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Coastal hubs are snapping up most new, high-tech jobs. Researchers say it’s time for the federal government to make a massive investment — $100 billion over 10 years — to ensure metro areas in the heartland are keeping up.

Just five metro areas — Boston, San Diego, San Francisco, San Jose and Seattle — picked up 90 percent of the 256,063 tech jobs created from 2005 to 2017, my colleague Taylor Telford reports. This is exacerbating economic inequality throughout the U.S. as these cities draw highly educated workers, while employment prospects in other areas dwindle, according to the authors of a new report from the Brookings Institution and the Information Technology and Innovation Foundation.

The authors are proposing that Congress pick eight to 10 up-and-coming tech cities away from the coastal hubs and heavily invest in research and workforce development. The authors want lawmakers to run a rigorous selection process to pick the rising tech centers, but suggested a list of potential candidates such as Madison, Wis., and Minneapolis. 

“The nation’s tech-driven spatial divides have reached emergency status and won’t resolve themselves on their own,” said Mark Muro, the study's co-author, in a news release accompanying the report. “It’s time for the nation to push back against these trends and conduct a major experiment to see if we can help eight to 10 promising metros emerge as really dynamic anchors of growth in the nation’s heartland.”

The proposal may have a moonshot price tag, but it could gain traction in today's political climate: Economic inequality is emerging as a central theme of the 2020 elections. Politicians are hungry for creative proposals to address the issue after President Trump's presidential election victory highlighted how many voters feel like they've been left behind by the tech boom.

The report is already catching the attention of some members of Congress. Sen. Chris Coons (D-Del.) and Sen. Jerry Moran (R-Kan.) will appear at an event in Washington later this week to discuss the report and how it could shape the work they're doing on the Senate Competitiveness Caucus. 

“The concentration of tech hubs in a few cities is hurting the middle class, plain and simple,” Coons said in a statement to The Technology 202. “It’s bad for folks outside these cities who miss out on jobs and wealth created by this thriving sector, and it’s bad for workers who can no longer afford to live in these cities.

A spokesman for Moran told The Technology 202 that the senator “remains active in his work to attract employers — including from the tech sector — to regions like Kansas, while also making certain appropriate opportunities are available to start-ups and small businesses.” 

The report's authors note that their $100 billion cost estimate is “substantially less” than fossil fuel subsidies over a 10-year period. To make a real dent, the authors write, Congress would have to invest $700 million in each city per year for a decade. 

The funding would be directed to a wide range of tech research programs, such as additional grants for research universities in these cities and graduate research fellowships. The authors also want extensive regulatory changes to make it easier for these up-and-coming cities to attract and retain top tech talent. They propose a number of tax incentives to make the cities more attractive to high-tech firms. They also are suggesting an antitrust exemption so that companies can invest in cities together, without fear of legal challenges. 

State politicians are taking notice. Wisconsin Gov. Tony Evers (D) has already written to his state's congressional delegation, urging them to consider the proposal. Madison and Milwaukee were among the potential candidates for federal funding the researchers identified. 

"I believe our state has the infrastructure, institutions, and most of all, the relationships and commitment to turn idea into a successful reality," he wrote. "The courage to enact this sort of bold initiative will not just support the communities that receive funding, but will serve to strengthen Wisconsin and the nation as a whole and support our position on an increasingly competitive world stage."

BITS, NIBBLES AND BYTES

BITS: A top Facebook official will defend the company’s plans to expand encryption across its messaging services in front of the Senate Judiciary Committee today. Lawmakers are expected to grill the social network and Apple about law enforcement's concerns that increased encryption will make it difficult for police to find and arrest child sex traffickers and other criminals, as my colleague Joseph Marks reports that the encryption debate is back on. 

Jay Sullivan, Facebook’s product management director for privacy, will emphasize to lawmakers that encrypted messaging is already used by billions of users around the world and argue that granting police special action would weaken cybersecurity for all users.

It's a point supported by 100 privacy and digital rights organizations, industry groups and prominent individuals. “Strong encryption is essential for national security and public safety,” the groups including the American Civil Liberties Union, Human Rights Watch and the Center for Democracy and Technology write in an open letter to the Justice Department this morning.

But lawmakers will also hear law enforcement's concerns. Manhattan District Attorney Cyrus R. Vance Jr. is expected to push back against tech companies' “absolutist position” that lawful access and privacy concerns can't be reconciled, according to prepared testimony published yesterday. Vance will tell lawmakers that federal legislation is the only path forward to forcing tech companies to provide law enforcement with access to encrypted technologies.

“It is unconscionable that smartphone manufacturers, rather than working with government to address public safety concerns, have dug in their heels and mounted a campaign to convince their customers that government is wrong and that privacy is at risk,” Manhattan District Attorney Cyrus R. Vance Jr. will tell the Senate Judiciary Committee, according to prepared testimony. “Tech Goliaths have shown time and again they have no business policing themselves.”

NIBBLES: Facebook's ad targeting technologies may be "more responsible for the polarization of American politics than previously understood," my colleague Isaac Stanley-Becker reports this morning. The new research is the first to illustrate a skew in the delivery of political ads based on their content and the information Facebook has collected on users — not on the targeting decisions made by a political campaign.

This strategy could have big benefits for politicians seeking to engage and fundraise from Facebook users. Facebook also has a business incentive to keep its users engaging with content on its service. But researchers warn it could undermine public debate and make it more difficult for voters to stay informed. 

The researchers found that it was more expensive to show posts to users not already aligned with the ideology of the advertising. A campaign pays more when it tries to reach the other side, the researchers, who are computer scientists at Northeastern University and the University of Southern California, as well as the managing director of the technology nonprofit Upturn, tell Isaac.

Facebook’s ad delivery mechanisms have been hailed as a leap of progress in the commercial advertising sector. But in the context of politics, however, “I think it has the potential to be quite destructive,” one of the study’s authors, Aleksandra Korolova, an assistant professor of computer science at USC, told Isaac. 

Facebook declined to comment on the findings. 

BYTES: TikTok chief Alex Zhu will postpone his trip to meet with members of Congress until “after the holidays,”my colleague Tony Romm reports. The cancellation has increased skepticism over the Chinese-owned company in Washington, where numerous lawmakers have begun to question the company’s privacy and content moderation practices.

Leading TikTok critic Sen. Josh Hawley (R-Mo.) tweeted:

Republican Sen. Marsha Blackburn (Tenn.) similarly slammed TikTok, saying the company owed answers on its data and surveillance practices. 

“TikTok has no higher priority than ensuring Congress members’ questions are addressed fully and transparently,” TikTok said in a statement.

Scheduling conflicts contributed to Zhu's cancellation, Tony reports. But it appears that some of the company's critics were less than eager to meet with Zhu.

 “Senator Rubio is still concerned about TikTok’s ties to China,” the Florida Republican's office told Tony. “TikTok has yet to explain to American users how they protect their data and how much of it can be made available to the Chinese government and Communist Party, which is why Senator Rubio requested that the Treasury Department conduct a CFIUS review.”

PRIVATE CLOUD

— An app that allows Ring doorbell camera users to report crimes within their neighborhoods contains data that could be used to expose the locations of individual Ring devices, an investigation by Dell Cameron and Dhruv Mehrotra at Gizmodo found. The findings are raising questions about the Amazon-owned company's privacy practices.

Gizmodo was able to produce detailed maps depicting the locations of tens of thousands of Ring cameras across 15 U.S. cities, often within just feet of a home address, using network traffic on the “Neighbors” app. Gizmodo estimates having located up to 20,000 Ring cameras in its preliminary search, but location data probably could be used to identify far more. The data remains available, even days after Gizmodo contacted Ring about its findings. (Amazon CEO Jeff Bezos owns The Washington Post).

Ring did not deny that it was possible others using the same network traffic acquired by Gizmodo to pinpoint the locations of users' homes. “Only content that a Neighbors user chooses to share on the Neighbors App is publicly accessible through the Neighbors App or by your local law enforcement.”

— More news from the private sector:

Technology
Vanessa Bain was once an Instacart evangelist, but after drastic pay changes she became one of the most effective agitators against the grocery delivery startup, in what has become a stark test of how much leverage blue-collar on-demand workers can amass to win better treatment from technology companies that keep them at a distance.
Nitasha Tiku
YouTube is asking the U.S. Federal Trade Commission for further clarification and better guidance to help video creators understand how to comply with the FTC’s guidelines set forth as part of YouTube’s settlement with the regulator over its violations of children’s privacy laws. …
Tech Crunch
Apple Inc on Monday told a federal court it has “deep concerns” that two Chinese-born former employees accused of stealing trade secrets from the company will try to flee before their trials if their locations are not monitored.
Reuters
Study calls on GoFundMe to ditch campaigns for unproven procedures.
The Verge

PUBLIC CLOUD

-- Amazon claims that Trump used “repeated public and behind-the-scenes attacks” to prevent the company from nabbing a $10 billion Pentagon cloud computing contract, according to a legal filing made public Mondaymy colleagues Aaron Gregg and Jay Greene report. The company's efforts to prove that Trump influenced the contract process to hurt Bezos, “his perceived political enemy,” probably will ramp up tensions between the White House and the tech giant.

The Pentagon changed its technical requirements after Trump's complaints this summer, disadvantaging Amazon, the company alleges in its complaint. The company is asking a federal court to issue an injunction that would force the Defense Department to restart the bid process.

“Basic justice requires reevaluation of proposals and a new award decision,” Amazon wrote. “The stakes are high. The question is whether the President of the United States should be allowed to use the budget of DoD to pursue his own personal and political ends.”

Amazon cited tweets from Trump that targeted Bezos, Amazon and The Washington Post as evidence of the president's bias. 

A White House spokesman did not immediately respond to a request for comment. The Defense Department has emphasized that the White House had no role in the procurement process.

The unusual merger trial starting Monday could have long-lasting effects on the consumer wireless market and beyond.
The Wall Street Journal
Google is under investigation by the US government over its labor practices and the firing of several employees.
CNN

#TRENDING

—  Tech news generating buzz around the Web:

The streaming service swept Monday’s Golden Globe award nominations, drawing 17 nods as motion-picture distributor, more than the ten received by the top studio distributor.
The Wall Street Journal
TikTok says it’s ready to help its stars get rich.
The New York Times
Midway through his career, the inventor of “cyberspace” turned his attention to a strange new world: the present.
The New Yorker
For anyone not white, cis, or male, it’s obvious where all this is going.
Vice

@MENTIONS

  • Away CEO Steph Korey is stepping down, the Wall Street Journal's Charity L. Scott reports. Lululemon COO Stuart Haselden will replace her.
  • Framebridge has hired Tracey Griffin as Chief Financial Officer and Chief Operating Officer, according to a news release. Prior to Framebridge, Tracey served as CFO at fashion and lifestyle brand Kendra Scott and CFO and COO at Pandora jewelry.
  • Frances Arnold joined the Alphabet Board of Directors, according to a tweet by Alphabet CEO Sundar Pichai.

CHECK-INS

— Today:

  • The Census Bureau will showcase 15 new apps and digital tools at its Technology Demo Day today from 12pm-5pm

— Coming up:

  • The Senate Judiciary Committee will host a hearing, "Encryption and Lawful Acess: Evaluating Benefits and Risks to Public Safety and Privacy," on Tuesday at 10 a.m.