US is falling behind in global digital leadership, report says

The United States has lost its global leadership position in digital policy amid growing political polarization over policies that hinder domestic innovation and economic growth, according to a new report. 

The Information Technology and Innovation Foundation published a report on Monday titled "Restoring U.S. Leadership on Digital Policy" that features a 15-point plan to reassert the nation's digital dominance on the world stage. 

The plan includes specific measures for the federal government to maintain U.S. competitiveness, like tasking the State Department with leading a global campaign to promote U.S. tech policy over that of China or the EU. It also calls on the U.S. Trade Representative to push for more countries to sign onto the World Trade Organization’s Information Technology Agreement, which aims to reduce barriers to and tariffs on a vast range of information technology products. 

Ashley Johnson, a senior policy analyst at ITIF and author of the new report, told Nextgov/FCW that "the global digital policy scene has lately been marked by European overregulation and overreach — which disproportionately targets American firms with costly regulation and fines; a rise in digital protectionist policies; and an increase in digital authoritarianism from China and Russia."

"These trends pose a threat to U.S. competitiveness and economic growth, and the government has so far failed to adequately respond to this threat," she added.  

The report says that growing partisanship and a lack of interest in promoting U.S. digital policy across multiple White House administrations and within Congress have contributed to the country's overall decline in global dominance in recent years, allowing for allies like the EU and foreign adversaries like China to fill a digital power vacuum. 

According to ITIF, "a new, populist approach to antirust" at the Federal Trade Commission has "blocked progress on digital policy" by targeting Big Tech companies like Apple, Amazon, Meta and Google, while Congress has "dropped the ball" on spectrum policy in recent years. 

The White House has also hindered U.S. competitiveness under multiple presidencies, the report notes, including former President Donald Trump's decision to withdraw from the Trans-Pacific Partnership, a trade agreement that would have helped to protect global data flows among 12 trans-Pacific countries. 

The report also says President Joe Biden's efforts to promote global data privacy and fair economic competition through the Declaration for the Future of the Internet could eventually become a burdensome and over-regulated initiative. 

Additional recommendations include establishing U.S.-led forums for multi-stakeholder participation in digital policy issues, expanding the International Trade Administration Digital Attaché Program and reprioritizing a pro-innovation approach to regulating digital policy issues in Congress. 

"Digital policy that reflects American values of democracy and innovation benefits consumers, businesses, as well as the U.S. and global economy," Johnson said. "American leadership in this space isn’t just beneficial for the United States; it’s beneficial for the world.”