Before policymakers regulate AI, they need to understand a fundamental technology: neural networks.
Congress needs to act on child care challenges
The video game industry is concentrated in a handful of locations, leaving incredible talent in underserved areas frequently overlooked. Ben Kvalo started Midwest Games to change that narrative, supporting underrepresented game developers because increasing diversity in game development leads to better products and bigger markets. Ben recently joined us to talk about Midwest Games, the challenges of raising capital in the Midwest, the importance of small developers in maintaining a healthy video game ecosystem, and the potential benefits of AI for the industry.
Engine statement on SCOTUS Decision in Moody v. NetChoice and NetChoice v. Paxton
Consumer weather models are too coarse for farms and conservancies that are large enough to occupy their own microclimates. Dr. Carlos Gaitan started Benchmark Labs to solve this problem, leveraging artificial intelligence to create custom weather models for farmers and conservators—helping them increase their crop yield and better manage their land. Carlos recently sat down with us to discuss Benchmark Labs, his experience as an immigrant founder, the value of government funding for startups, and how policymakers should approach AI policy.
The Big Story: Congress hears about startups’ need for clear data rules. Lawmakers have turned back to discussions of a federal privacy framework, including at a hearing this week on data security, which featured testimony from Engine focused on how startups need clarity and certainty around data security practices.
The Big Story: SHOP SAFE bill advances despite potential to harm e-commerce startups and small businesses. In a first vote this week, the House Judiciary Committee advanced the SHOP SAFE Act, a bill that would create substantial costs and risks for e-commerce startups—making it harder for them to compete—and erect new barriers for entrepreneurs and small businesses who want to sell goods online.
The Big Story: Congress hits roadblock on immigration reform
A potential pathway to citizenship for Dreamers—a group critical to the startup ecosystem—was derailed this week when the Senate Parliamentarian blocked Democrats’ efforts to include immigration reform in the $3.5 trillion reconciliation bill. Many Dreamers are entrepreneurs, and, as a group, they employ over 86,000 individuals across the country. Legislators are now considering alternative proposals to ensure immigration provisions remain a priority.
The Big Story: Recognizing the contributions of immigrant entrepreneurs. Throughout the month of June, we celebrate Immigrant Heritage Month and recognize the impact of the immigrant community in the U. S., including on the country’s startup ecosystem. As the nation reflects on the significant contributions of this community as a whole, it is important to acknowledge and uplift the stories of immigrant entrepreneurs and recognize the challenges these founders face.
The Big Story: Lawmakers consider SHOP SAFE Act despite outsized impact on e-commerce startups. This week, lawmakers examined the recently reintroduced SHOP SAFE Act, which would place high compliance burdens on e-commerce startups with the goal of deterring trademark infringement. The bill was the subject of yesterday’s hearing held by the House Judiciary’s Subcommittee on Courts, Intellectual Property, and the Internet.
The Big Story: Spotlight back on content moderation as Facebook upholds Trump ban. Internet companies' content moderation decisions are back in the spotlight this week as Facebook’s oversight board—a panel of journalists, activists, and lawyers that reviews the company’s content decisions—announced that former President Donald Trump should remain suspended from the platform, prompting criticism and threats of legislation from Republicans in Congress. Facebook banned Trump in January after the insurrection attempt on January 6th, citing the ongoing risk of political violence. The board also said that Facebook was wrong to impose an indefinite ban and called for the company to decide in the next six months whether to restore Trump’s account, permanently remove him from the platform, or suspend him for a specific timeframe.
TLDR: A key House panel is holding a hearing this Thursday with the CEOs of Facebook, Google, and Twitter to examine the spread of extremism and misinformation online. It’s critical that policymakers concerned about the proliferation of harmful content across the Internet understand how potential legislative remedies would impact startups and other Internet companies’ ability to moderate user-generated content.
TLDR: Across the country, state legislators are pushing bills that would make it harder for Internet companies to moderate content on their sites and services. In addition to raising constitutional and legal problems, the state-level push to limit moderation would disproportionately harm small and emerging companies that are attempting to compete in the Internet ecosystem.
The Big Story: States pushing social media laws based on unfounded bias claims. Republican state policymakers across the country are pushing for laws that would stop social media companies from engaging in content moderation, amplifying GOP politicians’ long-standing complaints about anti-conservative bias, which were refuted in a recent report. But while Republicans have directed their ire at large Internet companies and Section 230—a bedrock Internet law that allows companies of all sizes to host and moderate user content without being held liable for the content they moderate or for what their users post—their state-level efforts to ban moderation are legally problematic and would hurt small and new companies attempting to compete in the Internet ecosystem.
In a new Medium post, Engine announced the launch of our Startup Agenda 2021, which outlines the policy priorities of the U.S. startup community. The Startup Agenda 2021 covers a range of policy issues that include capital access, connectivity, intellectual property, privacy, and more. As we explain in our post below, there are startups in every state and congressional district across the country, and their perspective is especially critical if policymakers hope to craft rules and regulations that boost innovation and competition.
TLDR: As President Joe Biden’s transition team continues to vet and identify key federal officials, agencies that contribute to technology and small business policy—such as the Federal Communications Commission (FCC), the Federal Trade Commission (FTC), and the U.S. Patent and Trademark Office (USPTO)—will likely see new leaders in the coming months. As the Biden team picks new federal officials, however, it should be guided by a commitment to supporting and enabling the nation’s innovation ecosystem.
The Big Story: After attack on U.S. Capitol, Internet companies move to block Trump. Content moderation efforts at the world’s largest Internet companies were under the microscope this week as Facebook, Twitter, and YouTube took action against content shared by outgoing President Donald Trump that led to a violent riot at the Capitol that left five dead, including a U.S. Capitol Police officer.
This year has been difficult for every individual and company in the country. During a global pandemic, which has caused widespread economic damage and uncertainty, startups are struggling—struggling to find funding, struggling to navigate existing government relief programs, and struggling to maintain jobs and operations (let alone sustain growth). And across the country, people are looking to Washington for support and guidance.
The White House’s executive order on “preventing online censorship” is a dangerous move that will encourage bad faith lawsuits, and dismantle the fundamental and commonsense legal framework that startups depend on to compete in today’s Internet ecosystem and keep their platforms free of objectionable content.
The Eliminating Abusive and Rampant Neglect of Interactive Technologies (or EARN IT) Act from Sens. Lindsey Graham (R-S.C.) and Richard Blumenthal (D-Conn.) addresses a critical issue—stopping online child exploitation, which is a goal that startups share. But, as currently drafted, the bill threatens to unnecessarily disrupt the regulatory framework that has helped the Internet flourish and potentially ban the use of strong encryption technologies that protect user safety.
When the United States negotiates trade agreements, it has the chance to give startups a similar legal framework abroad that they rely on domestically. This is critically important for smaller companies looking to effectively compete in an increasingly global ecosystem. While Congress still has the ability to update that digital legal framework as it sees fit, the inclusion of digital trade protections in trade agreements gives startups the certainty they need to compete globally.
In this report, and through a series of events in Washington, D.C. in the summer of 2019, Engine and the Charles Koch Institute sought to unpack the nuts and bolts of content moderation. We examined what everyday content moderation looks like for Internet platforms and the legal framework that makes that moderation possible, debunked myths about content moderation, and asked attendees to put themselves in the shoes of content moderators.
Section 230 of the Communications Decency Act has been privy to the ire of politicians at both ends of the political spectrum in recent weeks. That misplaced bipartisan disdain isn’t limited to the 1996 law, however. As the USMCA approaches formal consideration in Congress, attacks on the agreement’s Article 19.17, which mirrors the language of Section 230, have ramped up as well.
In a Ways and Means Committee hearing on trade policy earlier this month, Rep. Linda Sánchez (D-Calif.) showed clear animus towards the article in a terse exchange with U.S. Trade Representative Robert Lighthizer. Running over her time, the congresswoman asked why the U.S. intermediary liability rules were included in the agreement, saying she had “significant concerns regarding the USTR’s stance on CDA 230.” Ambassador Lighthizer defended the CDA 230-like language, saying “it’s U.S. law” and that the digital trade chapter is “a way for small internet companies to grow and use their advantages.”
The Ambassador is right. Article 19.17—and the digital trade chapter of the USMCA—will lead to greater innovation domestically and among our trading partners. As Santa Clara Law School professor and leading Section 230 scholar Eric Goldman points out in a letter signed by Engine, Article 19.17 is critical to this end because it lowers barriers, strengthens markets, and advances liberty.
Immunity for content generated by third parties on their platforms allows startups can get off the ground without exposure to potentially crippling lawsuits. It facilitates consumer trust by enabling third-party reviews, a hallmark of Internet commerce that would not exist without such protections. Finally, Article 19.17 expands free speech opportunities through increased access to platforms.
Unfortunately, Rep. Sánchez isn't alone in her criticism of the liability rules. Her Republican colleagues, Reps. Paul Gosar (Ariz.) and Matt Gaetz (Fla.), also oppose Article 19.17, attacking the U.S. liability rules that have fostered the internet we know today.
The House Democrats’ nine-member working group is focused on reconciling their issues with the USMCA in four areas: drug pricing, enforcement, labor, and the environment. While it appears unlikely that agreement will come to a vote with just 12 work days left before Congress enters its six-week recess, that list of issues need not be expanded. Going forward, the USMCA doesn't need another roadblock. Especially not one that needlessly picks apart the novel and innovation-advancing digital trade chapter.
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