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Your Guide to What Trump’s Second Season Means Washington, Business and World
The author is the director of public policy for Y Combinator.
For a tough speech on big technology, the Trump administration is weighing trade agreements that effectively halt the enforcement of new European laws designed to reduce the power of monopolies. If confirmed, this move will send you the exact wrong message. Washington is willing to undermine groundbreaking professional competition laws overseas to register powerful businesses at home.
At its heart, Europe’s new Digital Markets Act (DMA) imposes common sense rules on dominant platforms. Don’t unfairly like your own services. It allows for interoperability with smaller rivals and removes artificial barriers to competition.
Without similar US laws, DMA has become the world’s most powerful tool for checking exclusive self-dealing by high-tech gatekeepers. The EU has already begun to implement it, and this spring began slamming Apple and Meta with heavy fines.
Our negotiators are now breaking down the DMA to carve out the exemptions for American businesses and stopping the bounty of that competition as they start to feel. This is a myopia approach and risks overturning the Trump administration’s own pro startups, professional competition, and the agenda of pro-ai.
Only established tech giants have what they get from timeouts on transatlantic DMA. The American people and our emerging economy do not benefit. The struggle between Apple and Google shows why they welcome the reprieve. Apple’s Siri remains embarrassingly primitive. Apple has refused to open the iOS operating system to external innovation, and reportedly it is a few years ahead of its voice assistant’s true AI overhaul. Meanwhile, Google fumbled its first attempt with Generating AI. These tech giants don’t want a level playing field. They rely on Washington to protect the status quo.
The victims of the DMA suspension are America’s most innovative startups, particularly AI startups. DMA Interoperability and Fairness Rules are designed to open closed platforms and give small businesses a fighting chance. Without these rules, new AI-powered apps or search tools that can be blocked from iPhone or embedded in Google results are as good as dead.
This is not just a bad optic. It is clearly contradictory to President Donald Trump’s own agenda. His powerful appointment to the Department of Justice and the Federal Trade Commission is touted as evidence that he defends so-called “small technology” and American innovation by continuing antitrust laws against Google and Apple. Why cover Europe’s parallel efforts to hold back the same gatekeeper? The outcome of a US antitrust lawsuit requires years of litigation and appeal. The European DMA is already in operation.
Big high-tech blokes portray DMA as anti-American. In reality, the goals of the DMA are consistent with America’s ideals of fair competition. This is not Europe or America. It’s an open market and a closed market.
Vice-President JD Vance clearly understands this nuance. On a trip to Paris earlier this year, he criticized the wide range of EU technical regulations that said he would curb innovation but would omit DMA. Even solid advocates of US technical interests like Vance seem to recognize that cracking down on gatekeeping is not the same as over-regulating new technologies. The Trump administration needs to continue his example: pushing back the burdensome rules, but maintaining a neutral view on EU competitive measures like the DMA.
Once the White House sets a trade stance, it will need to move the DMA away from the negotiation table. Trump was right to oppose Canada’s now abandoned 3% digital services tax. This is a complete blow to US revenues that didn’t open new markets. However, trade negotiators should leave European DMA alone. It may be European law, but it helps level the playing field for our consumers and innovators. Trump has the opportunity to align his administration’s actions with that rhetoric. They stand up to fair markets and ensure that European competition laws run their courses. It will reaffirm that the American Edge comes from innovation rather than curbing yesterday’s tech monopoly.
