At Risk: Three Things The Tech Industry Loves That Trump Is Likely To Kill

Following this November’s U.S. presidential election, many parents found themselves having to tell anxious children what a Trump administration would mean. If you have a friend or loved one who works in technology, it wouldn’t hurt to have a version of this talk with them, too.

That’s because a Trump presidency is likely to usher in some substantial changes that will impact the tech industry. He won in spite of being famously short on campaign details, but the major themes of his campaign – e.g. restricted immigration, rebuilding infrastructure, increased military spending, across-the-board tax cuts – suggest that some tech-friendly policies, including some that pre-dated Barack Obama, are endangered.

Here are three that come to mind:

The End of Electric Vehicle Tax Credits

A new Tesla starts at about $66,000 and can cost as much as $135,500. To encourage adoption, the Federal Government offers buyers in all states a $7,500 income tax credit. Many states offer additional tax credits; Louisiana’s tops the list with a maximum of $9,500.

Think about who benefits from these tax credits. The kind of person who can afford a $66,000 vehicle ($58,500 after the federal income tax credit) is almost certainly in the highest income tax brackets. Giving these folks a generous tax credit is one of the most regressive policies in existence. Tesla’s cause – solving global warming – blinds many to this, but in Trump’s environment of shrinking federal tax revenues, it makes even less sense to give back to some of the richest people. I suspect Tesla’s sales wouldn’t change significantly were the subsidy to disappear; its consumers don’t buy Teslas for the tax advantages. If you accept that, it tells you all you need to know about why this tax policy is at risk.

Opening the “Back Door” to Phone Encryption

Trump campaigned as a law and order candidate. If the FBI’s incoming director tells a President Trump that s/he needs to access an encrypted smartphone to gather evidence, I can’t see Trump standing in the way. In fact, I envision Trump using the bully pulpit to pressure Apple, Google and others to grant law enforcement a “back door” to phones that have been seized as a part of a legal investigation.

Apple has carved out a very adamant position in defense of encryption. CEO Tim Cook wouldn’t acquiesce to these demands without a fight. On the other hand, if Apple senses that resistance could cause its business real harm, for example if the government were to levy large fines for non-compliance, the company likely would have a change of heart. After all, Apple already has accommodated the Chinese government in ways that are hostile to privacy.

So Long, Net Neutrality

I don’t think Trump cares much about this issue, but many in his party do. Whomever he nominates to replace Tom Wheeler as head of the FCC is likely to bring his or her own agenda. This will include a desire to overturn the FCC’s classification of the internet as a utility under the 1934 Communications Act.

I’ve written about net neutrality before, so I won’t rehash my arguments about why I think it’s a solution in search of a problem. I’ve talked with Wheeler’s supporters about this and learned that even the most ardent among them struggle to identify a current problem that this regulatory classification solves. Instead, they see net neutrality as preserving the open internet we’ve had for decades while heading off future problems. While I admire their spirit, more government regulation of what has been the backbone of so much innovation strikes me as a bad thing. I won’t miss it when it’s gone.

What other likely changes am I missing? Add them to the comments section below.

The featured image of Donald Trump used in this blog can be found on candidate Trump’s website.

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