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Victor Davis Hanson: U.S. high-tech industry a $3 trillion chameleon

| Saturday, Jan. 27, 2018, 12:24 p.m.

Twenty years ago, no one had heard of Facebook or Google, or knew much about social media or search engines in general. Cellphones were simply mobile, expensive telephones. There was no concept of a phone as a handheld computer.

Today, five companies — Amazon, Apple, Facebook, Microsoft and Alphabet (Google's parent company) — have a collective worth of more than $3 trillion. Yet such transnational companies remain mostly exempt from the sort of regulations and accountability faced by most other industries.

Major corporations understandably fear product liability laws. Oil companies are hectored by class-action lawsuits and headline-grabbing attorneys badgering them to pay up for supposed climate change brought on by commuters filling up each week. Tobacco companies have paid out billions of dollars due to cigarettes' contribution to lung cancer. Pharmaceutical corporations are often forced to pay millions in fines when their prescription drugs cause dangerous side effects.

Yet every year, nearly a half-million Americans are injured in traffic accidents due to distracted driving involving a cellphone. No one knows how many millions of people worldwide are addicted to the apps on their smartphones. Yet unlike Big Pharma, Big Oil and Big Tobacco, Big Tech is rarely held responsible for the deleterious effects of its products on millions.

In most states, public boards and commissions regulate companies that provide public utilities. The theory is that such corporations use public spaces to serve a captive public domain and provide an essential need. Radio and television stations are regulated by the federal government on the similar assumption that the airwaves are not private property.

Huge tech companies are also utilities of sorts that provide essential services. They depend on the free use of public airwaves.

So why are they seemingly exempt from the rules that older corporations must follow?

First, their CEOs wisely cultivate the image of hipsters. The public sees them more as aging teenagers in T-shirts, turtlenecks and flip-flops than as updated versions of J.P. Morgan, John D. Rockefeller or other robber barons of the past.

Second, the tech industry's hierarchy is politically progressive. In brilliant marketing fashion, the internet, laptops, tablets and smartphones have meshed with the hip youth culture of music, TV, movies, universities and fashion. Corporate spokesmen at companies such as Twitter and YouTube brag about their social awareness. The tech industry is seen as an ally of federal bureaucrats and regulators.

Third, the tech industry boasts that it is green and clean. Plastic cords and screens almost magically produce podcasts, videos, email, social media pages and the internet. Few in the public worry about how lithium-ion batteries are made, or how their ingredients are mined. Smartphones and laptops apparently were spontaneously generated out of the clean air of the cool San Francisco Bay area and will dissolve back into it when they wear out.

Finally, high tech is an American specialty and a huge earner of foreign exchange. Politicians are understandably afraid of turning a golden goose into a sick hen.

The result is that high tech has become a brilliant chameleon — invisible in plain sight.

Victor Davis Hanson is a classicist and historian at the Hoover Institution, Stanford University.

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