Silicon Valley’s Declining Image Is Harming America’s Prestige

Remember when Silicon Valley was America’s greatest export?

It wasn’t long – just over a decade – that Silicon Valley occupied a rare space in the global imagination. The founders of American technology companies were some of the greatest disruptors, optimists, and engineers who reshaped sclerotic political systems and extractive industries. While politicians hesitated, big tech companies were designing solutions.

Remember when Silicon Valley was America’s greatest export?

It wasn’t long – just over a decade – that Silicon Valley occupied a rare space in the global imagination. The founders of American technology companies were some of the greatest disruptors, optimists, and engineers who reshaped sclerotic political systems and extractive industries. While politicians hesitated, big tech companies were designing solutions.

From Beijing to Berlin, delegations arrived in Mountain View and Palo Alto asking the same question: How can we replicate this? The world didn’t just want Apple’s iPhones or Google’s search engine. She wanted America’s culture of innovation, the myths of garage startups, and her belief that smart people who use code can build a better future.

This faith collapsed with astonishing speed. And with it is one of the pillars of American soft power.

Today, technology companies occupy the space once reserved for Big Tobacco and Big Oil, and are reviled, distrusted and facing a global regulatory backlash that would have been unimaginable a decade ago. The numbers tell a grim story. In the US, negative views of big tech companies rose from 33% in 2019 to 45% by early 2021, with those with “very negative” views doubling from 10% to 22%. Votes calling for increased government regulation rose from 48% to 57%, a notable shift in a country generally skeptical of government intervention.

But what should worry Washington is that Americans are not the only ones who feel this way. After two decades as the most trusted sector in the 28-country Edelman Trust Barometer, technology is now causing more and more concern, especially in the developing world. This is part of a larger pattern of declining trust in the technology sector, captured in the Thales Digital Trust Index 2025, which surveyed 14,000 consumers in 14 countries: No category within the technology sector achieved 50% agreement when consumers were asked who they trust with their personal data. Social media – dominated by US platforms – was among the lowest at just 4 percent. Perhaps even more alarming, 82% of consumers abandoned a brand in the past year due to data concerns.

This is not just a business problem. For decades, American technology has been one of the country’s most powerful soft power tools—a concept famously defined by Joseph Nye as the ability to shape global preferences through attraction rather than coercion. If Hollywood exported American culture, then Silicon Valley exported American values: freedom of expression, privacy, respect for diversity, and creativity that is not limited by old-fashioned thinking. When the world ran on American technology, it ran on an American operating system, both literally and figuratively. This gave it a huge geopolitical advantage.

Now this advantage is eroding. Consider what happened on March 29, when tens of thousands of protesters gathered at more than 200 Tesla locations around the world — not just in the United States, but across Canada, Europe, Australia and New Zealand. Protesters in the United Kingdom held signs reading: “Did you think Nazis were extinct? Don’t buy swastikas.” In Paris, demonstrators carried banners reading, “Send Musk to Mars now.” In west London, protesters told reporters they felt compelled to act because “it is very difficult to do nothing.”

The Tesla Takedown protests targeted Elon Musk’s political activism. But it revealed something even more troubling: a major US tech company had become a source of international outrage, sending thousands onto the streets in a number of countries at once.

Or consider the reaction when the European Union fined Apple €500 million and Meta €200 million on April 23 for breaches of the Digital Markets Act. These were the first sanctions under the EU’s new tech rulebook, a set of regulations that exists because the public and European policymakers have concluded that American tech giants cannot be trusted to regulate themselves. European Commission President Ursula von der Leyen introduced the subtext, declaring that “our digital laws must be enforced consistently, regardless of where companies are located.” Translation: American exceptionalism no longer applies in the digital sphere.

The transformation of Big Tech follows the path of previous evil companies. Just as tobacco companies marketed cigarettes while knowing about cancer, and like oil giants who knew about climate change while denying funding for it, technology companies have declared their ignorance while working to improve engagement at all costs. Internal documents revealed what Facebook knew about teens’ mental health and how Instagram’s algorithm targeted vulnerable girls. Researchers have also documented how YouTube has become a machine for extremism and how Twitter’s design has allowed harassment to flourish while increasing traffic and revenue.

The damage was not limited to American shores, which is precisely why the losses resulting from soft power were so severe. Facebook served as a platform for incitement to genocide in Myanmar. WhatsApp has become a vector of deadly misinformation in India. YouTube has radicalized viewers from Brazil to Germany. When American technology facilitates acts of mass violence abroad, when American platforms undermine democratic discourse in allied countries, and when American companies treat foreign users as test subjects for algorithms optimized for addiction rather than well-being, this reflects poorly not only on companies but on America itself.

Previous administrations have made tentative efforts toward accountability, but tech companies have resisted fiercely, hiding behind appeals for freedom of expression and innovation. The resistance only served to deepen international suspicions. When European regulators finally intervened, American technology companies cried foul about protectionism. But the Europeans said that if American companies won’t police themselves, and Washington won’t police them, someone must.

The tragedy is that American technology has truly been a force for good in many ways. It has empowered entrepreneurs, spread knowledge, and created wealth. It has empowered activists and pro-democracy movements. iPhone has already put powerful tools within the reach of billions of hands. Google has truly democratized information. These innovations have carried American values ​​to every corner of the earth.

But that’s mostly the past tense now. Today, European consumers view American platforms with suspicion. Democratic governments, from Brussels to Canberra, are putting in place regulations explicitly designed to restrict US technology companies. Citizens around the world are deleting apps, canceling subscriptions, and looking for alternatives — 82% of them, according to Thales — because they no longer trust what American tech companies are doing with their data.

This is how soft power dies: not in dramatic confrontation, but in the accumulated weights of betrayed trust. When the world’s digital commons become toxic, and American corporations own it, America itself becomes associated with that toxicity. When teens around the world suffer from mental health crises amplified by American algorithms, their parents don’t just blame Facebook, they blame America. As democracies disintegrate under the pressure of algorithmically amplified anger, their societies are not only calling for regulation, but rethinking their relationship with American technology wholesale.

The trade consequences will take time to play out, not least because there are so few non-US alternatives to the dominant companies. But the damage may already be irreversible. A decade ago, countries aspired to build their own Silicon Valleys. Today, they aspire to regulate the asset. This is not just a commercial setback, it is a geopolitical disaster. Because if the world no longer wants what American technology offers, it no longer wants to be like America. If it does not want to become like America, American influence, the real currency of global power, will decline in value.