Cyber Scene - The House, United, Even on TikTok
By krahal
The U.S. House of Representatives has been very busy lately, and the Senate and White House are keeping unusual working hours as well. Tempus fugit, and so also may TikTok though in a different direction.
First, the best news: after 6 months of scavenging, the House, Senate and White House have, as of early morning on Saturday, 23 March, delivered and signed the $1.2 trillion spending package, as reported by New York Times (NYT's) Aishvarya Kavi. The eventual House vote, which threatened the position of Speaker Mike Johnson, was 286-134, finalized late on Friday 22 March and sent to the Senate. The Senate in turn rounded up 98 of 100 lawmakers for a 74-24 midnight vote. They sent it to the White House at 2 a.m. with a proviso from the Office of Management and Budget (OMB) clearing the bill by the "ceasing of shutdown preparations." President Biden signed it early in the morning.
2024 funding for cyber is perplexing and discussions of allocations to individual agencies or inter-agencies challenging. The cyber infrastructure allocation alone is large: $3 billion for Cybersecurity and Infrastructure Security Agency (CISA) and, over four years, more with some going to the Cyber Response and Recovery Fund; this reaches across federal and local IT networks as well. The IT and cyber together are looking at $74B for 2024 and slightly more for 2025.
As we move to the 2025 budget, beginning on 1 Oct. 2024, C4ISR's Colin Demarest has looked into the Department of Defense's requests and sees $14.5B for "cyberspace endeavors, including safeguarding information networks with zero trust initiatives, increasing manpower and researching advanced computing." This is $1B more than what the White House had asked for, and more than requested for 2023 which asked for $11.2B. The Pentagon has divided its cyber budget request into "…investments in three portfolios covering cybersecurity, cyberspace operations and cyber research and development." They go on to note that since 2015, there have been 12,000 "so-called cyber incidents" but declining since 2017, according to a Government Accountability Office (GAO) report. This report also cited defense contractors who are victims of infiltrations as their intellectual property is a big target for foreign hackers. This budget request would allocate around $977M for zero-trust transition, and $300M for modernized Identity, Credential, and Access Management (ICAM). The bottom line for these allocations is, as reported by Colin Demarest, that "The cybersecurity budget request improves our cyber posture by funding the development and modernization in cybersecurity tools and capabilities…and zero-trust technology…to fully secure and protect its assets."
The House has also taken on TikTok. On 13 March, the House voted 352 to 65 (with one voting "present") "…showing broad bipartisan support for cracking down on the app," as reported by Wall Street Journal's Natalie Andrew and Kristina Peterson. There are two sides to this ban: one is the concern about the extraction of US information by China via ByteDance's TikTok; on the other hand, it is the possible removal of the popular, young person's TikTok—in a sense, national security issues vs. freedom of speech. The objective is to force ByteDance to be either banned or sold.
Representative Mike Gallagher (R-WI), a familiar cyber leader in the House, explained: "TikTok cannot continue to operate in the United States under its current ownership structure." He has served as the Chair of the House Select Committee on the Chinese Communist Party and wrote the bill with the White House and Representative Raja Krishnamoorthi (D-IL). Rep. Gallagher has announced his departure from the House, effective 19 April. Since 2017, he has been a familiar lawmaker-in-charge of complex cyber issues over his four terms and an individual who has worked across the aisle with energy and knowledge.
While Senate Majority Leader Chuck Schumer (D-NY) is still conferring with his committee chairs on TikTok, President Biden has said he would sign the bill once it is on his desk and hoped that the Senate would "take swift action." Capitol Hill has already removed any governmental use of TikTok across the country, considering "the potential national-security threat and the app's impact on children," according to Senate aides. According to the Wall Street Journal (WSJ), TikTok has executed a huge lobbying effort--$21.3 million since 2019—in Washington and "… accessed more than 170 million Americans and has fended off past efforts to rein in the app."
TikTok was "blindsided," despite its efforts, by the House speed of legislation, according to Stu Woo, Georgia Wells, and Raffaele Huang at WSJ. In late February, TikTok's U.S. operations team flew to its Asian HQ to announce that the battles with the U.S. were not leading to banning for several reasons, including that President Biden's election campaign had joined the TikTok app on Super Bowl Sunday. They were aware that a low-key legislation to ban was being worked quietly, but they were dismissive of it. They discovered their mistake upon returning to the U.S.
Moreover, U.S. House lawmakers were cleared to attend a classified briefing from intelligence officials underscoring the misuse TikTok could potentially adapt with the data it collects. The bill quietly left the House committee with a 50-0 vote and has since passed the House very quickly, as noted above. This vote may also reflect the influence of a bipartisan alliance of China hawks.
As Rep. Askley Hinson (R-IA) noted, she felt that TikTok had, in a way, dug its own grave. It sent out a popup notice to the phones of some (largely young) TikTok users to contact their representatives regarding the possible ban. Rep. Hinson said: "TikTok's gross stunt proved our point. What if on Election Day TikTok sent out an alert saying, 'Our elections were canceled, we must act now.'"?
The Senate has not yet brought this to a vote. However, Sens. Mark Warner (D-VA) and Marco Rubio (R-FL), the chair and ranking member on the Senate Select Committee on Intelligence (SSCI), consider TikTok as "a platform with enormous power to influence and divide Americans." It is likely that the Senate will move forward shortly; President Biden has his pen in hand.
The Economist of 16 March goes a few steps further, regarding which company might buy TikTok if it is compelled to shut down or be sold (the latter being more likely) over the next 6-months. It starts at the top with ByteDance trying to project White House plans. While Biden said he will sign, the Economist notes that Mr. Trump almost did and changed his mind as he felt that if TikTok were sold to Meta, which is identified as a real possibility, it would make it too powerful. It goes on to note that there might be a court challenge, or several, if the Senate approves. The article also analyzes who else might win in a sale of TikTok—likely 12 figures—and Meta seems to be a top runner. Amazon, Apple, Netflix and Microsoft are also options. Time will tell.
In a podcast interview by Washington Post Live's Leigh Ann Caldwell with Sen. Mark Warner (D-VA) and Sen. Todd Young (R-IN) we return not only to their view on TikTok, but a "Futurist Summit: The New Age of Tech: Governing a New Era of Tech." The first round of questions to Sen. Warner opened with a one about declassification for the 170M individuals who have little understanding of why TikTok is so dangerous. Sen. Warner thought that some U.S. items may be declassifiable. However, some information can come from foreign partners, which prohibits further sharing. As for other countries dealing with ByteDance, he cited Canada, the UK, the Europeans, Australia, New Zealand, and others who have already banned TikTok, and India banning for consumer issues. While their outcome is similar, what led to these individual decisions is different, protected, and not declassifiable. A major distinction he cited regarding China is that "…every Chinese company has to be, first and foremost, loyal to the communist party, not to shareholders or to customers." He added that the heavy-handed kind of lobbying tactics (the Chinese used) "…I think actually in the House, (it) blew up in their face. And that's why (there were) 352 votes in favor of the bill."
Sen. Young addressed the question of whether China is ahead of the U.S. or not. He said he believes we are ahead, but has introduced legislation to establish, with Sen. Michael Bennet (D-CO), Sen. Warner and others, a Commerce Department-located office to devote to commercial research of this kind. It would be analogous to the Commerce Department's Office of Net Assessment.
They moved on to discussions of AI, chips legislation, and semiconductor supply chains with Sen. Young discussing the importance of de-risking the U.S. semiconductor supply chain, and applauded U.S. Secretary of Commerce Gina Raimondo for her excellent leadership, as she has been very careful about making targeted investments and driving tough bargains with her counterparts.
From another voice not usually included in Cyber Scene, Bloomberg addresses the unstoppable rise of AI regardless of what government leaders do. Alan Crawford's "Balance of Power" series looks at global politics. He notes that Taiwan Semiconductor Manufacturing Co. (TSMC) is expanding at its home and at its U.S. home. He continues: "…shares are powering ahead on the back of this world-leading chipmaker's statement that AI will be the key driver of growth this year." TSMC is now in Arizona, Japan, Germany, as well as Taiwan. Mr. Crawford continues, looking at Apple talking with Google to license its Gemini AI engine, perhaps to power IPhones. The confluence may raise a question about whatever kind of partnership "…between two Silicon Valley giants would be likely to draw even more antitrust focus." Yes, and it already doing so.
Wired's Morgan Meaker writes that Apple is likely to be the European's new tech law candidate, or rather its first target. EU's Digital Markets Act (DMA) intends to hold the biggest tech companies to new standards. They consider Apple as "low-hanging fruit." The leading issues seem to be restrictions on its app makers who rely on App Store to reach customers. The U.S. Supreme Court declined to take the case, apparently with Epic Games (Fortnite) charging Apple. Now Epic Games is planning to launch a rival to the Apple App Store. Apple is the first likely noncompliance DMA target, per Germany's Andreas Schwab. EU will be holding the first court with Apple under the DMA, whose rules also prevail upon not only Apple, but Alphabet, Meta, Amazon, Microsoft, and Byte Dance.
Certainly, there is more to come.
To see previous articles, please visit the Cyber Scene Archive.