The Cambridge Cyber Summit

Microsoft's president says Congress needs to act on DACA this year

Key Points
  • Smith is one of many technology leaders urging elected officials to protect DACA recipients.
  • He said that Congress has a limited amount of time to get to work on the issue.
  • Smith also spoke about tax reform and cybersecurity.
Microsoft General Counsel and Executive Vice President Brad Smith addresses shareholder during Microsoft Shareholders Meeting December 3, 2014 in Bellevue, Washington.
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Immigration reform has enough support in Washington that Congress should be able to take action this year, said Brad Smith, Microsoft's president and chief legal officer, in an interview on Wednesday with CNBC's "Closing Bell."

Smith has spoken out on several social issues in his role as a technology leader, tweeting in support of marriage equality in Australia and the Deferred Action for Childhood Arrivals program. That program, commonly called DACA, shields immigrants who were brought to the U.S. illegally as children from deportation.

The Department of Homeland Security recently said it would phase out the program. President Trump has wavered on the issue and said in September that there would be no action for six months, but that it was the job of Congress to legalize DACA.

Smith is one of many technology executives to support letting DACA recipients stay in the U.S., the only home that many of the immigrants have known. But legislators needs to take up discussions soon, Smith said.

"It should be possible to move quickly and use a quicker victory to build momentum on Capitol Hill to then accomplish bigger and more substantial things," he said.

On the issue of tax reform, Smith's position is more in sync with Republican leadership.

Microsoft's Brad Smith: We basically have a tax system that was designed in 1961

Smith said that Microsoft, like many exporters, is looking forward to a large tax package enacted in the coming months. President Trump has pledged to temporarily relieve taxes on the repatriation of profits that are stashed overseas, which could allow companies like Microsoft to invest money domestically or return cash to shareholders.

"We basically have a tax system in this area that was designed in 1961, and it creates economic incentives to keep profits offshore," Smith said. "We could make good business decisions free of the artificial constraint of a tax rule that we've been living with for over five decades."

Smith spoke from The Cambridge Cyber Summit, presented by the Aspen Institute and CNBC. Technology companies are often at odds with the government over the handling of cybersecurity. Most notably, Apple spent much of 2016 battling the FBI over allowing government access to encrypted devices, commonly called a "backdoor."

"The last thing we should do is to create a backdoor," Smith said. "It leaves law enforcement challenges, and that then gets to a more complicated, and sometimes nuanced, discussion."

Microsoft CEO Satya Nadella recently told CNBC that cybersecurity is "top of mind" for Microsoft, as society comes to terms with regulating the "dark side" of technology. Over the past 15 years, the company has developed a system to view what's happening at more than 1 billion endpoints in its cloud in real time. The company uses those insights to prevent malicious code from spreading across software like Outlook and Office.

While the U.S. government's stance on encryption has improved considerably from a year ago, according to Smith, he said that he feels worse about the nation's cybersecurity. Nation-states are creating more sophisticated and varied attacks and cybercriminals are hacking to make money, Smith said.

"In all honesty, I probably feel worse, rather than better," Smith said. "It's less about a specific conversation with a specific government and more about the rising tide of attacks that we're seeing."

Watch: Microsoft CEO Satya Nadella discusses cybersecurity

There's a dark side to every new technology: Microsoft CEO Satya Nadella