‘Loser country’: Republicans target Australia over news bargaining, tech regulation

Washington: Veteran Republican political activist Grover Norquist says the Australian government’s News Bargaining Incentive is a “big deal” for the Trump administration and Canberra should expect to be hit with a trade investigation and potential penalties shortly.

Norquist, who founded Americans for Tax Reform in 1985, also took aim at Australia’s local content quota for streaming giants such as Netflix, saying it was the policy of “loser countries” that have to compel media companies to cover their cultural stories.

Republicans in Congress are now joining calls to take action against Australia, including congressman Scott Fitzgerald of Wisconsin, who introduced legislation to shield US tech companies from foreign regulations.

“The United States will not sit idly by while foreign regulators impose excessive, discriminatory fines on American companies,” he told this masthead. “Any extraterritorial policy that singles out American tech companies will be met with a strong US response.”

Legislation for the News Bargaining Incentive was introduced last week. While it does not explicitly target US companies, it applies to platforms with a significant presence in Australia, most of which are American – such as Meta, Google and Microsoft.

The policy applies a 2.5 per cent tax on the companies’ local advertising revenue – to be used to pay for news journalism – unless they strike deals with local media owners.

“This is a rerun of what the Europeans have done: targeting American companies with taxes in violation of our trade agreements,” Norquist said in an interview.

“They’re treating American companies that are successful as if they were a piggy bank that can just be robbed.”

He compared it to Britain trying to tax the colonies in the 1700s, leading to the American Revolution.

“This is a tax on American companies by a foreign power. We’re probably not going to start shooting at you, but that’s what we did with the British.”

The policy has already attracted the ire of the Trump administration. The White House has labelled it “foreign extortion”, and US trade representative Jamieson Greer raised it with Trade Minister Don Farrell on a call nearly two weeks ago.

Norquist said concern about the policy went “very high” in the US government, and he expected a Section 301 trade investigation – a precursor to tariffs or other penalties on Australia – to be opened shortly.

“It’s my understanding that that’s the obvious thing that happens next,” he said. “Exactly what Europe did to screw the United States, Australia is trying to do. And I thought we had a better relationship with Australia and New Zealand than we did with Europe.”

Trump announced a Section 301 trade investigation into Europe’s Digital Markets Act in July, but so far, it has not been initiated. The White House and the Office of the US Trade Representative didn’t respond to inquiries.