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Fix TikTok? Or Nix It? The Authoritarian RESTRICT Act

08 Saturday Apr 2023

Posted by Nuetzel in anti-Semitism, Big Government, Liberty, Technology

≈ 1 Comment

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AI, Artificial Intelligence, Attention Span, ByteDance, CATO Institute, Caveat Emptor, ChatGPT, Community Standards, Data Privacy, Elon Musk, First Amendment, Free Speech, Hate Speech, L. Frank Baum, Munger Test, National Security, Open Source, PATRIOT Act, People’s Republic of China, Philip Hamburger, Protectionism, RESTRICT Act, Scott Lincicome, Separation of Powers, The Land of Oz, TikTok, Twitter

There’s justifiable controversy surrounding TikTok, the social media app. I find much to dislike about TikTok but also much to dislike about the solutions some have proposed, such as a complete ban on the app in the United States. Such proposals would grant the federal executive branch powers that most of us wouldn’t grant to our worst enemy (i.e., they fail the “Munger test”).

Congressional Activity

The proposed RESTRICT Act (Restricting the Emergence of Security Threats that Risk Information and Communications Technology) is a bipartisan effort to eliminate the perceived threats to national security posed by technologies like TikTok. That would include a ban on the app. Proponents of a ban go further than national security concerns, arguing that TikTok represents a threat to the health and productivity of users. However, an outright ban on the app would be a drastic abridgment of free speech rights, and it would limit Americans’ access to a popular platform for creativity and entertainment. In addition, the proposed legislation would authorize intrusions into the privacy of Americans and extend new executive authority into the private sphere, such as tampering with trade and commerce in ways that could facilitate protectionist actions. In fact, so intrusive is the RESTRICT Act that it’s been called a “Patriot Act for the digital age.” From Scott Lincicome and several coauthors at CATO:

“… the proposal—at least as currently written—raises troubling and far‐reaching concerns for the First Amendment, international commerce, technology, privacy, and separation of powers.”

Bad Company

TikTok is owned by a Chinese company, ByteDance, and there is understandable concern about the app’s data collection practices and the potential for the Chinese government to access user data for nefarious purposes. The Trump administration cited these concerns when it attempted to ban TikTok in 2020, and while the ban was ultimately blocked by a federal judge, the Biden administration has also expressed concerns about the app’s data security.

TikTok has also been accused of promoting harmful content, including hate speech, misinformation, and sexually explicit material. Critics argue that the app’s algorithm rewards provocative and controversial content, which can lead to the spread of harmful messages and the normalization of inappropriate behavior. Of course, those are largely value judgements, including labels like “provocative”, “inappropriate”, and many interpretations of content as “hate speech”. With narrow exceptions, such content is protected under the First Amendment.

Unlike L. Frank Baum’s Tik-Tok machine in the land of Oz, the TikTok app might not always qualify as a “faithful servant”. There are some well-founded health and performance concerns related to TikTok, however. Some experts have expressed reservations about the effects of the app on attention span. The short-form videos typical of TikTok, and endless scrolling, suggest that the app is designed to be addictive, though I’m not aware of studies that purport to prove its “addictive nature. Of course, it can easily become a time sink for users, but so can almost all social media platforms. Nevertheless, some experts contend that heavy use of TikTok may lead to a decrease in attention span and an increase in distraction, which can have negative implications for productivity, learning, and mental health.

Bad Government

The RESTRICT Act, or a ban on TikTok, would drastically violate free speech rights and limit Americans’ access to a popular platform for creativity and self-expression. TikTok has become a cultural phenomenon, with millions of users creating and sharing content on the app every day. This is particularly true of more youthful individuals, who are less likely to be persuaded by their elders’ claims that the content available on TikTok is “inappropriate”. And they’re right! At the very least, “appropriateness” depends on an individual’s age, and it is generally not an area over which government should have censorship authority, “community standards” arguments notwithstanding. Furthermore, allowing access for children is a responsibility best left in the hands of parents, not government.

Likewise, businesses should be free to operate without undue interference from government. The RESTRICT Act would violate these principles, as it would limit individual choice and potentially harm innovation within the U.S. tech industry.

A less compelling argument against banning TikTok is that it could harm U.S.-China relations and have broader economic consequences. China has already warned that a TikTok ban could prompt retaliation, and such a move could escalate tensions between the two countries. That’s all true to one degree or another, but China has already demonstrated a willingness and intention to harm U.S.-China relations. As for economic repercussions, do business with China at your own risk. According to this piece, U.S. investment in the PRC’s tech industry has fallen by almost 80% since 2018, so the private sector is already taking strong steps to reduce that risk.

Like it or not, however, many software companies are subject to at least partial Chinese jurisdiction. The means the RESTRICT Act would do far more than simply banning TikTok in the U.S. First, it would subject on-line activity to much greater scrutiny. Second, it would threaten users of a variety of information or communications products and services with severe penalties for speech deemed to be “unsafe”. According to Columbia Law Professor Philip Hamburger:

“Under the proposed statute, the commerce secretary could therefore take ‘any mitigation measure to address any risk’ arising from the use of the relevant communications products or services, if the secretary determines there is an ‘undue or unacceptable risk to the national security of the United States or the safety of United States persons.’

We live in an era in which dissenting speech is said to be violence. In recent years, the Federal Bureau of Investigation has classified concerned parents and conservative Catholics as violent extremists. So when the TikTok bill authorizes the commerce secretary to mitigate communications risks to ‘national security’ or ‘safety,’ that means she can demand censorship.”

A Lighter Touch

The RESTRICT Act is unreasonably broad and intrusive and an outright ban of TikTok is unnecessarily extreme. There are less draconian alternatives, though all may involve some degree of intrusion. For example, TikTok could be compelled to allow users to opt out of certain types of data collection, and to allow independent audits of its data handling practices. TikTok could also be required to store user data within the U.S. or in other countries that have strong data privacy laws. While this option would represent stronger regulation of TikTok, it could also be construed as strengthening the property rights of users.

To address concerns about TikTok’s ownership by a Chinese company, its U.S. operations could be required to partner with a U.S. company. Perhaps this could satisfied by allowing a U.S. company to acquire a stake in TikTok, or by having TikTok spin off its U.S. operations into a separate company that is majority-owned by a U.S. entity.

Finally, perhaps political or regulatory pressure could persuade TikTok to switch to using open-source software, as Elon Musk has done with Twitter. Then, independent developers would have the ability to audit code and identify security vulnerabilities or suspicious data handling practices. From there, it’s a matter of caveat emptor.

Restrain the Restrictive Impulse

The TikTok debate raises important questions about the role of government in regulating technology and free speech. Rather than impulsively harsh legislation like the RESTRICT Act or an outright ban on TikTok, an enlightened approach would encourage transparency and competition in the tech industry. That, in turn, could help address concerns about data security and promote innovation. Additionally, individuals should take personal responsibility for their use of technology by being mindful of the content they consume and what they reveal about themselves on social media. That includes parental responsibility and supervision of the use of social media by children. Ultimately, the TikTok debate highlights tensions between national security, technological innovation, and individual liberty. and it’s important to find a balance that protects all three.

Note: The first draft of this post was written by ChatGPT, based on an initial prompt and sequential follow-ups. It was intended as an experiment in preparation for a future post on artificial intelligence (AI). While several vestiges of the first draft remain, what appears above bears little resemblance to what ChatGPT produced. There were many deletions, rewrites, and supplements in arriving at the final draft.

My first impression of the ChatGPT output was favorable. It delineated a few of the major issues surrounding a TikTok ban, but later I was struck by its repetition of bland generalities and its lack of information on more recent developments like the RESTRICT Act. The latter shortfall was probably due to my use of ChatGPT 3.5 rather than 4.0. On the whole, the exercise was fascinating, but I will limit my use of AI tools like ChatGPT to investigation of background on certain questions.

An Internet for Users, Not Gatekeepers and Monopolists

09 Wednesday Jun 2021

Posted by Nuetzel in Censorship, Social Media, Uncategorized

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Alphabet, Amazon, Anti-Trust, Biden v. Knight First Amendment Institute, Big Tech, Censor Track, Censorship, Clarence Thomas, Clubhousse, Common Carrier, Communications Decency Act, Daniel Oliver, Department of Justice, Exclusivity, Facebook, Fairness Doctrine, Gab, Google, Google Maps, Internet Accountability Project, Josh Hawley, Katherine Mangu-Ward, Media Research Center, MeWe, monopoly, Muhammadu Buhari, Murray Rothbard, My Space, Net Neutrality, Public Accommodation, Public Forum, Quillet, Right to Exclude, Ron DeSantis, Scholar, Section 230, Social Media, Statista, Street View, Telegram, TikTok, Twitter, Tying Arrangement

Factions comprising a majority of the public want to see SOMETHING done to curb the power of Big Tech, particularly Google/Alphabet, Facebook, Amazon, and Twitter. The apprehensions center around market power, censorship, and political influence, and many of us share all of those concerns. The solutions proposed thus far generally fall into the categories of antitrust action and legislative changes with the intent to protect free speech, but it is unlikely that anything meaningful will happen under the current administration. That would probably require an opposition super-majority in Congress. Meanwhile, some caution the problem is blown out of proportion and that we should not be too eager for government to intervene. 

Competition

There are problems with almost every possible avenue for reining in the tech oligopolies. From a libertarian perspective, the most ideal solution to all dimensions of this problem is organic market competition. Unfortunately, the task of getting competitive platforms off the ground seems almost insurmountable. In social media, the benefits to users of a large, incumbent network are nearly overwhelming. That’s well known to anyone who’s left Facebook and found how difficult it is to gain traction on other social media platforms. Hardly anyone you know is there!

Google is the dominant search engine by far, and the reasons are not quite as wholesome as the “don’t-be-evil” mantra goes. There are plenty of other search engines, but some are merely shells using Google’s engine in the background. Others have privacy advantages and perhaps more balanced search results than Google, but with relatively few users. Google’s array of complementary offerings, such as Google Maps, Street View, and Scholar, make it hard for users to get away from it entirely.

Amazon has been very successful in gaining retail market share over the years. It now accounts for an estimated 50% of retail e-commerce sales in the U.S., according to Statista. That’s hardly a monopoly, but Amazon’s scale and ubiquity in the online retail market creates massive advantages for buyers in terms of cost, convenience, and the scope of offerings. It creates advantages for online sellers as well, as long as Amazon itself doesn’t undercut them, which it is known to do. As a buyer, you almost have to be mad at them to bother with other online retail platforms or shopping direct. I’m mad, of course, but I STILL find myself buying through Amazon more often than I’d like. But yes, Amazon has competition.

Anti-Trust

Quillette favors antitrust action against Big Tech. Amazon and Alphabet are most often mentioned in the context of anti-competitive behavior, though the others are hardly free of complaints along those lines. Amazon routinely discriminates in favor of products in which it has a direct or indirect interest, and Google discriminates in favor of its own marketplace and has had several costly run-ins with EU antitrust enforcers. Small businesses are often cited as victims of Google’s cut-throat business tactics.

The Department of Justice filed suit against Google in October, 2020 for anti-competitive and exclusionary practices in the search and search advertising businesses. The main thrust of the charges are:

  • Exclusivity agreements prohibiting preinstallation of other search engines;
  • Tying arrangements forcing preinstallation of Google and no way to delete it;
  • Suppressing competition in advertising;

There are two other antitrust cases filed by state attorneys general against Google alleging monopolistic practices benefitting its own services at the expense of sellers in various lines of business. All of these cases, state and federal, are likely to drag on for years and the outcomes could take any number of forms: fines, structural separation of different parts of the business, and divestiture are all possibilities. Or perhaps nothing. But I suppose one can hope that the threat of anti-trust challenges, and of prolonged battles defending against such charges, will have a way of tempering anti-competitive tendencies, that is, apart from actual efficiency and good service.

These cases illustrate the fundamental tension between our desire for successful businesses to be rewarded and antitrust. As free market economists such as Murray Rothbard have said, there is something “arbitrary and capricious” about almost any anti-trust action. Legal thought on the matter has evolved to recognize that monopoly itself cannot be viewed as a crime, but the effort to monopolize might be. But as Rothbard asserted, claims along those lines tend to be rather arbitrary, and he was quite right to insist that the only true monopoly is one granted by government. In this case, many conservatives believe Section 230 of the Communications Decency Act of 1996 was the enabling legislation. But that is something anti-trust judgements cannot rectify.

Revoking Immunity

Section 230 gives internet service providers immunity against prosecution for any content posted by users on their platforms. While this provision is troublesome (see below), it is not at all clear why it might have encouraged monopolization, especially for web search services. At the time of the Act’s passage, Larry Page and Sergey Brin had barely begun work on Backrub, the forerunner to Google. Several other search engines had already existed and others have sprung up since then with varying degrees of success. Presumably, all of them have benefitted from Section 230 immunity, as have all social media platforms: not just Facebook, but Twitter, MeWe, Gab, Telegram, and others long forgotten, like MySpace.

Nevertheless, while private companies have free speech rights of their own, Section 230 confers undeserved protection against liability for the tech giants. That protection was predicated on the absence of editorial positioning and/or viewpoint curation of content posted by users. Instead, Section 230 often seems designed to put private companies in charge of censoring the kind of speech that government might like to censor. Outright repeal has been used as a threat against these companies, but what would it accomplish? The tech giants insist it would mean even more censorship, which is likely to be the result. 

Other Legislative Options

Other legislative solutions might hold the key to establishing true freedom of speech on the internet, a project that might have seemed pointless a decade ago. Justice Clarence Thomas’s concurring opinion in Biden v. Knight First Amendment Institute suggested the social media giants might be treated as common carriers or made accountable under laws on public accommodation. This seems reasonable in light of the strong network effects under which social media platforms operate as “public squares.” Common carrier law or a law designating a platform as a public accommodation would prohibit the platform from discriminating on the basis of speech.

I do not view such restrictions in the same light as so-called net neutrality, as some do. The latter requires carriers of data to treat all traffic equally in terms of priority and pricing of network resources, despite the out-sized demands created by some services. It is more of a resource allocation issue and not at all like managing traffic based on its political content.

The legislation contemplated by free speech activists with respect to big tech has to do with prohibiting viewpoint discrimination. That could be accomplished by laws asserting protections similar to those granted under the so-called Fairness Doctrine. As Daniel Oliver explains:

“A law prohibiting viewpoint discrimination (Missouri Senator Josh Hawley has introduced one such bill) would be just as constitutional as the Fairness Doctrine, an FCC policy which adjusted the overall balance of broadcast programming, or the Equal Time Rule, which first emerged in the Radio Act of 1927 and was established by the Communications Act of 1934. Under such a law, a plaintiff could sue for viewpoint discrimination. That plaintiff would be someone whose message had been suppressed by a tech company or whose account had been blocked or cancelled….”

Ron DeSantis just signed a new law giving the state of Florida or individuals the right to sue social media platforms for limiting, altering or deleting content posted by users, as well as daily fines for blocking candidates for political office. It will be interesting to see whether any other states pass similar legislation. However, the fines amount to a pittance for the tech giants, and the law will be challenged by those who say it compels speech by social media companies. That argument presupposes an implicit endorsement of all user content, which is absurd and flies in the face of the very immunity granted by Section 230. 

Justice Thomas went to pains to point out that when the government restricts a platform’s “right to exclude,” the accounts of public officials can more clearly be delineated as public forums. But in an act we wouldn’t wish to emulate, the government of Nigeria just shut down Twitter for blocking President Buhari’s tweet threatening force against rebels in one part of the country. Still, any law directly restricting a platform’s editorial discretion must be enforceable, whether that involves massive financial penalties for violations or some other form of discipline.

Private Action

There are private individuals who care enough about protecting speech online to do something about it. For example, these tech executives are fighting against internet censorship. You can also complain directly to the platforms when they censor content, and there are ways to react to censored posts by following prompts — tell them the information provided on their decision was NOT helpful and why. You can follow and support groups like the Media Research Center and its Censor Track service, or the Internet Accountability Project. Complain to your state and federal legislators about censorship and tell them what kind of changes you want to see. Finally, if you are serious about weakening the grip of the Big Tech, ditch them. Close your accounts on Facebook and Twitter. Stop using Google. Cancel your Prime membership. Join networks that are speech friendly and stick it out.

Individual action and a sense of perspective are what Katherine Mangu-Ward urges in this excellent piece:

“Ousted from Facebook and Twitter, Trump has set up his own site. This is a perfectly reasonable response to being banned—a solution that is available to virtually every American with access to the internet. In fact, for all the bellyaching over the difficulty of challenging Big Tech incumbents, the video-sharing app TikTok has gone from zero users to over a billion in the last five years. The live audio app Clubhouse is growing rapidly, with 10 million weekly active users, despite being invite-only and less than a year old. Meanwhile, Facebook’s daily active users declined in the last two quarters. And it’s worth keeping in mind that only 10 percent of adults are daily users of Twitter, hardly a chokehold on American public discourse.

Every single one of these sites is entirely or primarily free to use. Yes, they make money, sometimes lots of it. But the people who are absolutely furious about the service they are receiving are, by any definition, getting much more than they paid for. The results of a laissez-faire regime on the internet have been remarkable, a flowering of innovation and bountiful consumer surplus.”

Conclusion

The fight over censorship by Big Tech will continue, but legislation will almost certainly be confined to the state level in the short-term. It might be some time before federal law ever recognizes social media platforms as the public forums most users think they should be. Federal legislation might someday call for the wholesale elimination of Section 230 or an adjustment to its language. A more direct defense of First Amendment rights would be strict prohibitions of online censorship, but that won’t happen. Instead, the debate will become mired in controversy over appropriate versus inappropriate moderation, as Mangu-Ward alludes. Antitrust action should always be viewed with suspicion, though some argue that it is necessary to establish a more competitive environment, one in which free speech and fair search-engine treatment can flourish.

Organic competition is the best outcome of all, but users must be willing to vote with their digital feet, as it were, rejecting the large tech incumbents and trying new platforms. And when you do, try to bring your friends along with you!

Note: This post also appears at The American Reveille.

TikTok Tax: The Heavy Wants a Cut

05 Wednesday Aug 2020

Posted by Nuetzel in Industrial Policy, Regulation, Trump Administration

≈ Leave a comment

Tags

AOC, Barack Obama, CCP, Chinese Communist Party, Coyote Blog, Cronyism, Donald Trump, Hong Kong, Larry Kudlow, Likee, Microsoft, Muslim Uighurs, Peter Navarro, Regulatory State, statism, Steve Bannon, Taiwan, TikTok, Varney & Co, Video Sharing, Warren Meyer

I have a certain ambivalence toward Donald Trump, and I could go on and on about why it’s so “complicated” for me. One thing for which I’ve credited the Trump Administration is its effort to “deconstruct the administrative state”, as Steve Bannon so aptly put it shortly after the 2016 election. Of course, the progress thus far hasn’t always lived up to my hopes, but the effort to deregulate continues. And after all, the regulatory state is deeply entrenched and difficult to uproot.

Then my eyes glazed over as Trump floated an idea so bad, an intervention so awful, that I can hardly gather it in! It has to do with TikTok, the Chinese video sharing service that has gained popularity worldwide. Crazy as this might sound, it’s not so much Trump’s threat to shut down TikTok’s U.S. operations. Like most libertarians, I’d find that appalling in and of itself, except for the legitimate data security issues at stake. The company’s ties to the Chinese Communist Party (CCP) are a national security concern and an ethical blot on the company, given the CCP’s brutal treatment of Muslim Uighurs, its roughshod treatment of Hong Kong, and its threats to Taiwan. In any case, at least Trump said he’s amenable to a sale of the company’s U.S. operations to a domestic firm. Several large tech firms have expressed strong interest, including Microsoft. So, while any government imposed shutdown or forced sale makes me squirm, it’s not my main issue here.

What really stunned me was to hear Trump say the U.S. Treasury must get a cut of the deal! This is “Hall-of-Fame” statism. Where in the hell does the U.S. government get a legitimate financial claim to the value of any private business that changes hands? Well, Trump seems to think the federal government is adding value as the heavy:

“But if you buy [TicTok], the United States, which is making it possible to buy, because without us they can’t do anything, should be compensated.”

Yes, the buyer would be the beneficiary of a shakedown, and the demand is another poke in the eye to the Chinese. Of course, it might well threaten the transaction, and I’m not even sure it’s in Trump’s interest politically. But that’s not even the worst of it: as Warren Meyer explains, it would be hard to think of a better way to weaponize financial regulation than having the Treasury at the bargaining table in private negotiations for corporate control:

“Already there are too many regulatory hurdles to doing about anything, and Trump wants agencies to use regulatory approvals to hold up corporations for payments. And you can be sure this is a precedent the Democrats will be only too happy to latch onto — want a pipeline built, where’s our vig? Who wants [this to be] the first Trump decision AOC comes out in support of? The Republican Party sure has come a long way in my lifetime.”

The Left would certainly love to exercise this kind of coercion as a revenue source, as a cudgel of industrial policy to wield against disfavored firms and industries, and as a way to favor cronies. It’s a ready extension of Barack Obama’s deranged “You-didn’t-build-that” theme.

Is this one of trade advisor Peter Navarro‘s brainstorms? I was relieved to see Trump economic advisor Larry Kudlow cast some doubt on whether the government would follow through on Trump’s idea:

“‘I don’t know if that’s a key stipulation. …. A lot of options here,’ Kudlow told ‘Varney & Co.’ on Tuesday. ‘Not sure it’s a specific concept that will be followed through.’“

I think Trump would really like to kill TikTok. Maybe his grudge is driven in part by the presumptive role that TikTok played in his under-attended Tulsa rally. But there are domestic competitors to TikTok, so consumers will have alternatives. The most popular of those seems to be another Chinese app called Likee. In any case, downloads of other video sharing apps have spiked over the past few weeks. If Trump’s real aim is simply to shut down TikTok in the U.S., I’d almost rather see him do that than start making a practice of horse trading with cronies over shares of corporate booty.

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