Technology policy

Would Other Countries Trust a U.S. Government-Controlled Silicon Valley?

We don’t trust state-controlled companies in China. Would it be different if we did more of the controlling?

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It is easy to see why Americans may be uneasy about Chinese technology companies. Setting aside recent policy efforts to ban or reorient Chinese apps like ByteDance's TikTok and Tencent's WeChat, Westerners worry that these companies may engage in certain activities on behalf of the Chinese Communist Party. Laws such as the Cybersecurity Law and Encryption Law do compel Chinese companies to share certain data with the government on request.

It's easy to see the threats that can emanate from a technology company that is openly aligned with a decidedly non-liberal state, particularly when it is viewed at a competitor or even an enemy. It may be harder to see these same threats coming from the companies or policies native to your own country.

At the same that the U.S. government is cracking down on Chinese technology companies, our legislature is considering new policies that would increase controls on American technology companies.

For example, the EARN IT Act would chip away at platform liability protections in the name of protecting children; if a company does not change its platform upon recommendation of a government panel, it would open itself up to major, possibly debilitating lawsuits.

Then there is the Law Enforcement Access to Encrypted Data Act. This one tries to get at the "unbreakable device" problem by compelling technology companies to … break devices. In other words, it wouldn't be enough for a technology company to provide standard forensic services to help law enforcement gather evidence from a secure device. If encryption stands in the way, well, developers will just have to compromise it.

These policies bring many downsides for Americans. Crude changes to Section 230 liability protections may result in more content filtering, not less, since platforms would have an incentive to be extra cautious. And of course, undermining encryption always comes at a cost to security, regardless of the justification.

One thing that goes less discussed is how such policies affect the reputation and competitiveness of American technology firms. Not only is Silicon Valley a key engine of U.S. growth and innovation, our technology platforms are viewed as ambassadors for American values and priorities, for better or worse. If people are suspicious of Chinese companies' links to the CCP, why wouldn't they also be worried about American companies' links to our political actors?

I hadn't thought too much about this dimension of proposed new tech controls until it was brought to my attention by Ashkhen Kazaryan of TechFreedom during our recent panel conversation on these bills for the James Madison Institute. She put it in the context of U.S. jurisprudence, but it's easy to see how the principle can be extended.

The EARN It Act purports to help crack down on child abuse online. Yet one of the reasons that prosecutors in these cases are even able to get evidence admitted is because technology companies shared it with the government on a voluntary basis. Defense attorneys had previously tried and failed to argue that tech companies have essentially been state actors, and therefore the defendants' Fourth Amendment rights to due process had been violated. If tech companies are in fact deputized as state actors by legislation like the EARN It Act, these legal arguments could hold more weight in court.

Might non-Americans also view things like the EARN It and Law Enforcement Access to Encrypted Data Acts as ways to cement American tech companies as de facto state actors? It's plausible. If it's not these two pieces of legislation in particular, it could be some other proposal to promote good-sounding goals like fairness or representation or national security. To Americans, these pretexts make perfect sense. To a non-American, it looks like another way to weaponize technology companies in ways that benefit state interests.

Actually, this is probably how much of the world has viewed our tech companies for a long time. Edward Snowden's revelations that Silicon Valley had been deputized as an ersatz surveillance agency for the intelligence community provoked outrage in the States—imagine how much more of a scandal this was for people in other countries that were caught in our web of snooping.

Years later, there is a renewed interest in pardoning Snowden—from President Trump of all people—for what many people view in retrospect as a very patriotic act. One of the controversial phone logging programs revealed through the leaks has since quietly folded for ineffectiveness. FISA reform has largely left the national consciousness. Unfortunately, it is a very good bet that the intelligence community still has access to most of the data from our tech companies that they want.

It may not be as "official" as in China, but American tech company's the impression that American tech companies serve the interests of the US government is surely not an uncommon opinion in much of the world.

It's worth keeping this in mind as we debate new controls on technology companies. This is not to say that legislation is never warranted. Rather, we should scrutinize proposals to distinguish public-minded rule-making from government-interested controls. If we don't, we shouldn't be surprised if American companies come to be more generally viewed as another, perhaps more liberal, flavor of government-aligned actors.

NEXT: Today in Supreme Court History: August 18, 1920

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  1. It took all of 15 years for Democrats to turn the Patriot Act- including FISA courts, deals with other countries’ intelligence programs, and mass surveillance- into a weapon used against GOP adversaries. How long until they use laws that allow the government to declare what is “fair” or “truth” to move more and more conservatives off platforms?

    Have no doubt that any law requiring Facebook and Twitter to be “fair” in their moderation policies will require a government panel to first define the meaning of “fair”. Tech companies love this because they already have a millionaire employees helping to elect exactly the people that will appoint these panels.

    I hate the way tech companies have become radicalized. But there is no quick fix for this. The Left’s long march through the institutions is not going to be stopped at the last minute by those same institutions. But it can be stopped by the choices of millions of Americans who are given choice in a market that is free to innovate and disrupt. You just need to give them the time to move.

    1. I don’t know you if you were around when it passed, but the early, strongest opposition to the bill and the provisions you note were…from the left (remember it’s the bill Michael Moore criticized in his 9/11 movie).

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    2. Have no doubt that any law requiring Facebook and Twitter to be “fair” in their moderation policies will require a government panel to first define the meaning of “fair”. Tech companies love this because they already have a millionaire employees helping to elect exactly the people that will appoint these panels.

      The trials we see now are because Congress, by one specific law, gets to decide what constitutes ‘in good faith’. Sure, without that law, they’d probably find some other way to harass people and hold show trials, but tech would be backstopped by a primary right to tell them to go fuck themselves.

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    3. The solution is to treat Facebook, YouTube, Twitter, etc. exactly like phones or mail.

      Declare that they’re not liable for anything posted, and if there’s lawbreaking the courts and/or the cops take it down. Not Zuckerberg or Dorsey or some pimply Marxist kid in the PR department.

      By the same token they should expect that if they’re afforded immunity from liability, they can’t censor or limit speech either.

      1. This sounds about right, with the possible exception of DMCA takedown notices. The tech companies might still have to respond to those. But I absolutely agree with the first and last lines.

    4. Overt, you’re describing the 230 status quo.
      Let people make their cases in front of juries like everyone else

  2. And by the way, if you think that certain GOP senators supporting any of these laws is an endorsement, you are crazy. I saw what happened here in California first hand as the GOP capitulated to Democrat gerrymandering under the logic that they would rather secure for themselves a permanent minority in a handful of safe GOP seats (while giving Dems a safe majority) than to constantly fight over contested seats.

    People like Lindsey Graham have never seen a problem that their brand of government couldn’t fix. When they are supporting broken encryption, they are supporting exactly the system that Democrats used in 2016 to target Trump.

    Broken encryption laws are like gun control laws. They will not stop foreign governments or bad actors from using strong encryption. Those people break or disregard our laws regularly. No, such rules can only target law-abiding americans. They do not want US to have strong encryption, because one day WE may challenge their privileged spot, as Trump did, and they will need everything in their considerable power to take us out of their way.

    1. The partisan hacks will be along any minute, both deranged by Trump, but the real problem, the core fundamental root problem, is government control, period. Just as all the partisans piled power after power into the executives (President, governors, mayors) when they were in control, and now we’ve got governors and mayors crippling the economy over a run-of-the-mill virus, and a President banning products, companies, and countries with his phone and his pen. Not a single partisan admits any mistakes were made; they only care that the power remain in place so a change in Top.Men will fix things Next Time.

      Government is always the problem, never the solution.

      1. So explain how a cartel of multinational companies acting as censors and allies or one political cause at the expense of every dissenting cause is a problem of “government control”? Do you not think it is a problem or do you think that it is really the government that is forcing these companies to act in the ways they do?

        As far as your claims about the evil political hacks attacking the sacred tech company, that claim would be a lot more compelling if the tech companies didn’t happen to be going after the very people you hate. It is quite easy for someone like you to talk about the wonders of the tech companies when they are using their power to oppress people you want to see oppressed anyway. It is quite a gift to people like you. It allows you to support censorship and oppression but still have the fig leaf of not supporting the government doing it. The day the tech companies deplatform someone you like and support and you still say the things you are saying, is the day I will believe you actually think what you claim and are not just rationalizing your own self interest.

        Even if you really do believe these things, your position amounts to just a restatement of the assertion “the private sector can never do wrong and any result from it is better than any intervention by government”. And that just makes you a species of Utopian similar to leftists. They think the government can do no wrong and you think the private sector can do no wrong and Utopia will be achievable if only we could allow the “market”, that magical machine that rights all wrongs” operate in it’s pure form.

        1. How are these tech companies ‘oppressing’ people?

          1. By creating cartels and making it impossible for anyone with an unpopular or dissenting message to have access to mass public forums. If the government were running these companies and kicking people off, your response wouldn’t be “they are not oppressed since they are always free to form their own Facebook”.

            The fallacy here is that you people refuse to believe that these companies do not act as a defacto cartel. The story of Gab, a company where someone really did make their own Twitter shows how naive or willfully stupid you people are being. There, Gab is constantly harassed, has banks refuse to do business with it, and floats from one platform to the next as each provider is pressured into refusing to do business with it by the large tech companies. Sure, it still by the will of the operators alone exists, but it will never be a threat to the larger companies.

            1. It’s like you’re complaining you’re oppressed because no major fast food firm is offering the szechuan sauce for chicken nuggets you like.

              1. No, It’s like complaining that the huge fast food firms are trying to put the business that offers the szechuan sauce for chicken nuggets I like out of business.

                1. all I want is a Szechuan Nuggets in our neighborhood without Faceburger ruining things

              2. What a lousy analogy.

                If the fast food companies banned szechuan sauce and forcibly censored anyone sharing recipes, then it’d be a little more accurate.

            2. “By creating cartels and making it impossible for anyone with an unpopular or dissenting message to have access to mass public forums.”

              Yet here you are, bloviating on Reason.com’s dime… For FREE!!! What kind of access do you want? Do you want Government Almighty’s guns and jails to FORCE the TV stations and Facebook etc. to broadcast YOUR stuff, ’cause Reason.com posting isn’t enough? HOW MUCH is enough, John?

              And you REALLY think that Government Almighty meddling… When all of their lawyers and toadies are trained in “PC” in the schools these days… Is going to be “fair” to conservatives? If so, I have some prime real estate in Florida to sell to you!

              1. Of course you think being able to talk on a forum no one reads is all that matters. It makes sense. You have no life and you are a moron. What else would matter to you?

                For the rest of the world the ability to operate on social media is essential if you want to run a business or anything that requires marketing. And these companies now have the ability to ban anyone whose views they don’t like and make it effectively impossible for them to market themselves or whatever business they are running.

                If you were not retarded and could hold a steady job and move out of your mom’s basement, you might understand what is going on better.

                1. There is a big difference between seeing a problem and deciding that government is the only way to solve it. I know you think it isn’t possible, but alternative’s do exist and the best way to stop an alternative is to get the government to control what is fair.

                  A smart monopolist will advise a very expensive solution and then ensure there is a government department to license all new competitors. Of course this new department will be run by people with the “technical know how” to craft truly fair rules. How will we know that? Oh because he worked at Facebook/Google/Twitter for 15 years before joining the department. They will millions of dollars of funding from their former employers who are also spending hundreds of millions lobbying their current bosses. How can you look at things like healthcare and education and decide that making a government department to decide what fair is on social media will end up the way you hope?

            3. Your argument stems from the premises used by many socialists that you have not only a right to negative freedoms, but a right to claim material equality. It is no surprise that your conclusion from this premise is to grow government accordingly. This logic, consistently applied, also leads to free college, free healthcare, and all kinds of stuff to which the audience around here will not be very receptive.

              Your use of the word “cartel” seems to be misapplied. Cartels are designed to be unavoidable. I have gone twenty years on the Internet without ever signing up to use Twitter or Facebook and I sure don’t feel “oppressed.” These services may provide some useful functions but they are certainly not essential to gain value from Internet access.

              1. My argument has nothing to do with negative rights. If you think it does, it is because you don’t understand what I am saying. Saying that a group of people should not be able to control a market such that competition and choice no longer exist does not imply any negative rights. You don’t understand the point or more likely are not honest enough to address it properly and are creating a straw man.

                And you have gone that long without using those because you don’t run a business. If you ran a business today, you would have to use those services to remain competitive and reach your customers. I don’t buy diamonds either. That doesn’t mean DeBeers isn’t a monopoly you fucking half wit.

                1. You misread my comment. What I said is that your argument relies on a right to claim material equality. Your last paragraph only confirms this. Entitled whiners like you are the reason why Bernie Sanders has become so popular. Perhaps you mean to sign up for the Vox comment section?

                  1. Facebook, Twitter and Google didn’t naturally evolve out of the primordial internet goo. They lobbied, bribed and exploited regulations to get to where they are today.
                    Government also let’s them have their cake and eat it too, by giving them the rights of both publishers and utilities with the responsibilities of neither.

                    So essentially government gave them the vast powers that they now have, regulations stifled competition against them, and government largess enriched them, but you’re saying correcting that would be a misuse of government power?

                    1. I’ll have to pause to ask some questions because I may not be familiar enough with the tech industry. What exactly are those vast that government has given Facebook, Twitter, and Google? Which regulations are in place that has shielded them from competition?

                      According to my memory, the 90s and 00s were a time during which many websites provided various services in equal competition with each other, and by 2010 we were left with a world in which Facebook, Twitter, and Google rose to become the most successful of these websites. What did the government do to facilitate this success?

                    2. Prevent people from being able to sue them

              2. Makes no difference if you never signed up to use Twitter or Facebook. If you say one thing out of line within camera range, the twitter mob will come after you and yours. If you try to defend yourself? Well you wont have access to Twitter, You Tube, Google, Blogger, Instagram, Facebook, Paypal, Uber or Lyft to do so.

                1. This is what all the idiots saying “I never use Facebook so I don’t care” seem to miss. It doesn’t just stay on the platforms, but comes roaring into the real world too.
                  So sure, they might not be interested in the gleichschaltung, but the gleichschaltung is still very instead in them.

                2. It makes a big difference if you are trying to claim victimhood. His claim was that he was oppressed because Twitter and Facebook are so prominently featured in Internet discourse.

                  We get it. You hate college campus culture. That doesn’t mean you are oppressed. And it certainly doesn’t mean that the government needs to nationalize the Internet to fight your culture war for you.

            4. Your economic and historical knowledge is abysmal. You ought to read up on the history of cartels, how short-lived they are, with the only true monopolies being government-created ones.

              Remember MySpace? Alta Vista? Yahoo? WalMart? IBM? Standard Oil?

              All reviled by government and competitors and cronies. None of them true monopolies. All met their demise at the hands of competitors.

              1. Cartels are often not short lived at all. They showed no sign of ending in the lat 19th Century and were broken up by the government. DeBeers has held a monopoly on international diamond trading for over a century.

                My knowledge is quite good actually. Unlike you, I actually look at events instead of just talking points. You don’t know anything about how monopolies work except that someone told you they never last and you find that convenient to claim now. They don’t always last but there is nothing that says they cannot and do not occasionally endure for very long periods of time.

              2. Forget OPEC?

                1. OPEC doesn’t fit into the list of corporations subject to USA Government Almighty’s control, unless we want to fight more endless stupid wars… Slap an anti-trust lawsuit against OPEC? Good luck with that!!!

          2. How are these tech companies ‘oppressing’ people?

            How is a policy of ‘separate but equal’ oppressive?

        2. Also, the ‘private sector’ is just people making voluntary exchanges, so, yeah, it’s hard to see how they could do much wrong.

          1. Sure it is. But what makes you think such decisions are always going to be good? If the country collectively decided to embrace rational segregation and white supremacy again, that would be a private sector action. That fact wouldn’t make it a good result.

            1. Isn’t this just a ‘I think everyone else is phony and stupid and bad’ complaint? It reminds me of my vegan friends ‘everyone is ‘freely’ choosing to oppress these animals because of their ‘tastes’

              1. No it is not. It is a statement that human nature is imperfect and humans are capable of doing horrible things without the help of government. This is why Libertarians are so similar to communists. Communists believe that man can be perfected by government. Libertarians believe that man can be perfected by being left alone. Both fallacies are equally wrong and when taken to extreme equally dangerous.

            2. Private companies go out of business. Government does not.

              1. Large corporations often outlast governments. Governments go out of business all the time. They are called revolutions or elections.

                Beyond that, your point is completely non responsive to my point. Societies are often collectively much more nasty than government. There is nothing about private action that makes it necessarily better than government action.

        3. Truth. Anyone who thinks the free market will fix all ills clearly hasn’t thought much through. People will always be giving up their power one way or the other- either to government or corporations/the market. That power is best diffused and set against each other- not single handedly given to one or the other in its entirety.

          1. “That power is best diffused and set against each other- not single handedly given to one or the other in its entirety.”

            It is unfortunate that you think putting that power in the hands of the government will somehow create the adversarial environment you prefer. Make no mistake: The left wants you to think that because they are better at corrupting institutions than you are. You want to go to work and live life. To most on the Left, “Living Life” means invading and coopting these institutions.

            Again, look at how the GOP sold out “Adversarial” government at the state level for “Safe Minority”. That is the end game if you keep advocating more power for the government.

        4. “As far as your claims about the evil political hacks attacking the sacred tech company, that claim would be a lot more compelling if the tech companies didn’t happen to be going after the very people you hate. ”

          Doesn’t the same logic apply to you John? Is it just a coincidence that you are railing against platforms that have an obvious bias against conservatives? Or would you be as principled if they were censoring Antifa or Huffpost?

          For the record, I have said numerous times that YouTube and Facebook should not be pulling anyone- left or right. But I also believe it should be their right to censor as they choose.

        5. I have never said the private sector does no wrong. I have always said the private sector is held accountable by customers and investors and can go bankrupt. Government can’t. That is the fundamental difference.

          I don’t believe you are that stupid. But your pretending to not understand it makes you as duplicitous as the TDS victims on the left.

          1. I have never said the private sector does no wrong. I have always said the private sector is held accountable by customers and investors and can go bankrupt. Government can’t. That is the fundamental difference.

            That is just saying that the private sector will right every wrong. which is another way of saying the private sector does no wrong. Sure bad things happen but the magic market will always bring justice for those bad things.

            You are no better than a leftist. You just worship this fantasy you call “the market” and leftists worship a fantasy called “government.

            1. So you want to fix the fantasy called the “market” with the fantasy called “government”. Makes “sense”

      2. Run of the mill? So virtually every nation and their health experts freaked out over what was obviously a run of the mill virus? That strikes me as some pretty heavy conspiracy type thinking.

        1. No its totally true. Business and governments all over the world are voluntarily forfeiting billions of dollars in sales/tax revenue just to make freedom-lovers cringe!!

        2. It has so far killed far fewer deaths than several previous pandemics. There is no correlation between lock downs / mask mandates and the rate of infections or deaths. There is an absolute cause and effect relationship between government lock downs and economic depression.

          If you want to pretend you can’t connect the dots, go ahead. But others can both see and connect the dots, making you just another mindless statist control freak.

      3. You’re saying my idea for a perpetual-motion machine won’t work? Well, fine, let’s see your plan for a perpetual-motion machine! You ain’t got one, do ya, smart guy. So you can just shut the hell up about how my perpetual-motion machine ain’t gonna work until you come up with one of your that you can prove does work.

      4. Yeah no doubt people are blinded by power. I was for years. It took me around 15 years to make the journey. The government really is the One Ring, and its treachery isn’t in the evil that it represents, but the evil that it brings out of the hearts of each and every person who would wield it. Time and again, person after person takes up the ring with the noblest of intentions only to see their will undone.

      5. Well, anyone find it odd that this piece had to specify “U S” Government Control? Because the government controlling most of them isn’t ours

  3. “Would Other Countries Trust a U.S. Government-Controlled Silicon Valley?”

    The question should be “Would Other Countries Trust a Silicon Valley-Controlled U.S. Government?”

    1. The other question is if the US doesn’t control these companies, what makes reason thinks other countries will not? I don’t think these companies acting outside the control of any government is even an option much less a desirable one. So the issue is if not the US then who? Someone will it is just a question of who.

      1. True enough. Better the devil you know (US) than some other (EU) devil.

      2. That right there is the issue that libertarians really need to honestly grapple with as a party. Our own government is not the only danger to operating in a free market. Other government will use the force of their laws to control companies to behave in ways within our own borders that they would not if we existed in a truly free market.

        How a libertarian government should deal with this problem needs to be openly debated. Should we use political pressure to get other governments to back off, should we sanction, should we punish businesses that try to comply with other governments to make it just as painful to bend the knee as to stand up?

        Ignoring it just makes us look stupid though. Like a city governor pretending his city has a completely free market while ignoring how federal regulations distort the market. How do you deal with government regulations distorting the market is a legitimate libertarian question even with the government in question speaks Chinese.

        1. For years people railed against companies that used “Sweat Shop Labor”. Yahoo famously divested its entire market in China to deal with the fact that Chinese authorities were forcing them to give information on dissidents. Market activism actually changed company policies.

          It is baffling to me that in this country- where governors and federal authorities alike happily endorse the mass imprisonment of all citizens in their homes for a cold virus- that people really feel like our government can be trusted with this power!

          Yeah, it is unfortunate that there are even worse governments out there. The answer is transparency and advocacy. This desire to cede everything to the government is making our population less resistant to liberal bias. Rather than starting charities and watchdog groups, they are starting NGOs that lobby the government for change.

          1. During my state’s harshest ‘stay at home’ order I freely: walked my dog for miles in my neighborhood and at parks that were still open; went to the grocery store; got take out, ate it at parks with my family; went to Lowes; went on scenic drives for miles.

            Mass imprisonment indeed. Maybe back off the hyperbole.

          2. And Yahoo has been slowly dying for a decade now. It’s not a good example for how companies can choose to not cave to Chinese authority.

      3. That question has already been answered by China

  4. We don’t trust state-controlled companies in China. Would it be different if we did more of the controlling?

    What an absurd question. Other governments already don’t trust Silicon Valley companies because they know that Silicon Valley is in bed with US intelligence services, just like their own big corporations are in bed with their own intelligence services. Beyond already not trusting Silicon Valley companies, they simply want a slice of the pie and want to use those companies for their own propaganda purposes.

    1. Do you really think Silicon Valley companies are ‘in bed with’ US intelligence services to the same extent or degree as other nations (like China’s) companies and services?

      1. Yes. I can tell you that as a fact. US Surveillance entities literally have equipment inside the data centers of these major companies that is interdicting and monitoring user traffic.

      2. Do you really think Silicon Valley companies are ‘in bed with’ US intelligence services to the same extent or degree as other nations (like China’s) companies and services?

        To what extent do you think this would be OK? If the Chinese companies follow orders and hand over data but Americans make them say “Pretty please!” first, you’re cool with that?

      3. The question was “will foreigners trust SV if…”. So what matters is not what I believe but what foreigners believe. Europeans believe that the US government and Silicon Valley are far worse than European governments and European companies when it comes to privacy.

        Personally, I don’t believe there is much difference.

  5. One good thing is the idea of open borders and multi national corporations growing ever larger is going to end this century. China walloped us with a virus (and our overreaction didn’t help) but that will spell the end for unfettered cross border travel, large cities, and global titans of industry. I think we’ll be far better off.

  6. ” China walloped us with a virus”

    I guess it’s happy we dodged South Sudan’s ebola attempt.

  7. Actually, this is probably how much of the world has viewed our tech companies for a long time.

    We don’t have to say “probably”, we know that the EU, for example, has had a long standing distrust of American-dominated tech companies.

    Hell, the French were so incensed at google as a search engine, the government proposed developing a French-centric search engine about 15 years ago.

    1. The French satirical newspaper Le Canard enchaîné pointed out that the funding behind the project was dwarfed by both Microsoft and Google. Search experts Autonomy, (Financial Times) called the plan “a blatant case of misguided and unnecessary nationalism”. The main issues being that: by the time of Quaero’s launch, the search engine market would already have been generations ahead of Quaero in media and device capabilities; some argue that Chirac was more interested in defending French pride than global advancement of the Internet.[8]

      Writing in IEEE Spectrum, Nick Tredennick commented that “Going head-to-head with Google with a project involving well-funded, energetic entrepreneurs would be foolish. Attempting the same with a multigovernment collaboration is beyond description.” [9]

  8. It’s more like Software Valley now. All the silicon is made in Taiwan.

  9. Post Snowden, why would we trust any tech company? After all, paranoid is only smart if they’re out to get your data.

  10. The more applicable question is “Would other countries trust a Silicon Valley-controlled US Government?”

  11. “It may not be as “official” as in China, but American tech company’s the impression that American tech companies serve the interests of the US government is surely not an uncommon opinion in much of the world.”

    what a horrible sentence.

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