By Björn Jeffery, SvD Tech Brief. Published in Svenska Dagbladet on 10 January 2025.
Silicon Valley is entering Washington DC as Trump’s new government takes office. Never before has the political influence of tech companies been so great. But not all changes in the apparatus of state will be welcomed with open arms.
When Donald Trump is sworn in as the 47th president of the United States on 20 January, he brings with him a group of formidably influential entrepreneurs and investors.
David Sacks — the investor known through the All-In podcast — is set to become the new AI and crypto tsar. Big questions for America’s future, one might think. But apparently not so big that Sacks intends to work on them full-time. He plans to continue as a venture capitalist simultaneously.
While the tech celebrities — led by Elon Musk — descend on Washington DC, they are preceded by a vast political machinery. A range of American agencies are about to change leadership and, along with it, parts of their direction and remit. It is in these less glamorous areas, away from AI and cryptocurrencies, that one finds questions which will very much affect the American tech industry and Silicon Valley in particular.
There are three areas where things could become especially fraught.
The first concerns competition issues — what is known as “antitrust” in the United States. Here, the past four years have been defined by a highly restrictive political stance on the ability of tech giants to acquire other companies. The number of acquisitions has therefore fallen dramatically. Meta, Facebook’s parent company, has not completed a single major acquisition in the past two years.
This shift has been driven by Lina Khan, Biden’s appointed chair of the Federal Trade Commission (FTC), the American competition authority. Her hard line has put pressure on Amazon and Google in a way they had never experienced before. The same tendency has been visible in the courts, with a judge ruling last year that Google holds a monopoly on the search market.
With Trump in the White House, Lina Khan will be fired immediately. Her replacement will be lawyer Andrew Ferguson, a former prosecutor from the state of Virginia. When Ferguson takes over, the FTC will be in the middle of a lengthy series of legal proceedings initiated by Khan, and it is unclear whether he will see them through. It is, however, highly likely that the FTC going forward will take a more permissive attitude towards corporate acquisitions — though it could push harder on regulating content on social media platforms.
This leads to the second area. That Meta’s Mark Zuckerberg chose this week to remove fact-checking from Facebook and Instagram is no coincidence. It was an opportunistic — and to some extent necessary — move to avoid attracting immediate problems from the incoming administration. Anything that can be perceived as censorship of any kind will have a harder time under Trump in the years ahead. Zuckerberg almost certainly made the correct calculation that it is better to get ahead of things than to be caught out. He therefore realigned Meta’s policy to something more suited to Trump. Whether it will be enough remains to be seen.
The question of content on social media is, however, highly complex — politically as well. It is not only the FTC that may have views on this, but also the agency FCC — the Federal Communications Commission. The incoming chair there, Brendan Carr, wrote ahead of the election that the law governing immunity for what is written on social media — the so-called “Section 230” — should be drastically curtailed. This would mean that social media companies could be held liable for what is said by users on their platforms. But they could also be held liable for removing too much material through moderation. That would represent a major change and a significant tightening if it came to pass.
It is not clear whether such a change falls within the FCC’s jurisdiction, and any such move could therefore be tied up in the courts for a long time. But the mere prospect of new regulation here could prompt sweeping changes at social media companies.
The third and final area concerns labour immigration. Here a rift has already opened between Silicon Valley and the broader MAGA wing of the Republican Party — even before Trump has taken office. The issue centres in particular on the H-1B visa type used by tech companies to hire talented individuals, often engineers, from other countries. Their stay in the country is tied to employment, meaning they are effectively expelled if they are unemployed for more than 60 days. For Silicon Valley firms, the visa type is considered vital for finding the right kind of workforce.
The criticism from the MAGA camp is that American jobs are going to foreign workers, meaning native-born Americans are missing out on well-paid positions.
These are three areas whose impact will be enormous for many tech companies. Ahead of an election, it is easy to unite around big pledges and joint statements projecting unity. But there are many questions where the interests of tech companies do not necessarily align with the views of the Republican majority. Having a tsar for AI issues certainly looks impressive and a little exciting — but that is not where Silicon Valley has its greatest needs.
