Ten Steps to Create an Equitable, Sustainable, Pro-Worker Digital Trade Policy

Note: This blog post expresses personal views and in no way represents the views of my employer.

[Edited October 8, 2021]

We previously sketched out some high-level principles on what a new approach to digital trade policy might look like. Here we attempt to take these principles to the next level of specificity.

1. Equitable, sustainable, worker-centric digital trade policy begins with diverse representation in the processes of influencing digital trade policymaking. Digital trade policymaking has been far too driven by White people advocating for corporate interests. A place to begin is ensuring more diverse representation of interests and perspectives on Industry Trade Advisory Committees (ITACs) with the strongest influence over digital trade, e.g., ITAC 8. There should be explicit benchmarks for diversity of perspectives and interests on the ITACs, and dedicated outreach to underrepresented groups.
2. Pivot from a focus on expanding market access for those selling technology to ensuring more equitable access for users of it. During the COVID-19 pandemic, many technologies proved to be necessities rather than luxuries — for children (and adults) to learn, to access health care, to work or find a job, to buy groceries. And access to technology has been terribly unequal as long as there’s been technology. We should build provisions into agreements that commit parties to working to eliminate digital divides — where the commitments are not considered fulfilled unless the parties can demonstrate they are actively working to bridge those divides. We saw the smallest crack of a door opening to this in USMCA Article 19.14(e), with its call for parties to work together to promote access to tech for persons with disabilities. The New Zealand-Chile-Singapore Digital Economy Partnership Agreement (DEPA) pushed further in this direction — see its Module 11 on Digital Inclusion for “women, rural populations, and low socio-economic groups.” We could make a similar push in U.S. agreements, to include a focus on access for Black, Latinx, rural, and low-income Americans — and, even further, making those commitments enforceable.
3. Foster responsible use of technology. TPP and then USMCA took important steps to encourage digital economy policies that keep people safe, e.g., on data protection and privacy. Those should be pushed to be even deeper. Ideally, Congress would advance comprehensive federal privacy legislation that new trade commitments would reflect, but until then, agreements should push for the highest level of ambition — perhaps keyed to state laws in California or Virginia. On cybersecurity, commitments could be based on principles at the heart of new Executive Actions anticipated soon in response to hacks that have harmed workers across a wide range of industries. It is is equally important to ensure that technology — especially powerful emerging technologies — are being used in ways that uplift people rather than harm them. Here again, DEPA provides a toehold — Article 8.2(2) says that the parties “recognize the economic and social importance of developing ethical governance frameworks for the trusted, safe and responsible use of AI technologies.” We can push further by committing parties to working — in concert and on their own — to ensure that technology is never used to violate human rights and repress workers. Finally, U.S. trade policymakers should not include provisions shielding online intermediaries from liability for harmful activity on their platforms in trade agreements going forward.
4. Constrain Irresponsible Data Flows. There should also be a commitment, accompanying any data flow commitment, to carefully control exports of data to third parties that are likely to use the data to harm people.
5. Commit to cooperation on workforce development for the digital economy. DEPA took a crack at this for the cybersecurity workforce (Article 5.1), but parties can go deeper — committing to concrete programs of cooperation on workforce development for emerging technologies, with an emphasis on reaching segments of the population underrepresented in those industries.
6. Commit to protecting and enforcing labor rights in digital economy industries. We’ve seen recently that the digital workforce is at the leading edge of defining the future relationship between labor and capital. The parties to any new agreement should commit to upholding high standards of treatment for digital economy workers, including their right to organize.
7. Advance digital tax rules that ensure digital economy companies pay their fair share of taxes — and that those resources support participation of a broad range of workers in the digital economy. We would all benefit from a harmonized system of rules for taxation in the digital economy. It is equally important that digital companies pay taxes commensurate with the benefits they are reaping from access to markets and data. The Administration should give trade partners the space to demand digital companies pay their fair share of taxes, while doing the same within the United States. Proceeds of these taxes could then be invested in worker-focused skill development and competitiveness programs.
8. Promote the role of tech at the leading edge of pro-sustainability trade policy. Agreements should commit parties to cooperation on cross-border research, development, and trade in emerging technologies to address climate change, while incorporating a system of carbon border adjustments — if not for the whole economy at the outset, then for digital trade as initial sector of application. Tech ought to be well positioned to lead in this area, given the commitments many tech companies have made toward greening their supply chains.
9. Build cooperation on supply chain security and resiliency in emerging and critical technologies directly into trade agreements — with explicit recognition of the importance of bolstering domestic and allied/trusted partner production for critical technologies. Agreements might include preferential treatment for trade in intermediate goods and services in these critical supply chains, and flexibilities around subsidies.

10. Update TPA, TAA, and GSP to make digital trade more pro-worker:

Trade Promotion Authority.

i. New negotiating objectives should specific that U.S. trade agreements should foster more equitable access to technology and its benefits, as well as responsible and sustainable use of technology.

ii. TPA should require analyses of likely economic impact of trade agreements (akin to what is required in Section 105(c) of the 2015 TPA legislation) to address impacts on social groups, including Black, Latinx, and Working Class Americans. TPA should require disaggregated analysis specifically for digital trade, given the increasingly important role digital trade plays in driving the overall assessment of benefits and costs in such studies.

Trade Adjustment Assistance. Create new workforce development programs for working class and minority Americans likely to be most heavily affected by technology offshoring and digital transformation within the U.S. economy.

Generalized System of Preferences (GSP). Make it a condition of GSP eligibility that countries adopt practices that foster responsible uses of technology that uphold human and worker rights rather than act against them.