WASHINGTON – United States Trade Representative Katherine Tai today addressed a virtual conference hosted by The Georgetown University Law Center on digital trade and inclusive trade policy. Ambassador Tai discussed the challenges in the digital economy and emphasized the need to put the well-being of people and workers at the center of digital trade policies.
Ambassador Tai’s remarks as prepared for delivery are below:
Good morning. I would like to thank Georgetown Law Center for hosting me today and I am looking forward to our discussion. But before we get to that, I want to share some remarks on digital trade policy and I’d like to start from a personal perspective.
In the fall of 1992, on the first day of freshman year, I vividly remember calling home from a payphone outside my dorm because the phone line in the room had not been activated yet. During my sophomore year, I signed up for my first email account. During my senior year, the worldwide web made its debut.
I bought my first book on Amazon in 1999. I acquired my first cell phone in 2000 and my first smart phone in 2009. I attended my first virtual work meeting in – no surprise, March 2020. There has not been a week in the last year and half when I have not had a virtual meeting.
Consider how much our daily lives, interpersonal interactions, economic activities, and modes of work and productivity have changed over these last three decades.
What we sometimes still talk about as the “new” or “future” economy is actually the economy we have now. It is an increasingly digital and digitalized economy, which continues to grow, evolve, and challenge us in every realm of our individual and collective experiences.
That is why we must approach digital trade policy with thoughtfulness and wisdom so that we pursue growth that is inclusive, fair, sustainable, and advances the quality of life of human beings.
Trade policy sits at the intersection of domestic and foreign policy, so the policies we develop must be calibrated with our broader agenda. But we have seen over time that trade policy becomes unsustainably fragile whenever it becomes detached from the issues facing ordinary working people.
At USTR, we are putting workers at the center of our trade policy – and thinking about how our work will impact their day-to-day lives. And second, we are creating durable trade policies that work in concert with our domestic economic and foreign policies. This is key to building broad-based support for our work among all of our stakeholders – and creates the foundation required for steadfast U.S. leadership in the global economy.
What does this mean for digital trade?
It is important to recognize that there is no bright line separating digital trade from the digital economy – or the “traditional” economy for that matter. Nearly every aspect of our economy has been digitized to some degree. Our efforts to formulate and pursue digital trade policies should, therefore, begin with a high level of ambition to be holistic and inclusive.
Despite their expansiveness, there is not an agreed definition of “digital economy” or “digital trade.”
But the general consensus seems to coalesce around the notion that the digital economy comprises economic activity generated by the marriage of an ever-greater, distributed computing power, and ever-faster transmission networks.
- Infrastructure: fixed and mobile telecommunications networks, including 5G, and large-scale data centers;
- Platforms: these are the services, based on cloud computing, that allow suppliers to interact with consumers and businesses globally; and
- Applications: both tools that end-users need – for example, word-processing, inventory management, and accounting software, as well as direct-to-consumer products, such as e-books, videos, and games.
There are a few key topics that arise whenever we talk about the digital economy, including:
- A high degree of mobility, and how technology reduces the relevance of borders;
- Concerns about data, including privacy and security;
- How governments balance accountability, freedom, innovation, and growth;
- The concentration of power and how that affects the interests of small- and medium-sized businesses; and
- Energy and resource needs in the context of sustainability.
Around the world, we see different responses across governments to similar digital challenges. Embedded in those responses are varying societal and political values, including authoritarian instincts that are deeply incompatible with our tenets and principles.
I mentioned earlier that USTR wants to develop durable trade policies. But with technology and our digital economy constantly evolving, achieving durability requires us to prioritize flexible policies that can adapt to changing circumstances.
We’ve seen what happens when trade agreements and trade policy become outdated and fail to address modern challenges. By maintaining flexibility in our digital trade policies, we can ensure they remain resilient and long-lasting.
I also believe that our approach to digital trade policy must be grounded in how it affects our people and our workers.
We must remember that people and workers are wage earners, as well as consumers. They are more than page views, clicks, and subjects of surveillance. They are content creators, gig workers, innovators and inventors, and small business entrepreneurs.
This means they have rights that must be protected – both by government policy and through arrangements with other governments.
On the other side of the equation, we must also recognize that our technology companies are not just innovators and service providers. They are also forces changing the nature of our lived experiences and our society. It is not hyperbole to say that these companies have the power to affect the lives of people and the direction of our civilization’s development.
That power requires responsibility and accountability. And these stakeholders have responsibilities in shaping the digital economy.
Cybersecurity is an illustration of this challenge. Companies and individuals both benefit from digital technologies – but the data they store and process puts both them and their consumers at significant risk of attack by criminal and state actors, often from abroad.
Companies may face a prisoner’s dilemma – will they invest in cybersecurity protection if their competitors gain a price advantage by not making that investment? How can governments and businesses work together to address this pernicious threat? These goals are not just about national security, but global security.
While these are important ideas – corporate accountability in our tech sector, protecting the rights of consumers – we must acknowledge there is a trust gap and ask whether we have adequately designed digital trade rules to meet the needs of ordinary people.
We must overcome the trust gap, particularly for workers and consumers – and recognize that the digital economy should also address sustainability concerns.
As we think about digital trade policy, we are asking big and consequential questions at USTR that will guide our approach, including:
- How do we ensure that our digital trade agenda supports our broader national security interests, for example with respect to physical infrastructure, cybersecurity, and reliable semiconductor supplies?
- How do we ensure our digital trade agenda works hand-in-hand with our other domestic and foreign policies, while maintaining flexibility for future challenges?
- How can we work with our allies on issues like artificial intelligence in a way that safeguards economic security for workers while protecting democracies against external threats?
- How can we balance the right of governments to regulate in the public interest, with the need for rules that guard against behavior that discriminates against American workers and businesses?
There are no easy answers to these questions. But if our starting point is a desire to put people at the center for our policies – as it has been for our entire trade agenda since I was sworn in – then the outcomes we reach can be more inclusive and responsive to their needs.
The imagination of our artists and story tellers have often illustrated our hopes and anxieties about technology and where it will lead us.
Recently, I re-watched the Pixar film “WALL-E.” It tells the story of a rusty robot named WALL-E who cleans up trash alone on an environmentally devastated and uninhabitable earth. He encounters a modern robot named EVA, sent from a faraway spaceship where humans have taken refuge. Her mission is to look for signs of life on earth.
The movie features relevant themes about the threats our way of life poses to sustainability, the displacement of workers and future of work, and a struggle of wills between technology – in the form of robots and AI – and humanity.
But it is ultimately a tremendously hopeful story about love, inclusiveness, and resilience.
People are rightfully concerned about the future of technology and how it will impact their lives and livelihoods. But there is a lot that we can and should do to address those anxieties, to guide the development of the digital transformation in a positive direction.
Governments and policymakers cannot lose sight of the needs of our people and our collective humanity. And we therefore must approach our work on digital trade with thoughtfulness, deliberation, and care.
It is particularly important that our approach includes students, like the ones here today, because you represent the most technologically sophisticated generation in history. And I suspect that you will be the ones with the most open and creative minds that we will need to address many of the policy questions that we face.
The challenges around digital trade policy will not be solved overnight; it begins with conversations like this.
So, let’s dive in.