WEBVTT - Technology Under a Global Microscope

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<v Speaker 1>You're listening to Bloomberg Business Week with Karl Messer and

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<v Speaker 1>Tim Stenebek on Bloomberg Radio.

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<v Speaker 2>We've got a great guest to get into what's going

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<v Speaker 2>on when it comes to technology, but really the global

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<v Speaker 2>battle among the three dominant digital powers when it comes

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<v Speaker 2>to regulating the space and influencing it.

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<v Speaker 1>It's the subject of a brand new book, Digital Empires,

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<v Speaker 1>The Global Battle to Regulate Technology, written by a new Bradford,

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<v Speaker 1>Professor at Columbia Law School and senior scholar at Columbia

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<v Speaker 1>Business School. The book a follow up to her book

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<v Speaker 1>The Brussels Effect, a term that she coined. She joins

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<v Speaker 1>us on a zoom here in New York City. It's

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<v Speaker 1>good to have you with us, professor, How.

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<v Speaker 3>Are you good? Thank you so much for having me.

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<v Speaker 1>Well, thanks so much for joining us. It's so interesting.

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<v Speaker 1>We talked about regulating technology last week that Diana Henriquez,

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<v Speaker 1>who wrote a book about the Well's written many books,

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<v Speaker 1>but her most recent book is about the SEC and

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<v Speaker 1>the development of the SEC under FDR. And we asked

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<v Speaker 1>her what you know that what needs to be regulated

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<v Speaker 1>in this day and age, and without hesitation, she said

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<v Speaker 1>it was technology. And I'm wondering how are you looking

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<v Speaker 1>at that through the lens of your book, especially outside

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<v Speaker 1>of the United States.

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<v Speaker 3>Yeah. So, certainly is they growing consensus around the world

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<v Speaker 3>that technology needs rules and the governments do need to

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<v Speaker 3>step in, but there is no consensus what those rules

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<v Speaker 3>really ought to look like. So in the book, I

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<v Speaker 3>argue that there are three prominent ways to think about

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<v Speaker 3>governing technology. There is the American market driven way, there

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<v Speaker 3>is that Chinese state driven way, and then there's a third,

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<v Speaker 3>the European rights driven regulatory model.

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<v Speaker 1>Talk about the European one because that's kind of freshener

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<v Speaker 1>in our thoughts because of what Apple did with its

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<v Speaker 1>new USB C connector because that's the result of regulation.

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<v Speaker 3>Absolutely, and that was one of those manifestations of the

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<v Speaker 3>Brussels effect, whereby rules that are set in the European

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<v Speaker 3>Union find their way into the global production and global

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<v Speaker 3>conduct of the tech companies. But basically, unlike the Americans

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<v Speaker 3>that really have focused on free market, free internet and

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<v Speaker 3>sort of maximizing the opportunities for innovation, or the Chinese

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<v Speaker 3>and that really want to bring the state there to

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<v Speaker 3>leverage technology, including to maintain political control, the European rights

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<v Speaker 3>riven models starts from this presumption that digital revolution needs

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<v Speaker 3>to be human centric, the preservation of the democratic structures

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<v Speaker 3>of the society, the fundamental rights of the individuals take

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<v Speaker 3>the center stage, but also incorporates this notion of a

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<v Speaker 3>more fair digital economy so that we redistribute some of

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<v Speaker 3>the gains from the tech companies to the smaller players,

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<v Speaker 3>to users, and to the public at large.

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<v Speaker 2>So, Professor Bradford, do you is it kind of going

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<v Speaker 2>to follow the same path as we've seen to some

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<v Speaker 2>extent with climate right and oversight, and also even I

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<v Speaker 2>feel like global regulatory oversight when it comes to markets,

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<v Speaker 2>it does feel like the EU leads away on a

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<v Speaker 2>lot of stuff.

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<v Speaker 3>So that is exactly right. So the Europeans have consistently

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<v Speaker 3>just shown that they are much more comfortable with government

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<v Speaker 3>intervening and much more skeptical with the idea that markets

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<v Speaker 3>on their own, left to their own devices, would generate

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<v Speaker 3>optimal outcomes. So the Europeans have been the ford runners

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<v Speaker 3>when it comes to regulating food safety, consumer protection, the environment,

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<v Speaker 3>the battle to mitigate climate change, and now I think

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<v Speaker 3>one of the newest frontiers has been the regulation of technology,

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<v Speaker 3>where again the Europeans are showing the way.

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<v Speaker 2>Why is it so important that we be having this

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<v Speaker 2>discussion right now?

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<v Speaker 3>So I think that if you just look at the

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<v Speaker 3>vast power of these tech companies, they have the economic

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<v Speaker 3>power they called power, informational power, cultural power. They're really

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<v Speaker 3>shaping the societies and the lives of individuals around the world.

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<v Speaker 2>And I will say, just for a second, when we

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<v Speaker 2>had Diana henriquezon when we'd asked her who are the

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<v Speaker 2>power brokers back in the nineteen twenties, it was industrialists, right,

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<v Speaker 2>and she made the point of the power brokers today

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<v Speaker 2>are those that are in control of data, whether it's

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<v Speaker 2>Google or you know, Amazon, pick your company, but they

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<v Speaker 2>are the power brokers. But anyway, go ahead and continue.

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<v Speaker 3>That is exactly right, and that is one of the

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<v Speaker 3>main concerns that the Europeans in particular take the view

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<v Speaker 3>that we cannot let these companies to be the power brokers,

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<v Speaker 3>that we need to then bind them to the rule

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<v Speaker 3>of law and subject they conduct to democratic oversights. So

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<v Speaker 3>we do need to bring the governments that are representing

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<v Speaker 3>the people back to the table and then sort of

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<v Speaker 3>directing the course of our digital economy.

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<v Speaker 1>Based on the books that you've written, the research that

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<v Speaker 1>you've done, the work that you've done, which approach is

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<v Speaker 1>the best?

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<v Speaker 3>So look, I am a believer in the digital transformation

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<v Speaker 3>needing a liberal, democratic foundation, So there is no way

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<v Speaker 3>that I can endorse that the Chinese digital authoritarian model.

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<v Speaker 3>I think that is too oppressive. It infringes individual rights

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<v Speaker 3>and liberties and subjects population to massive and as surveillance.

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<v Speaker 3>So I have many issues with the Chinese model, even

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<v Speaker 3>though I must recognize that China has done really well

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<v Speaker 3>in devel developing technologies even without having freedom as the

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<v Speaker 3>foundation of the society. But if the Chinese model is

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<v Speaker 3>too oppressive, I think the American model can be viewed

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<v Speaker 3>as too permissive, and it has really failed to step

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<v Speaker 3>in to protect the fundamental rights to protect our data

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<v Speaker 3>and just placed too much of the trust in tech

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<v Speaker 3>companies that have then failed to reality task as guardians

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<v Speaker 3>of our data and protectors of the digital space. So

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<v Speaker 3>that really leaves the European model as the one that

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<v Speaker 3>I think best advances public interests and checks the corporate

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<v Speaker 3>power and ultimately then leads to aa more sort of

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<v Speaker 3>fear thriving digital society.

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<v Speaker 2>So does the EU and the US align on this

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<v Speaker 2>because it sounds like that's what needs to happen.

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<v Speaker 3>I think that is exactly right, that ultimately you would

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<v Speaker 3>need both the US and the EO to join forces

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<v Speaker 3>and align behind a sort of same set of principles

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<v Speaker 3>for that governance model to be effected. And I would

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<v Speaker 3>say that there is a shift underway in the US.

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<v Speaker 3>So the US itself is now starting to rethink its

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<v Speaker 3>technol libertarian commitments and starting to ask whether the markets

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<v Speaker 3>really are capable of governing the digital economy. And you

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<v Speaker 3>see the public opinion both shifting. You see that many

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<v Speaker 3>bills being proposed in Congress, and that indicates that there

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<v Speaker 3>certainly is a different conversation about technology that is much

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<v Speaker 3>more closer to the European rights driven model than what

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<v Speaker 3>we've seen in the past.

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<v Speaker 2>You right that this battle over digital quote will ultimately

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<v Speaker 2>determine the soul of the digital economy, defining what kind

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<v Speaker 2>of society we will live in for years and decades

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<v Speaker 2>to come, in a battle that the US nor the

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<v Speaker 2>EU can afford to lose. If we don't get this right,

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<v Speaker 2>then what.

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<v Speaker 3>So what ultimately to me is at stake here? The

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<v Speaker 3>biggest battle is really about liberal democracy, and I think

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<v Speaker 3>the US and the EU should remember that liberal democracy

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<v Speaker 3>can be lost in one of two ways. So one

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<v Speaker 3>is if the US and EU will lose the horizontal

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<v Speaker 3>battle to China and the world is turning more authoritarian.

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<v Speaker 3>But also if the US and the EU lose the

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<v Speaker 3>vertical battle to the tech companies and fail to effectively

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<v Speaker 3>control them, because if that happens, then the true digital

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<v Speaker 3>empires are either the authoritarians or then the tech companies,

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<v Speaker 3>and neither solution is sustainable for anybody who believes in

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<v Speaker 3>liberal democracy.

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<v Speaker 1>You know, it's interesting, Carol, I say this over and

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<v Speaker 1>over again, but if there's you know, there's not much

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<v Speaker 1>that unites Democrats and Republicans here in the US and Congress.

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<v Speaker 2>But this does bring them together.

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<v Speaker 1>It does at least the idea of regulating big tech

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<v Speaker 1>right quote unquote, regulating big tech the way they want

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<v Speaker 1>to do it is certainly different, and the reasons why

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<v Speaker 1>are different, but you know, they want to do it.

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<v Speaker 2>It's a really good point. And I also feel like

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<v Speaker 2>there's a fair amount of streaming services out there, are

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<v Speaker 2>streaming series out there that reminds you when data takes over,

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<v Speaker 2>like kind of what happens to our world. Professor Bradford,

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<v Speaker 2>Thank you so much. Really appreciate the time with you.

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<v Speaker 2>A New Bradford Professor at Columbia Law School, Senior scholar

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<v Speaker 2>at Columbia Business School, an from New York City. Her

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<v Speaker 2>new book, Digital Empire, is the global battle to regulate

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<v Speaker 2>technology