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Magaziner successor ready to work and wonk

David Beier says he will do most of his work behind the scenes, developing Net and e-commerce policies that will make his bosses popular--not him.

As the White House senior e-commerce adviser, Ira Magaziner was a familiar face at high-tech industry events, and often seemed less like a policy wonk and more like an ambassador of goodwill.

Magaziner's successor, David Beier, on the other hand, will do most of his work behind the scenes, developing Net and e-commerce policies that will make his bosses popular--not him.

Most recently, Beier was Vice President Al Gore's principal domestic policy adviser, and prior to that was a lobbyist for Genentech after a stint as counsel to the House Judiciary Committee. He now steps into Magaziner's shoes as chairman of a federal interagency task force on Internet commerce, a position Magaziner created while he was a senior adviser to the president, before leaving the post earlier this month.

An old friend of Clinton's, Magaziner had the ear of the president when it came to issues such as Net taxation, online privacy, and the transfer of the Net's addressing system from U.S. government control to an international nonprofit entity.

Observers say Beier may not have that same inside track--at least with this president. But Beier already has been working on Internet issues inside the White House, and no doubt will stay close to Gore, the Democratic front-runner for the presidency in 2000, who has been courting Silicon Valley since 1992.

Although Beier comes across as reluctant to divert the high-tech limelight away from his chief commanders, he took some time to discuss the e-commerce task force's goals as he prepares to lead this sexy--yet highly complex--area of global policy development.

CNET What do you bring to this position?
BEIER: I have a fair amount of background in a variety of policy fields, with a healthy exposure to the Congress and the policy-making process there. I bring the perspective of the private sector and background in both policy and implementation.

What the industry liked about Magaziner was that he was very visible and did a lot of public speaking. Is that how your role is shaping up--are you going to be the face of e-commerce for the Clinton administration?
I hope the face for e-commerce is the president and vice president. They were elected to represent the American people. The fact that e-commerce is a sufficiently important topic for the president and vice president to do a public event this year and to have specific directions to a multitude of federal agencies is an indication of the commitment to the New Economy. To the extent that there is a public face, it would be theirs.

Will your focus be different from Magaziner's?
The process from the very beginning was one of the president assigning to the vice president the task of putting together an e-commerce working group, which was always chaired jointly between Ira and whoever occupied the position I currently have. I don't view it as a big change.

The difference that is clear is the assignments the president laid out in the report that was issued three weeks ago. Namely, there was a whole series of new challenges [in the report]: First, there is the Internet Tax Freedom Act commission, and associated international tax issues is one constellation of issues. Second is the broader availability of broadband for residences and small businesses. Third is expanding the availability of e-commerce opportunities in the developing world. Then fourth is expanding and working on consumer protection measures for electronic commerce.

One major task left unresolved with Magaziner's departure is the ongoing international debate over online privacy protections for consumers. What is the administration's policy plan in this arena for next year?
[We'll] continue to look at the viability of self-regulatory mechanisms. I'm extremely hopeful that [the federal privacy liaison] will be appointed in the month of January. We've been working on it.

President Clinton signed the Children's Online Privacy Protection Act, which basically establishes that it's economically feasible for Net companies to get parental permission before collecting personal data from children under age 12, and to give parents access to their children's records. Should adults be given the same control of their own data?
I think there are valid distinctions to be made between protecting children and empowering parents. Adults are in a position to protect themselves and make informed choices. The challenge is, what kind of effective combination of existing laws and meaningful self-regulation can you create on the adult side? If you look at where the 100 leading Web sites are--I think 40 percent are members of TRUSTe or have some posted privacy policy--that is good, and a significant change from a year ago, but it's not sufficiently comprehensive to meet a test of coverage. And one question is how quickly is that going to change and how meaningful is the enforcement mechanism?

Still, some of the self-regulatory regimes have fallen short--for example GeoCities became a member of TRUSTe while it was under scrutiny from the Federal Trade Commission for its data-collection practices. With that in mind do you think there needs to be more leaning toward regulation vs. pushing voluntary industry principles?
We've taken the view that there are many existing laws, regulations, and enforcement opportunities for people who misrepresent their policies. That is a platform on which you can add [a] self-regulatory regime. The question is whether there has been enough time and energy devoted to these self-regulatory mechanisms, and at what point it will be perceived by consumers and the government as not being adequate--but I don't think we are there yet.

But the European Union has continued to question the effectiveness of the administration's stance that industry self-regulation is more effective than strong laws to protect the security of sensitive personal information in the digital age and give people access to their records. Do you think the European Union will accept the U.S. position as adequate compliance with its strict data privacy directive that went into effect in October?
It's not a good idea to comment in the middle of negotiations.

Another data privacy issue the administration is still grappling over is its encryption policy. Magaziner wasn't a big fan of the U.S. controls on the export of strong encryption, which businesses say cripples their ability to compete with foreign manufacturers of the data scrambling technology. Where do you stand?
I would hope that I would support the administration's policy because I work for the administration. The vice president has consistently said to Sen. Tom Daschle (D-South Dakota), in letters, that the goal of continually working on this in a regulatory context is keeping [law enforcement and businesses] in as much harmony as possible. What we've seen over the last year is a big improvement in terms of the level of understanding of these communities about the valid concerns of the others. We have a much different, more cooperative spirit now. It's going to be an issue every year.

There is a perception that the administration is pushing stronger crypto controls abroad than at home. For example, 33 nations signed the Wassenaar Agreement to impose controls on the most powerful data-scrambling technologies, but then decided to end an exemption for software already available on the mass market. Is David Aaron, the U.S. special envoy for cryptography, pushing export limits on strong encryption elsewhere, while the administration trumps its ongoing concessions for U.S. companies?
In our view, the position David took was consistent.

I think at this point the obligation we undertook with the private sector was to get some regulations out this month. The next step is to try and evaluate where the technology is and the impact of recent international agreements on encryption, such as [the Wassenaar Agreement]. It's a topic that requires frequent attention as the technology changes. The overall goal, however, is maintaining focus both on the commercial implications and being cognitive of national security issues and law enforcement issues. Those three legs of the stool will continue to be part of the discussion.

As you mentioned, Congress just passed the Internet Tax Freedom Act, a three-year ban on discriminatory Net taxes, and the World Trade Organization adopted a one-year ban on Net tariffs. Both moves are seen as a boon for e-commerce. What is next?
The [Net tax policy] commission has to be put together. We hope that a consensus will emerge out of that process that can permit the dual goals to be met: the goal of a flourishing e-commerce sector in the United States and sensitivity to the fiscal realities of state and local governments. There is a system in place with that commission of requiring 13 out of 19 votes to approve anything--that is a daunting task. It's too early to determine an outcome.

Clinton signed the Child Online Protection Act as part of a major spending bill, making it a crime for commercial Web sites to give minors access to harmful material. This law is now being constitutionally challenged in federal court. This is the same thing that happened with a controversial part of the Communications Decency Act. Are we going to see any proactive policy decisions by the administration in 1999 to avoid this situation in the future?
The Justice Department is obligated to defend laws that have been signed by the president--and that is not going to change.

The content issue in 1999 is more likely to be on the question of [Net] filtering activities in schools and libraries. The administration has taken a fairly consistent view, along the lines of something proposed by Sen. Conrad Burns (R-Montana), that [says] states and local governments are the best place to determine what is appropriate for a community. The local school district, for example, should have their own plan to protect students from indecent materials. That may mean filtering software or requirements of parental consent before access is provided. In a one-room schoolhouse it could be the teacher looking over the shoulder of the student. Sen. Burns' legislation really says that it is a local decision, not a one-size fits all [mandatory federal filtering requirement].

Arguably, there will continue to be policy questions surrounding content, such as attempts by some nations to put language requirements on Net communication, and attempts by the Congress to deal with content in terms of limiting gaming or indecent material.

With all these policy goals ahead, is there a concern that the president's impeachment crisis is hindering the effectiveness of the administration?
No. The president and vice president are very focused on doing the work of the American people and that is what they spend their time worrying about.