With help from Leah Nylen
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— Battle lines drawn on America COMPETES: House Democrats hope to pass their enormous new anti-China competitiveness bill this week — with or without GOP support.
— DOJ pushes judge on Facebook: The Justice Department tells a federal judge he made some mistakes when dismissing a state-led antitrust case against the social media giant.
— Bedoya gets a do-over: After deadlocking in December, Senate Commerce will vote again this week on the nomination of Alvaro Bedoya to round out the Democrat’s FTC majority.
IT’S MONDAY, JAN. 31. Welcome to Morning Tech! Brendan Bordelon here — it’s my first time flying solo as your MT host, so please excuse any bumps or turbulence. Don’t worry, we’re gonna land this plane together!
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ANTI-CHINA COMPETITIVENESS BILL TOPS HOUSE AGENDA — An aide to House Democratic leadership tells MT that Democrats are ready to move this week on a floor vote for the America COMPETES Act, H.R. 4521 (117). But House Republicans, angry at being shut out of negotiations on the new bill, are likely to make things difficult.
Last week’s introduction of America COMPETES, the long-awaited companion legislation to the Senate’s sprawling U.S. Innovation and Competition Act, S. 1260 (117), came as a surprise to many — including top Republicans on key House committees like Energy and Commerce, Science, Ways and Means, Foreign Affairs and Financial Services. In a call with reporters, GOP staffers representing those committees laid out a laundry list of policy grievances and said House Speaker Nancy Pelosi’s decision to move forward without Republican input poisoned a previously bipartisan effort to shore up U.S. competitiveness vis-a-vis China.
— 99 problems (and CHIPS may be one): House Republicans are crying foul over large swathes of the bill, including the addition of the EAGLE Act, H.R. 3524 (117), — legislation addressing a broad slate of foreign policy challenges posed by China that passed out of the House Foreign Affairs Committee in July with no Republican votes — and a raft of trade provisions. Plans in COMPETES for a $45 billion program to make supply chains more resilient have also raised eyebrows among E&C Republicans, and GOP lawmakers on the Financial Services Committee are worried proposed monitoring requirements for cryptocurrency transactions could cripple the burgeoning industry.
Republicans even questioned the popular plan to boost domestic semiconductor production under the CHIPS for America Act (H.R. 7178 (116)). Staffers on House Science raised doubts about a new provision in America COMPETES that would let the Commerce Department offer loan guarantees to chip manufacturers. The staffers also noted House committees never actually vetted the $52 billion in chip subsidies found in both the House and Senate bills. Moving that money out the door quickly is a top priority for President Joe Biden and Commerce Secretary Gina Raimondo.
— House Democrats sanguine: The aide to House Democratic leadership said Republicans are only digging in their heels in an effort to deny Democrats a win on a popular bill. The aide said Democrats are focused on crafting legislation that can get 60 votes in the Senate, and suggested they’re prepared to pass America COMPETES with little to no GOP support and kickstart what’s likely to be a thorny conference process between the chambers. The aide spoke on condition of anonymity because they were not authorized to speak publicly.
But House Republicans will also be at the conference table. And even if America COMPETES passes the House this week, GOP staffers warned the partisan nature of the legislation’s introduction could cause more conflict when the two chambers meet — potentially delaying subsidies for chipmakers by several more months.
DOJ: JUDGE MISTAKEN ON FACEBOOK’S MONOPOLY MOVES — The Justice Department is urging a federal appeals court to rectify what it views as errors in its decision to dismiss a state-led antitrust suit against Facebook — an effort which could also help the FTC’s case against the company.
In an amicus brief signed by Assistant Attorney General for Antitrust Jonathan Kanter and filed late on Friday, DOJ prosecutors said U.S. District Judge James Boasberg failed to consider how Facebook’s actions overlap to cement a social networking monopoly. Boasberg, an Obama appointee, separated claims about Facebook’s acquisitions of Instagram and WhatsApp from allegations that the social network cut off rivals’ access to its platform, prosecutors said. (Those actions, the prosecutors argued, had reinforced each other to keep potential competitors from reaching the users they would’ve needed to grow.)
“By separating the acquisitions from the rest of the monopolization claim, the district court may have overlooked the full potential for anticompetitive effects,” the DOJ lawyers said. “By thwarting emerging competitive threats from app developers, Facebook’s policies allegedly prevented app developers from creating (or contributing to the creation of) superior technologies that could erode Facebook’s monopoly.”
The prosecutors also took issue with Boasberg’s statement that nothing can now be done about Facebook’s access policy, since the company later changed it. Courts can order a “reparative injunction” that requires Facebook to take certain actions to help restore competition in the market, they said. The prosecutors noted that Microsoft, in its own antitrust case, was required to make certain retroactive disclosures so rivals could ensure their software operated properly.
TAKE 2 FOR BEDOYA AT FTC: With Democrats and their allies increasingly anxious over the ongoing failure to secure an FTC majority, on Wednesday the Senate Commerce Committee will vote — again — on privacy advocate Alvaro Bedoya’s nomination to serve as the third Democrat on the Federal Trade Commission.
The do-over comes after the committee split 14-14 on Bedoya’s nomination in December, with every Republican senator voting against the Georgetown Law School professor’s nomination. Several Republicans, including ranking member Sen. Roger Wicker (R-MS), took umbrage at Bedoya’s “divisive” social media presence.
The deadlock would’ve required Sen. Majority Leader Chuck Schumer to expend valuable floor time on a discharge petition to force a floor vote on Bedoya. But Bedoya’s nomination expired before that could take place. Biden renominated Bedoya on Jan. 4, along with Gigi Sohn (her nomination to serve as Democratic commissioner at the Federal Communications Commission will receive its first vote on Wednesday).
— Delays on delays: There’s little indication that Wednesday’s vote will be much different for Bedoya than the one in December. With the Senate already staring down a packed calendar, the prospect of a significant delay on Bedoya’s nomination throws into doubt the ambitious plans rumored to be brewing under FTC Chair Lina Khan’s leadership. In addition to serving as a crucial third Democratic vote, Bedoya — a privacy expert — will likely play a key role in any eventual privacy rulemakings at the FTC.
In the meantime, privacy advocates are growing antsy. In a letter sent Friday to Senate Commerce Chair Maria Cantwell and first shared with MT, nearly twenty children’s privacy groups urged senators to confirm Bedoya posthaste.
TELECOM INDUSTRY URGES ‘BUY AMERICAN’ OPT-OUT: A coalition of telecommunications industry lobbyists wants the Biden administration to waive “Buy American” requirements in the recent bipartisan infrastructure law for certain information and communications technologies.
— No good options: The new campaign, led by the Telecommunications Industry Association, argues that the available choices for U.S.-made telecom equipment are insufficient to meet the law’s goal of building new, affordable broadband networks in underserved or hard-to-reach regions.
“Americans without access to broadband cannot wait for a domestic supply chain to be developed out of whole cloth,” reads a letter sent this morning from the industry coalition to Commerce Secretary Raimondo, Transportation Secretary Pete Buttigieg and Agriculture Secretary Tom Vilsack. The lobbyists say a limited opt-out provision for “Buy American” requirements would be similar to previous waivers the telecom industry received as part of the 2009 American Recovery and Reinvestment Act.
Correction: Friday’s MT misstated the name of Bret Schafer’s organization. Schafer is the head of the information manipulation team at the German Marshall Fund’s Alliance for Securing Democracy.
Jasmine Williams is now strategic outreach and visits manager for government affairs and public policy at Google. She most recently was a policy adviser at the National Security Council. … David Vennett is joining Pagaya Technologies as chief of staff to the CEO/co-founder. He currently is principal adviser to the U.N. secretary-general. … Aaron Zelinger is now chief of staff and public policy lead at Arena AI. He most recently co-led government deployments at Palantir Technologies and served as a visiting research associate with the office of Condoleezza Rice. … Rachel Bisi Lawlor is now senior manager for public policy at Amazon, where she engages with state attorneys general. She most recently was associate attorney in the state attorneys general practice at Cozen O’Connor. … Jorge Elguera has been named executive vice president and chief information officer at nonprofit Research Triangle Institute International.
About those subsidies: The chip industry just posted its highest-ever sales — and it’s poised to double them in less than a decade, The Wall Street Journal reports.
Put some AI on it: Foreign Policy argues the tech industry’s persistent diversity problem can be solved with its favorite fix for everything — artificial intelligence.
But they taste so good: Those cookie banners that were supposed to usher in a new era of online privacy? Turns out they’re a less-than-healthy choice, according to The New York Times.
First in MT: A coalition of more than two dozen progressive groups, led by Demand Progress, is urging Schumer to schedule a Senate floor vote on the American Innovation and Choice Online Act. The bill, which bans “self-preferencing” by major tech firms, passed out of committee this month.
Spotify tries to staunch the bleeding: The popular streaming platform Spotify published its moderation policies for the first time this week — part of an effort to mollify singers and podcasters angry over the company’s continued hosting of Joe Rogan, a podcaster accused of spreading misinformation about Covid-19.
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