Privacy Law

Trump allies propose nationalizing Facebook, Google data

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After President Donald Trump railed against Google for an anti-Trump news bias last week, his allies are arguing for a nationalization of data held by major American technology companies, raising questions about the role trusts and fiduciaries could play in the data economy.

“There’s a thought that given the enormity of these corporations, and this is a public square today,” said Fox News host Laura Ingraham on her show last Friday. “This is the equivalent of what we used to see in the old town square was people with a bull horn. And so could there be a movement to treat them more like public utilities, so they have some quasi-government oversight of these entities?”

The comments come days after Trump tweeted that Google search results were “rigged” against him and other conservatives. While there are demonstrable biases in Google search results, the idea that Google Search shows a partisan bias has been roundly debunked.

In an economy where commentators often refer to data as the “new oil,” ex-White House chief strategist Steve Bannon, a self-proclaimed economic nationalist, laid out a plan for the state to take control of the world’s newest commodity during a CNN interview last week.

“I think you take [the data] away from the companies. All that data they have is put in a public trust. They can use it. And people can opt in and opt out. That trust is run by an independent board of directors.

“It just can’t be that [big tech companies are] the sole proprietors of this data … I think this is a public good,” he said.

In the U.S., financial collapse and war have led to the nationalization of banks, railways and steel mills, but usually temporarily. During the Great Recession, for example, the federal government took a controlling stake in General Motors only to sell it back after the auto manufacturer stabilized a few years later.

At its core, a trust is a “legal contract that appoints a steward to oversee a type of property for the benefit of a specific person or group,” explains Sean McDonald, principal at Digital Public, an organization that helps establish digital trusts.

Trusts can be used for personal, community and national wealth, like pension funds and national parks. However, unlike these assets, data is different, explains McDonald.

“Technically, it can be difficult to trace the supply chain of data, or to prevent its misuse once shared, making it difficult to know exactly how trusts will prevent bad actors,” he says. “Practically, data is one of the most speculative asset classes in the world, so companies and their shareholders are reticent to participate in any structure that might limit their future ability to use data.”

He also adds that even though many of the companies are based in the U.S., they have user data from all over the world, which is distributed globally across their servers, “so traditional theories of nationalization get complicated quite quickly.”

Regardless of technical challenges, Bannon’s idea is a reaction to broader public mistrust of big tech. A Pew Research poll from June found that only 24 percent of people think tech companies “do enough to protect the personal data of their users,” and 51 percent would like to see greater regulations placed on the tech giants. At the same time, the research said nearly two-thirds of Americans believe that tech companies have had a net positive impact on society as a whole.

One alternative to Bannon’s prescription is a proposal to create an information fiduciary, which law professors Jack Balkin and Johnathan Zittrain proposed in an article in The Atlantic from 2016.

They believe a national policy could help companies take on the role of an information fiduciary, which would lead to better data protection, similar to what the Digital Millennium Copyright Act accomplished for copyright law. This would require companies, for example, to take on security and privacy guarantees, a promise to not use data to discriminate against users, and an agreement to only engage in selling of user data to companies playing by the same rules. In trade, companies would benefit from the federal law, which preempts the current patchwork of state and local law and liabilities.

“This grand bargain offers a clear and plausible path to implementation that can benefit all sides in a digital world that is still evolving,” they wrote.

With 60 days before the next congressional election, there is unlikely to be movement on either proposal. However, with tech and data’s growing role and increasing public angst, the issue is unlikely to go away.

“I think by the time 2020 comes along, this will be a burning issue,” said Bannon. “I think this will be one of the biggest domestic issues.”

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