As we navigate the current economic climate in California, small and medium-sized businesses in Los Angeles find themselves at a significant crossroads. With rising taxes and an increasingly convoluted regulatory environment, these enterprises already face heightened ownership costs that threaten their survival. The Kids Online Safety Act (KOSA), which passed the U.S. Senate this summer and currently sits in the House, introduces an additional challenge that could impact not just the tech sector but the very foundation of our local economies.
KOSA, marketed as a protective measure for minors, introduces broad regulatory powers that could have far-reaching consequences for online platforms. The bill allows federal regulators and state attorneys general to pursue legal actions against businesses for hosting content deemed harmful to minors.
Businesses across Los Angeles County will be thrust into a complex regulatory maze, forced to reconcile the need for free speech with nebulous content guidelines imposed by the Federal Trade Commission (FTC) and state regulators.
Many implications
The implications of KOSA extend beyond compliance burdens; they divert critical resources across various sectors. For tech companies, particularly those with young user demographics, this legislation will shift attention and funding away from innovation (and instead) toward navigating compliance. When critical resources are absorbed by regulatory demands, the ripple effect adversely impacts all aspects of a business, from research and development to consumer engagement.
Moreover, KOSA carries the risk of fostering an environment of excessive content moderation. The potential for overreach by regulators could mean that resources – such as support and information for vulnerable communities – could be unfairly censored.
This suppression directly undermines the mission of many small businesses aspiring to create inclusive spaces.
California’s regulatory framework already presents significant obstacles for small businesses, imposing high compliance costs. If KOSA is enacted, applying California’s stringent regulations nationwide could suffocate small enterprises at a time when they can least afford it. This additional complexity threatens not only business viability but also the socioeconomic fabric of the communities they serve. Many businesses in our state operate on thin margins, and adding another regulatory hurdle could push some to closure.
Importance of understanding its impacts
As stakeholders in the economic vitality of our communities, it is our responsibility to urge California’s Congressional leaders to scrutinize the implications of KOSA. The risk of adding another regulatory burden could have damaging effects that reach beyond initial intentions. Our elected officials must strike a balance – protecting youth is crucial, but it should not come at the expense of hindering the growth and sustainability of our small businesses.
We must advocate for regulations that genuinely protect minors without sacrificing the foundational values of our entrepreneurship ecosystem.
The vitality of California’s economy rests on our small business community, and it is critical that we defend their interests. In doing so, we ensure that our communities continue to thrive in an ever-evolving marketplace.
Opposing KOSA in its current form isn’t about maintaining the status quo; it is about preserving the spirit of California’s entrepreneurial landscape and promoting policies that benefit both small businesses and the communities they support. Let us call upon our elected representatives to champion a future where regulatory frameworks empower innovation rather than hinder it.
Together, we can advocate for legislation that recognizes the need for child safety while fostering an environment that nurtures the growth and sustainability of small businesses (that are) essential to driving the economy forward.
Patrick Kirkwood is the Executive Director of the Los Angeles LGBTQ Chamber of Commerce (LAGLCC), which provides visibility, advocacy, and business development support to the LGBTQ and allied business community in Los Angeles.
