(I like the accidental pun of "Clout Provider" btw, which sadly conveys some of what they try to imply).
We may not be disagreeing that much. My argument was, and is, it's not about where the data is, it's about who has control over it. The counter-argument was "well if it's in another country, then we don't have jurisdiction, so it's going to be much harder". But what you need jurisdiction over is the people. Otherwise, you end up with multi-national corporate end-runs where you have shonky companies offering to store data locally, but who knows what department has control and access.
To be fair, the context I was having these conversations was countries arguing for data residency to combat the threat of mass surveillance (corporate and governmental) in the US, and the limited protections their users had relative to US nationals. But again, the problem is that it assumes that jurisdiction remains territorial: which is not how this was ever going to play out. The next wave after data residency requirements, beyond the usual extraterritorial intelligence community actions, was laws like the US CLOUD Act, the UK's Investigatory Powers Act, and Australia's TIA law, which effectively attempts to provide regular government departments and law enforcement with the legal ability to access data that would technically be on foreign soil.
My point was not that corporations should not self-police, but the concept of "it's stored here so we can oversee it" is not as clearcut as it seemed, and it risks introducing a new level of complexity to resiliently storing data. Which may be worth the price, but was never considered at the level this was discussed.