mission to bring leading industries under the thumb of the federal government. This approach is actively harming our leading industries to the benefit of Russia, China, and others. Instead of promoting American industries, progressives want to harm them on the world stage. This radical agenda should be rejected.