Will the US economy lose competitiveness over the NSA revelations?

Enrique Dans
Enrique Dans
Published in
3 min readJul 15, 2013

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One outcome of the NSA scandal is that an important section of US public opinion is beginning to see in the future a hypothetical loss of the country’s economic competitiveness, and particularly in California.

John Dvorak’s “The NSA’s surveillance will devastate commerce” or Joe Matthews’ “Who got hurt by this NSA scandal? California” exemplify the concerns that US companies could fall out of favor with some overseas users who make up a major part of their business due to the caution that those clients will likely manifest now that they are aware of mass spying and a dysfunctional legal system that permits it.

If Edward Snowden’s leaks show anything, it is that nobody is immune from this kind of spying. Everything seems to indicate that the relaxing of practices carried out systematically and on a mass scale have led the NSA Special Source Operations Division to enjoy absolute impunity when it comes to accessing US citizens and residents’ data, a procedure that, in theory, requires a judicial order.

The changes to the law that have allowed these excesses are in clear breach of the US Constitution, to the extent that 71 percent of US voters believe that the country’s founding fathers would be dissapointed with the way the United States has turned out.

But in the case of foreign citizens, the lack of protection generated by the FISA (Foreign Intelligence Surveillance Act) is total and absolute: a user, whether an individual or corporate, of a service offered by a company based in the United States has to accept that his or her data is at the disposal of US intelligence at any time, in the hands of an administration that we now know has no qualms about using us not only as a pretext for national security, but also for reasons linked to the competitiveness and trade objectives of its companies.

Why would any foreign company use US services in the knowledge that it will likely find itself exposed to state espionage that will sabotage any potential growth strategy? The latest revelations show that not only can we no longer enjoy peace of mind while using Microsoft products or when chatting via Skype, now it turns out that HP can’t be trusted either, and nor can any of the other companies that Ed Snowden has mentioned in his leaks.

But the issue goes far deeper: the US administration has armed itself with every means to oblige technology companies to collaborate in its spying activities. And, logically, there have been protests, and over time they will spread, until they become recommendations, directives, and possibly boycotts. The basic principles of security that corporations have come to expect can no longer be relied on. And for many individuals, the temptation to change to another provider for many services, or at least to protect oneself begins to look increasingly justified.

At the end of the day, this is the logical outcome of an absurd, disproportionate and dysfunctional regime. So from now on, when choosing a new product or service, or each time you use something that you already own, ask yourself where the company that supplied it is based. If the answer is the United States, then your information, quite simply, is not in good hands.

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Enrique Dans
Enrique Dans

Professor of Innovation at IE Business School and blogger (in English here and in Spanish at enriquedans.com)