As court strikes down Trump’s tariff power, Apple faces new threat in Texas
(Originally published May 29 in “What in the World“) Are retailers responsible for the impact the products they sell have on customers?
Texas says they are. Much the same way gas stations and liquor stores must verify the age of customers buying cigarettes and alcohol, the state just passed a law requiring that Apple and Google verify the age of users downloading apps or making purchases through the companies’ on-line app stores. Texas joins Utah in requiring such age verification of online customers.
Apple had lobbied against the Texas bill, with CEO Tim Cook reportedly calling Texas governor Greg Abbott to try to convince him to veto it. Apple says the law requires it to store sensitive personal information about users of its devices. How that differs from the information Apple already stores to secure the account all device users must create to access Apple’s in-device contacts and calendars apps as well as its store for music, movies, and third-party apps is unclear.
Yet Apple supported a proposed federal law, the Kids Online Safety Act (Kosa), that would have required social media companies to design their products to reduce potential harm to minors. The U.S. Senate passed Kosa last year, but the bill stalled in the House of Representatives. With Kosa dead, states have moved to pass their own online child-protection laws.
Companies generally oppose restrictions on their sales of merchandise, typically arguing caveat emptor. When it comes to information, tech companies in particular have leaned on the three legal precedents of privacy protection, freedom of speech, or freedom of the press — even when these disagree. Thus it was that Big Tech opposed attempts to restrict its ability to vet user content, arguing that it violated companies’ First Amendment right to determine what content their platforms publish, but then opposed a separate attempt to hold them responsible for what user content they do choose to publish the way newspapers and other media can be held responsible for content deemed libelous or defamatory. In other words, Big Tech argues it should be able to select what users post and then gets pushed into others’ screens, but shouldn’t face any consequences if that information results in harm.
Big Tech ultimately won both cases when the Supreme Court declined to hear them. So Meta, Google and X get to pick and choose what information users post and others see, but face no consequences for its impact. They get to have their cake and eat it, too.
Does Donald just miss his Timmy? The New York Times seems to suggest that Trump’s latest salvo against Apple might stem from CEO Tim Cook’s failure to join the President on his magic carpet ride to the Gulf earlier this month.
In case you missed it, Trump last Friday added to Cook’s troubles by threatening to impose a 25% tariff on its imported iPhones if Cook didn’t grant Trump’s wish for more (maybe even all) iPhones sold in the U.S. to be made domestically.
Cook was conspicuous by his absence from Trump’s tour of Arab autocracies, which included Tesla CEO Elon Musk as well as a parade of other corporate sycophants from chipmakers AMD and Nvidia, industrial titans Alcoa and Boeing, tech companies Amazon, Google, IBM, OpenAI, Palantir, and Uber, as well as financial giants BlackRock and Citigroup. So, after granting Apple an exemption from his 145% tariffs on imports from China, Trump is threatening to take the favor back.
Apple may have won a reprieve Wednesday, however, when the U.S. Court of International Trade declared that Trump’s “reciprocal tariffs” are illegal. The court ruled in favor of a suit by states and companies that Trump overstepped his authority when he based his tariffs on the International Emergency Economic Powers Act of 1977. The court ruled that the U.S. trade deficit doesn’t constitute the kind of national emergency described by the Act to justify conferring authority to the president normally held by Congress. The court also ruled that the Act does not give Trump unbounded authority to impose tariffs and gave the White House 10 days to halt them.
The Justice Dept. said it plans to appeal the ruling.