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After yet another Congressional hearing on antitrust enforcement against big tech, it is being widely reported that a forthcoming report by Democrats on the Subcommittee on Antitrust will recommend breaking up several digital economy titans. This seemed inevitable; Chairman Cicilline (D-R.I.)’s remarks during the previous hearing, and for years prior, make clear that the desire to break up Big Tech was not contingent upon evidence gathered from hearings. What is disturbing from a conservative standpoint is the possibility that some Republicans are likely to at least partially join those calls.
As I have written previously, antitrust enforcement is absolutely not the way to address conservative concerns about Big Tech’s moderation practices or other non-economic concerns. However, even if there are real concerns about the competitive practices of companies like Google, Apple, Amazon, or Facebook in terms of economic impact, it’s important to recognize that the current populist dislike for Big Tech does not mean progressive Democrats share a common cause.
It’s not as if lawmakers like Rep. Cicilline, Sen. Elizabeth Warren (D-Mass.), or Sen. Amy Klobuchar (D-Minn.) have been subtle about their aims for antitrust. Last year, Sen. Warren and Rep. Cicilline were reported to be working together on a bill that would have explicitly blown away the existing consumer welfare standard for antitrust enforcement. Warren, for her part, has been even more explicit than Rep. Cicilline in her desire to break up big tech firms, no matter what.
Rep. Cicilline and other progressives have also toyed with the nonsense analogy of creating a “Glass-Steagall for the internet,” amid concerns about the tech giants purchasing a broad array of outside services. This assault on both vertical integration and expansion threatens to create higher costs to consumers and to curtail an important avenue for startup companies to make it big.
The great victory of the existing legal restraints on antitrust is that the consumer welfare standard is fairly objective, relying on producing demonstrated and deliberate economic harms. By contrast, a ‘feature’ of antitrust enforcement under a less objective standard is that some of the competitors of the largest companies are always willing to join in with the “big is bad” crowd. It’s noteworthy that just like back during the “robber baron” days, many of the complaints against companies like Google or Amazon are that their prices are too low. In this sense, once again, breaking up these big companies stands to benefit other companies, but not consumers.
In a free market, companies can attain great wealth and dominant market shares because they are producing products or services that others desire better than their competitors. If their success leads them to stagnate, or if their competitors simply innovate to provide a better product, that market dominance can go away seemingly overnight.
Finally as TechFreedom’s Asheesh Agarwal reminds us, if and when the Department of Justice rolls out an antitrust case against Google, or the Federal Trade Commission does the same against Facebook, there is an existing, thorough, and hopefully more impartial legal process in place to handle them.
Expanding the scope of antitrust laws would inject more political influence into that process and further increase uncertainty among the very companies that we need to be driving economic growth. But most importantly, it would play right into the hands of the authoritarian interventionists on the Left.