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Big Tech is ruining the US economy, say some activists, politicians, and pundits. And these worriers wish Washington were as assertive as Brussels in dealing with America’s monopolistic monsters. Europe has probed them, fined them, regulated them, and is now trying to tax them.
Oh, and one other thing: Europe is trying to build its own tech titans. “European Union officials have drawn up an aggressive 173-page plan to counter both President Donald Trump’s trade moves and American tech giants including Google, Apple, Amazon, Microsoft and Facebook,” Politico reports. A key element of this strategy would be a European Future Fund meant to directly invest more than $100 billion in high-potential European companies operating in “strategically important sectors.” Additionally, the Brussels bureaucrats hope all that public money would “crowd in” plenty of private-sector dough.
The document is infused with an unease that the region has lost control of its technological future to American and Chinese firms. This from the Financial Times:
The document warns that non-EU companies “with unprecedented financial means [have] the potential to obliterate the existing innovation dynamic and industrial position of EU industry in certain sectors”. It names US tech giants known as the “Gafa” (Google, Apple, Facebook and Amazon) and China’s “Bat” (Baidu, Alibaba, and Tencent) as companies who have bought out potential rivals and now “manage the global digital agenda”. “Europe has no such companies,’’ says the document. “This presents a risk to growth, jobs, and to Europe’s influence in key strategic sectors.”
“Europe has no such companies.” Indeed, the inescapable flipside here is that cooking up a Chinese-flavored industrial policy that resulted in EU-based GAFA and BAT competitors would be seen as a desirable outcome. Made In Europe: 2025. As such, this document lends a bit more credence to the notion that all those EU investigations and fines have a protectionist purpose. Remember, China’s mega-companies didn’t get that way purely by offering high value to consumers. Beijing makes it hard for American tech competitors to operate there. Amazon recently quit China, with The New York Times noting that the company “faced fewer restrictions when it entered China than foreign internet companies face today.”
Is a lack of government help really why Europe is lagging? Plenty of other explanations have been offered, including a linguistically and culturally fragmented market, and less military-driven tech research. I can’t help but wonder how much of Europe’s problems stems from its skepticism toward entrepreneurship and the churn of economic dynamism, as well as lack of appreciation for the unintended consequences of regulation, such as the EU’s recent General Data Protection Regulation (which seems to have been “a boon for Facebook and Google,” notes The Wall Street Journal). Not sure these are problems an investment fund of $100 billion or $200 billion can solve.
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