Silicon Valley’s Quest for Favors
I never thought I’d find myself agreeing with the longtime Trump associate and election denier Steve Bannon. But last month, he argued that the Silicon Valley "broligarchs" are cozying up to the newly elected president because they "want essentially a bailout."
Why Silicon Valley Needs the Trump Administration
Of course, Mr. Bannon has his own agenda, as he is battling the tech bros for President Trump’s attention and favor. But Mr. Bannon has also spotted something real. Stuck between the soaring costs of complying with global regulations and the astronomical costs of the race for artificial intelligence dominance, our largest tech companies are likely turning to the Trump administration to try to lock in their advantages.
The Regulatory Threats
Silicon Valley faces numerous regulatory threats, as governments around the world gradually respond to the havoc Big Tech has caused. In the European Union, Google has been fined $8.6 billion in the past decade. Apple is liable for a $13.5 billion tax bill in Ireland after losing a court case. And Meta was recently fined about $830 million by the E.U.
The Pursuit of AI Dominance
Closer to home, antitrust actions against the biggest tech titans are winding their way through the courts, and U.S. states are stepping into the federal regulatory void with dozens of new protections for youth, for workers and for our data. This year, eight new state privacy laws will go into effect, and the California Privacy Protection Agency has already begun its enforcement actions, which allow it to impose fines of nearly $8,000 per intentional violation. That could reach into the millions or even billions of dollars.
Artificial Intelligence Concerns
Silicon Valley’s supposed lead in artificial intelligence — oft touted as the future of technology in which a trillion dollars could be invested — seemed to evaporate recently when a Chinese start-up claimed to have produced a product of equivalent quality for a fraction of the price. Microsoft and OpenAI’s subsequent discounting of prices did not inspire confidence. Mr. Altman even speculated about giving its models away free, jeopardizing the billions the industry hopes to get from customer sales.
Conclusion
Little wonder the tech titans are increasingly seeking help from the U.S. government. They need protection from the regulatory threats, and they need access to government contracts and data to maintain their dominance in AI.
Frequently Asked Questions
Q: Why are tech companies seeking favors from the Trump administration?
A: Tech companies are seeking to avoid regulatory threats and maintain their dominance in artificial intelligence.
Q: What regulatory threats are Silicon Valley companies facing?
A: Companies are facing fines and antitrust actions in the European Union and U.S. states for violating data privacy and antitrust laws.
Q: Why do tech companies need government contracts?
A: Tech companies need government contracts to access data and resources to maintain their dominance in artificial intelligence.
Q: Is the tech industry as powerful as it seems?
A: Despite its power, the tech industry is facing significant challenges and is vulnerable to regulatory action.
