A Brief Review of Hillary Clinton’s Innovation Plan20 July, 2016 / Articles
Late in June, presidential candidate Hillary Clinton surprised business leaders by issuing a detailed technology and innovation platform. Tech and business leaders should be taking note. The next person to win the White House will inevitably face a slew of important decisions about the future of the tech and startup sectors.
Clinton’s plan may have been designed to deflect growing concern here in California (where I work) and other innovation hubs about criticism of the tech economy from the Obama administration and other Democrats on the left. Just a day after the plan was released, for example, Democratic Sen. Elizabeth Warren of Massachusetts attacked leading technology companies, including Apple, Amazon, and Google, hinting that they had grown too large to escape the blunt instrument of antitrust to break them up.
But overall the Clinton agenda mixes unlikely promises for significantly increased federal spending in education, basic research, and infrastructure with more specific reforms in such hot-button areas as immigration, intellectual property, and tech infrastructure.
Though nearly every aspect of the plan would require a cooperative Congress, there is much to admire in the particulars, and, more to the point, much that innovators and their investors have wanted to hear from Washington for a long time:
Immigration. Among Silicon Valley’s highest priorities is immigration reform. Clinton promises “comprehensive” measures, including a pledge to “staple a green card” to the diplomas of non-U.S. master’s and PhD students in science and engineering, “enabling international students who complete degrees in these fields to move to green card status.” No technology company would object to that proposal.
Patents. Clinton also pledges to fix the badly out-of-balance patent system, although here the promised reforms are modest. The plan calls for reducing “excessive patent litigation” and endorses legislation floating around Congress that would break the stranglehold of the notoriously plaintiff-friendly Eastern District of Texas, which openly courts patent trolls and frivolous litigation. But there is no mention of larger patent issues, notably scaling back or eliminating patent protection for software and business methods, an invention of the courts and the patent office in recent years. The consensus, even among many leading software providers, is that those new categories have done far more harm than good.
Copyright. Clinton promises a law that would “unlock” a ballooning number of older written and audio-visual works that, thanks to repeated and retroactive copyright extensions on behalf of Disney and other large rights holders, can’t be licensed or used because no one knows who owns them anymore. (Liberation of so-called “orphan works” would have been enabled by a proposed settlement in a case involving wholesale scanning by Google Books, but that settlement was scuttled in 2011. Google went on to win the case outright.) The Clinton plan doesn’t address the expanding copyrights that created the orphan works problem, and others, in the first place.
The sharing economy. During the primaries, both Sen. Bernie Sanders and Secretary Clinton repeatedly raised concerns about new “sharing economy” services, including Uber and TaskRabbit, that help contractors and freelancers coordinate their work through network technologies. Sanders dismissed these services as “unregulated” and said he had “serious problems” with Uber in particular. For her part, Clinton said last year that network-based employment raises “hard questions about workplace protections and what a good job will look like in the future.”
Clinton’s tech and innovation plan is more measured, if noncommittal, about whether she sees the sharing economy as a direct attack on unions and labor regulators. She promises only to “convene a high-level working group of experts, business, and labor leaders to recommend how best to ensure that people have the benefits and security they need no matter how they work.” Depending on what specific “benefits and security” her experts believe casual workers need, that could mean an endorsement of the sharing economy or an onslaught of new regulations or a stall that leaves the problem with local authorities.
Broadband infrastructure. The recent decision by the Federal Communications Commission, at the urging of the White House, to transform internet access into a public utility has already spooked investors, who spent nearly $1.5 trillion over the previous 20 years continually upgrading broadband infrastructure even as America’s roads, bridges, water pipes, gas mains and electrical grid — the actual public utilities — fell catastrophically behind. (Washington, DC’s own Metro system, once the city’s pride and joy, is largely closed for repairs for the summer.)
Here the Clinton agenda gets a mixed grade. On the positive side, the candidate strongly endorses reducing regulatory barriers (largely at the state and local level, however) that unnecessarily deter more and more-efficient private infrastructure, including “dig once” and “climb once” policies to encourage faster deployment of, respectively, fiber optic cable and next-generation mobile equipment.
But at the same time, and even as the plan waves in the direction of continued internet self-governance under the multistakeholder process that has worked so well, Clinton “strongly supports” the idea that internet access should be closely regulated as a utility. As I’ve argued before, that approach is bound to slow both the speed and size of investments in continued infrastructure improvements.
Radio spectrum for 5G networks. On the plus side of the ledger, Clinton promises to continue President Obama’s support for next-generation mobile networks, known as 5G, which utilize densely packed cellular antennae and higher-band radio spectrum to offer as much as 100 times the speed and capacity of today’s wireless internet. Secretary Clinton promises to release spectrum warehoused by the federal government itself and to support a mix of licensed, unlicensed, and shared new frequencies that will accelerate nascent 5G applications, including the internet of things and autonomous vehicles, as well as increasingly high-definition video.
Internet adoption. The Clinton plan promises to expand broadband entitlement programs aimed at closing what remains of the digital divide. But these programs, including the troubled Broadband Technology Opportunities Program, have had limited success, if any at all.
While many people share the goal of universal broadband adoption for all Americans, the solution isn’t to raise taxes on consumer phone bills (currently approaching 20%!) to fund poorly managed programs to subsidize rural and low-income communities. Among those who do not have a broadband connection at home, availability and price are rarely cited as the principal reasons, as repeated surveys make clear.
It turns out that nonadopters, especially older Americans, don’t have a broadband connection largely because they don’t want one. Rightly or wrongly, digital holdouts don’t see the internet as having any relevance to their lives. That was a problem identified as long ago as 2010, in the visionary National Broadband Plan, from which the Clinton agenda cribs frequently (without any apparent acknowledgment). And it’s one problem government could play a crucial role in solving through public education and the president’s bully pulpit. But not from throwing more money at federal contractors.
The closer the next president — whomever it turns out to be — can hew to the U.S.’s longstanding if battered commitment to let a thousand Silicon Valley startups bloom, the better off everyone will be in the short as well as the long run. In my view, what the innovation ecosystem really needs is a reboot of a 1996 bipartisan promise to leave the internet “unfettered by Federal or State regulation” — a policy that now needs expansion to equally high-potential disruptors in energy, materials, robotics, genomics, health care, transportation, and manufacturing.
That, in any case, is the lesson of the last election in which innovation policy played a major role — the election, of course, of that other Clinton.