Will the New U.S. Trade Rep Be Hobbled by Lobbyists?

Despite the appointment of a progressive, Katherine Tai, to the top slot, Big Tech hopes to insert allies as her deputies.

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Katherine Tai has now been officially named U.S. trade representative, as the Prospect first reported on December 4. This is very good news for the progressive community.

Tai, currently the top staff trade counsel for the House Ways and Means Committee, represents a clean break with the corporate-dominated trade agenda and associated personnel. She is also fluent in Mandarin, and was the USTR’s senior person on China trade issues earlier in her career.

As U.S. industry keeps being undercut by foreign state-led capitalism, and as both parties are inclined to question monopolistic abuses by tech platform companies, the old recipe of corporate-led free-trade deals is ripe for overthrow.

Tai could represent a new era in Democratic trade policy, replacing both “free trade” scams on one flank, and the incoherent economic nationalism of Donald Trump on the other, with careful, substantive policy that serves America’s economic interest.

But the way these things work, Tai is at risk of having corporate types imposed just below her, in the key deputy USTR slots. There is a revolving door between USTR and powerful corporations, notably Big Tech companies, which have much to gain or lose from trade deals. As I’ve written, the next round of trade deals will resolve significant questions about e-commerce, privacy, the use of algorithms, and much more.

As we’ve reported, two USTR veterans now working at Amazon, David Roth and Arrow Augerot, are being promoted for top slots. Yesterday, a coalition of 20 consumer groups sent a letter directly to President-elect Biden urging him not to put tech lobbyists in USTR. The letter, signed by such groups as Jobs With Justice, the Open Markets Institute, and Public Citizen, said in part:

David Roth and Arrow Augerot have previously held roles at USTR, when top USTR priorities were the passage of trade agreements like T-TIP and TPP. The TPP included broad limits on governments’ authority to break up or regulate such firms and USTR pushed for similar terms in the TTIP. Both pacts were backed by Amazon and other tech giants and roundly opposed by advocates for labor, human rights, and the environment.

Amazon has an ongoing vested interest in shaping American trade policy so as to oblige signatory governments to guarantee various rights and privileges for Big Tech monopolies and to thwart public interest oversight by governments. Roth’s and Augerot’s recent work on behalf of Amazon should conflict them out of roles in the government agency currently [working on] negotiations in Geneva to set binding rules on the very privacy, data flow, source code secrecy and competition policy issues of direct interest to Amazon.

Amazon is the target of several investigations for its abuse of power … from the Federal Trade Commission and several state attorneys general. … Over the last 18 months, it has been the subject of an investigation by the bipartisan House Judiciary Subcommittee on Antitrust, Commercial, and Administrative Law, which found Amazon abused its power to crush competition, target and destroy small and independent businesses, and amass gatekeeping monopoly power over American e-commerce.

And it gets worse. We’ve learned that two other revolving-door trade veterans now working as corporate consultants or lobbyists are in contention for senior jobs under Tai. One is Behnaz Kibria, senior policy counsel at Google on cloud policy. She was previously deputy chief of staff at USTR under Mike Froman, the ultimate corporate Democrat to hold the top trade job.

Yet another is Danny Sepulveda, who works for MediaMath, a global internet-marketing tech company. He previously had posts at State and USTR and on Capitol Hill.

Note how diversity objectives get all tangled up with questions of ideology and conflicts of interest. Tai is Asian American. Kibria was born in Bangladesh. Sepulveda is Hispanic.

More from Robert Kuttner

Biden is doing very well on the diversity front—just like major corporations in tech. But there is more to economic life than diversity. Biden needs to do equally well on the “no corporate capture” front.

One further complication is the role of Jayme White, top staffer on trade to Sen. Ron Wyden (D-OR), the ranking Democrat on the Finance Committee. Wyden is very close to Big Tech, and White is far more in the corporate-globalist camp than Tai.

Well-placed sources tell us that there was something close to a handshake: Progressives get Tai and tech globalists get White just under her.

But this is not quite a done deal. Tai has only just been named, and the trench warfare over trade policy has already begun. Doesn’t she deserve the courtesy of choosing her own deputies?

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