The Global Meltdown of Brand Obama

Will Latest Spy Revelations Hurt U.S. Marketers' Ability to Do Business in the E.U.?

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U.S. President Barack Obama
U.S. President Barack Obama Credit: Andrew Harer/Bloomberg

Over the weekend, you may have noticed, all hell broke loose in Europe over the latest National Security Agency spying revelations. As Germany's Der Spiegel headlined the unfolding scandal: "Attacks from America: NSA Spied on European Union Offices." The news magazine's summary:

America's NSA intelligence service allegedly targeted the European Union with its spying activities. According to SPIEGEL information, the US placed bugs in the EU representation in Washington and infiltrated its computer network. Cyber attacks were also perpetrated against Brussels in New York and Washington.

A follow-up, titled "Spying 'Out of Control': EU Official Questions Trade Negotiations," begins, simply, "Europeans are furious." It chronicles the blistering media storm and suggests that imminent free-trade negotiations between the European Union and the United States could be derailed by the scandal. Der Spiegel quotes Jan Philipp Albrecht, member of the European Parliament, as accusing the NSA of "espionage against democratic countries and their institutions," while European Parliament Foreign Affairs Committee Chair Elmar Brok asks the obvious question: "How are you supposed to negotiate when you have to worry that your negotiating positions were intercepted?"

Yesterday, The New York Times published a guest editorial written by German politician Malte Spitz titled, "Germans Loved Obama. Now We Don't Trust Him." It's a relatively calm, measured essay -- but that's because it appears to have been written before Der Spiegel's weekend bombshell. Still, reacting to prior NSA spying revelations, Spitz makes it clear that Germans blame Obama personally for failing to reign in the NSA, given that he campaigned against the surveillance-state excesses of the Bush administration. Spitz's editorial also implicates "private companies":

Lots of young Germans have a commitment not only to fight against fascism but also to stand up for their own individual freedom. Germans of all ages want to live freely without having to worry about being monitored by private companies or the government, especially in the digital sphere.

I'll note here that a couple weeks back I published a column titled "Will 2013 Be the Year Silicon Valley's Global Domination Begins to End?," in which I criticized President Barack Obama's "comical" miscalculation that he could minimize the NSA scandal by reassuring Americans that the Prism surveillance program only targets foreigners (an assertion that has since been vigorously challenged). As I wrote at the time, a funny thing about foreigners is that they don't like being spied on either.

I suggested that the NSA Prism scandal would only only accelerate the rising movement to strengthen privacy regulations in the EU and would compromise the ability of American companies like Facebook and Google to do business in the EU because they're now seen as untrustworthy stewards of consumer data given their apparent (willing or unwilling) cooperation with the NSA. I predicted that the "foreigners" the NSA seems so eager to spy on would "make life for American tech companies way more difficult from here on out."

Now that Der Spiegel has reported that the NSA was targeting not only EU civilians, but EU politicians, well, European leaders have all the more reason to hobble the American data-hoarding tech giants by instituting new regulations on what information, exactly, they're allowed to collect on EU consumers. And data-happy U.S.-based marketers that do business in Europe will also surely face increased restrictions.

Meanwhile, the comic has become tragicomic. According to the Washington Post,

Secretary of State John F. Kerry said he was taken by surprise Monday when European Union foreign policy chief Catherine Ashton questioned him... about reports that the United States conducted electronic monitoring of E.U. offices and computer networks. "I honestly hadn't heard about it. I hadn't seen any of those reports," said Kerry, who has spent the last several days immersed in shuttle diplomacy in the Middle East.

Simon Dumenco is the "Media Guy" media columnist for Advertising Age. Follow him on Twitter @simondumenco.

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