GUEST BLOG: Nick Dearden – Big Tech should be taxed and regulated – but the Davos elite wants to give Amazon and Facebook even more power

This morning a group of mostly rich countries used the World Economic Forum in Davos to call for negotiations on digital trade. This is ‘next big thing’ in trade talks: trying to create global rules to govern rapidly increasing online trade and accompanying flows of data (the so-called ‘oil’ of the new economy).

The massive rise in new technologies and online communications is transforming the world economy. And of course it’s true that new technology carries with it the power to transform many people’s lives, to help our efforts to wipe out poverty, deliver healthcare and education for all, and halt environmental destruction.

But, in the wrong hands, this technology can also do precisely the opposite. What’s being dubbed the ‘fourth industrial revolution’ at Davos is energising global corporations, as they look for new ways to harness our data, cut their costs and increasingly monopolise global trade. To create a set of rules which actually gives these big tech companies – from Facebook, Amazon and Google to new platforms like Uber and AirBnB – permanent power over these new technologies, anywhere in the world, would be a disaster.

Just like the ‘robber barons’ in the nineteenth-century US which monopolised new technologies like the railways to create the greatest fortunes the world had ever seen, so today’s ‘robber barons’ have captured technologies which will be needed for any country which wants to develop their economy in the next 20 years.

And this capture has resulted in vast wealth. The world’s richest man, Jeff Bezos, is now worth well over $100 billion, a fortune which increased by $24 billion last year. While the poorest half of the worlds’ population saw their wealth fall by 11% last year, Bezos is one of the global billionaires whose wealth grew 12% last year, according to Oxfam.

So technological change, grafted onto a world experiencing staggering levels of inequality, will only accelerate that inequality. We need to take action, in the way action was taken against the robber barons in America in the early twentieth century – regulating them, taxing them (and their owners), breaking them up where necessary, and investing in public development able to challenge these behemoths.

But this is not what so-called ‘e-commerce’ rules on digital trade will achieve. Far from it, the rules which are are currently being pushed by the Big Tech corporations reflect their desire to build their current dominance into online technology for the foreseeable future. The big tech companies are trying to set global rules precisely to prevent governments being able to regulate or tax them. They want to be able to extend their powers globally – preventing governments from being able to make demands on them, or from developing their own tech sectors which will be absolutely crucial to developing countries if they’re not going to have to pay increasing levels can of rent to these Silicon Valley giants as technology becomes more and more important to economic development. It will also give them enormous power over education and healthcare in low income countries, where technology, in private hands, is being use to usurp the role of governments.

This is why developing countries blocked the start of negotiations on digital trade at the World Trade Organisation just over a year ago. The push this morning at Davos is an attempt to get round this blockage by forming a ‘coalition of the willing’ prepared to push on with talks, and create some facts on the ground.

It’s important we push back against them. Few people deny the need for global rules. After all we  need rules to protect human rights online – to prevent repressive and authoritarian states from using online technology to increase censorship and surveillance of their citizens (something Britain is helping by selling surveillance technology to these regimes).

But talks by trade negotiators is not the way to formulate these rules. Trade rules are far too dominated by big corporations, and the self-interest of rich states. That’s why the WTO has extremely poor form when it comes to putting human rights and the right to development ahead of big business interests. The rules we need must be developed in a different forum, with a different starting point.

It’s appropriate that these rich country proposals have emerged from Davos – the away day of the global elite. As we’ve seen again this week, the Davos elite like to pretend they can solve all global problems – from climate change to inequality to human rights – all by carrying on with business as usual. We need to remember that they got the world into this mess in the first place, and only fundamentally different thinking can create a better future.

 

Nick Dearden is the director of Global Justice UK