Friday, April 22, 2016

Obama's crony capitalism.


WHEN PRESIDENT OBAMA announced his support last week for a Federal Communications Commission plan to open the market for cable set-top boxes — a big win for consumers, but also for Google — the cable and telecommunications giants who used to have a near-stranglehold on tech policy were furious. AT&T chief lobbyist Jim Cicconi lashed out at what he called White House intervention on behalf of “the Google proposal.”
He’s hardly the first to suggest that the Obama administration has become too close to the Silicon Valley juggernaut.
Over the past seven years, Google has created a remarkable partnership with the Obama White House, providing expertise, services, advice, and personnel for vital government projects.
Precisely how much influence this buys Google isn’t always clear. But consider that over in the European Union, Google is now facing two major antitrust charges for abusing its dominance in mobile operating systems and search. By contrast, in the U.S., a strong case to sanction Google was quashed by a presidentially appointed commission.
It’s a relationship that bears watching. “Americans know surprisingly little about what Google wants and gets from our government,” said Anne Weismann, executive director of Campaign for Accountability, a nonprofit watchdog organization. Seeking to change that, Weismann’s group is spearheading a data transparency project about Google’s interactions in Washington.
The Intercept teamed up with Campaign for Accountability to present two revealing data sets from that forthcoming project: one on the number of White House meetings attended by Google representatives, and the second on the revolving door between Google and the government.
As the interactive charts accompanying this article show, Google representatives attended White House meetings more than once a week, on average, from the beginning of Obama’s presidency through October 2015. Nearly 250 people have shuttled from government service to Google employment or vice versa over the course of his administration.
Photo: Paul Morigi/Getty Images
No other public company approaches this degree of intimacy with government. According to an analysis of White House data, the Google lobbyist with the most White House visits, Johanna Shelton, visited 128 times, far more often than lead representatives of the other top-lobbying companies — and more than twice as often, for instance, as Microsoft’s Fred Humphries or Comcast’s David Cohen. (The accompanying chart reflects 94 Shelton visits; it excludes large gatherings such as state dinners and White House tours.)
The information, Weismann said, “will help the public learn more about the company’s influence on our government, our policies, and our lives.”
Asked to respond, Google spokesperson Riva Litman referred The Intercept to a blog postwritten when the Wall Street Journal raised similar questions a year ago. In that post, Google said the meetings covered a host of topics, including patent reform, STEM education, internet censorship, cloud computing, trade and investment, and smart contact lenses. The company also claimed to have counted similar numbers of visits to the White House by Microsoft and Comcast — but it did not explain its methodology for parsing the data.
Google’s dramatic rise as a lobbying force has not gone unnoticed. The company paid almost no attention to the Washington influence game prior to 2007, but ramped up steeply thereafter. It spent $16.7 million in lobbying in 2015, according to the Center for Responsive Politics, and has been at or near the top of public companies in lobbying expenses since 2012.
But direct expenditures on lobbying represent only one part of the larger influence-peddling game. Google’s lobbying strategy also includes throwing lavish D.C. parties; making grants to trade groups, advocacy organizations, and think tanks; offering free services and training to campaigns, congressional offices, and journalists; and using academics as validators for the company’s public policy positions. Eric Schmidt, executive chairman of Alphabet, Google’s parent company, was an enthusiastic supporter of both of Obama’s presidential campaigns and has been a major Democratic donor.
For its part, the Obama administration — attempting to project a brand of innovative, post-partisan problem-solving of issues that have bedeviled government for decades — has welcomed and even come to depend upon its association with one of America’s largest tech companies.

GOOGLE DOESN’T JUST lobby the White House for favors, but collaborates with officials, effectively serving as a sort of corporate extension of government operations in the digital era.
In just the past few years, Google has provided diplomatic assistance to the administration through expanding internet access in Cuba; collaborated with the Department of Housing and Urban Development to bring Google Fiber into public housing; used Google resources to monitor droughts in real time; and even captured 360-degree views of White House interiors.
But perhaps most salient here is the fact that modern life requires so much information technology support that a sprawling operation like the White House has turned to tech companies — often in the form of ex-Google employees — when faced with pressing IT needs.
Practically every part of the government makes available some form of technology, whether it’s the public-facing website for a federal agency, a digital mechanism for people to access benefits, or a new communications tool for espionage or war.
Somebody has to build and manage those projects, and Silicon Valley firms have the expertise needed to do that. White House officials have publicly asked Silicon Valley for aid in stopping terrorists from recruiting via social media, securing the internet of thingsthwarting cyberattacksmodernizing the Defense Department, and generally updating all their technology. We can reasonably expect yet more things are being asked for behind closed doors.
toddparker
Photo: Philips Communications/Flickr
The disastrous launch of HealthCare.gov in October 2013 is the most obvious example. Within weeks of the site going live, Chief Technology Officer Todd Park, his top deputy Nicole Wong (a former Google deputy general counsel), and White House Chief of Staff Denis McDonough held meetings with Google personnel.
In Time magazine, Steven Brill detailed one of those meetings, between Park and Gabriel Burt, the chief technology officer at Eric Schmidt’s Civis Analytics. Civis was already working on Obamacare as a vendor for Enroll America, a nonprofit tasked with getting people subscribed on the insurance exchanges. Civis used reams of data to target communities with high levels of uninsured Americans so Enroll America could contact them. But now the site where they were supposed to sign up wasn’t working. So the White House turned to Civis for help with that as well.
Eventually, Mikey Dickerson, a site-reliability engineer with Google who previously worked on the Obama campaign, got hired to fix the site. Burt and Dickerson worked together to “form a rescue squad” for HealthCare.gov, according to Time. And most of the recruits came from Google. Later, Dickerson led the U.S. Digital Service, a new agency whose mission was to fix other technology problems in the federal government. Ex-Google staffers were prevalent there as well. Dickerson attended nine White House meetings with Google personnel while working for the government between 2013 and 2014.
Meetings between Google and the White House, viewed in this context, sometimes function like calls to the IT Help Desk. Only instead of working for the same company, the government is supposed to be regulating Google as a private business, not continually asking it for favors.
Much of this collaboration could be considered public-minded — it’s hard to argue with the idea that the government should seek outside technical help when it requires it. And there’s no evidence of a quid pro quo. But this arrangement doesn’t have to result in outright corruption to be troubling.
The obvious question that arises is: Can government do its job with respect to regulating Google in the public interest if it owes the company such a debt of gratitude?
Google doesn’t think its activities present an antitrust problem. It doesn’t feel constrained from holding incredible amounts of data. But should Google be in a position to make that determination itself? How much influence is too much influence?
Another potential conflict arises from the enormous amount of data that Google and the government each have stored on American citizens. Google recently acknowledged having mined the data of student users of its education apps, and has been accused repeatedly of violating user privacy in other contexts. An overly close partnership risks Google putting its data in the government’s hands or gaining access to what the government has collected.
When the federal government and a private company share the same worldview, get the same insights from the same groups of people, the policy drift can occur with nobody explicitly choosing the direction. It just seems like the right thing to do.
And there is no doubt that Google’s rise in Washington has coincided with public policy that is friendlier to the company.
Most notably, Google has faced questions for years about exercising its market power to squash rivals, infringing on its users’ privacy rights, favoring its own business affiliates in search results, and using patent law to create barriers to competition. Even Republican senators like Orrin Hatch have called out Google for its practices.
In 2012, staff at the Federal Trade Commission recommended filing antitrust charges after determining that Google was engaging in anti-competitive tactics and abusing its monopoly. A staff report that was later leaked said Google’s conduct “has resulted — and will result — in real harm to consumers and to innovation in the online search and advertising markets.”
The Wall Street Journal noted that Google’s White House visits increased right around that time. And in 2013, the presidentially appointed commissioners of the FTC overrode their staff, voting unanimously not to file any charges.
Jeff Chester, executive director of the Center for Digital Democracy, said the administration “has been a huge help” to Google both by protecting it from attempts to limit its market power and by blocking privacy legislation. “Google has been able to thwart regulatory scrutiny in terms of anti-competitive practices, and has played a key role in ensuring that the United States doesn’t protect at all the privacy of its citizens and its consumers,” Chester said.
At a congressional hearing earlier this month, Sen. Richard Blumenthal, citing the possibility of consumer harm, called on the FTC to reconsider the kind of antitrust charges against Google recently filed in Europe.
But Obama has argued that European regulators are being too aggressive toward Google out of a desire to protect companies that aren’t as capable. “In defense of Google and Facebook, sometimes the European response here is more commercially driven than anything else,” he told Re/code in February. “We have owned the internet. Our companies have created it, expanded it, perfected it, in ways they can’t compete.”

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