Big Win Against Big Tech Monopolies Today!

I hope you've been following our coverage of the Big Tech antitrust legislation (here and here). This morning all 6 bills passed the Judiciary Committee, the most bipartisan important legislation I've seen in years. The opposition was led by corrupt establishment Republicans (think McCarthy) + the corrupt, corporately-funded New Dems and some Big Tech-owned members, particularly Zoe Lofgren, Lou Correa and Eric Swalwell.

The bill I was most worried about, is the Ending Platform Monopolies Act which will eliminate "the ability of dominant platforms to leverage their control over across multiple business lines to self-preference and disadvantage competitors in ways that undermine free and fair competition." It was the bravest bill of the 6 and the one most fiercely opposed by Big Tech lobbyists and the congress members they own. The lead writers were Pramila Jayapal (D-WA) and Lance Gooden (R-TX), probably the most progressive and most conservative members of the committee! It will be known as H.R. 3825, for all those who want to follow the progress of reining in Big Tech's anti-competitive behavior. As Pramila has been telling us this bill is all about "restoring fairness, competition and innovation while leveling the playing field for small businesses."

If you want to reward or show some solidarity with someone who has worked her fingers to the bone for 16 months and then successfully pushed back against the Big Tech lobbyist onslaught over the last few days, please consider clicking on the 2022 worthy incumbents thermometer on the left and letting Pramila know you appreciate her by contributing whatever is comfortable to her reelection campaign. You can be sure, Big Tech will finance a challenger.

After the vote today, she said that "As these companies continue ramping up special interest lobbying campaigns to maintain their dominance, we are stepping up for workers, consumers, small businesses, local independent journalism, and our communities. My legislation is a structural solution to a structural problem, and I will continue working to move it forward so we can make it law.”

H.R. 3825 addresses the anti-competitive conduct by making it unlawful for a dominant online platform-- namely Google, Apple, Amazon, and Facebook-- to simultaneously own another line of business when that dual ownership creates a conflict of interest. Companies in violation could have to divest lines of business where their gatekeeper power allows them to favor their own services or disadvantage rivals.

A key moment of the investigation occurred in July of 2019 when Pramila asked Amazon’s Associate General Counsel about the tech giant’s use of third-party seller data to create products that compete with small businesses on their platform. Under oath, he said, "We do not use any of that specific seller data in creating our own private brand products" to compete with businesses on Amazon’s platform. Nearly a year later, the Wall Street Journal published a report that found this to be false; Amazon has been using data from its own independent sellers-- small businesses across America-- to launch competing products. Additionally, a former Amazon employee told the Antitrust Subcommittee that when it comes to using seller data, it was, "a candy shop where everyone can have access to anything they want." In July of 2020, Pramila asked Amazon CEO Jeff Bezos about this anti-competitive practice and, as much as he may have wanted to he couldn't deny it. That led directly to the big win today.

A press release from the American Economic Liberties Project, a nonprofit advocating for antitrust enforcement, noted that "Congress stood up to the most powerful corporations, and breaking up these firms now seems inevitable."

The executive director said that "The committee achieved a number of important objectives. It passed two bills that would increase funding for the antitrust agencies and stop the ability of monopolists to forum shop in antitrust cases involving state attorneys general that should be signed into law as soon as possible. Along with Lina Khan as the Chair of the Federal Trade Commission, these bills alone could translate into the most important strengthening of federal antitrust enforcement in 50 years. At the same time, the committee also passed tech-specific bills intending to break up the tech giants and address monopolistic practices including self-preferencing, blocking rivals and partners from connecting to their critical services, and buying out competitors.

“We are encouraged the committee took action to address these problems, and we are delighted that the committee voted explicitly to split apart and simplify these firms. As Congressman Mondaire Jones noted, ‘unless we break these companies up, they will continue to be above the law.’”

“Going forward, addressing Big Tech’s abuses effectively as intended will require adjustments to the legislation. There are two challenges to be overcome. First, the bills defer excessive authority over critical policy decisions to regulators. Second, the bills rely on language that will be narrowly interpreted by the judiciary to define what types of corporate behavior is and is not permissible. Since judges today tend to be hostile to the appropriate enforcement of antitrust laws, this would likely retain the monopoly-friendly status quo, contrary to Congressional intent. We encourage Congress to continue to develop and advance structural separation and merger legislation that would set clear, specific rules of the road for market participants.”

“Protecting working people, honest businesses, entrepreneurs, communities, and our democratic institutions from four of the world’s most pernicious monopolies is an urgent task, and one that we’re confident that Congress, working alongside the enforcement agencies and state authorities, will complete.”

Writing for The Verge today, Casey Newton reminded his readers that the bill "would increase funding for antitrust enforcement by 30 percent [and] empowers the Federal Trade Commission and the antitrust division of the Department of Justice to scrutinize M&A more carefully."

He also noted that "The House bills all have Republican co-sponsors, and appear to enjoy some support in that delegation. But key Republicans have so far refused to engage with any of these bills on a policy level, insisting instead that tech reform begin (and possibly end?) with prohibitions on 'censorship.' Galled by the removal of former President Trump from Facebook, Twitter, and other platforms, and perhaps energized by Florida’s recent passage of a (likely unconstitutional) bill that would make such content moderation illegal, some Republicans want to throw out the entire process. Members of Congress in this camp include the House minority leader, Kevin McCarthy, and Rep. Jim Jordan, the ranking Republican on the Judiciary Committee.

Set aside for a moment the fact that Trump was removed from these platforms because he was using them in an effort to overturn the results of a fair election, the thing to highlight here is that Republican leadership’s concerns have nothing to do with “competition” per se. Instead, their outrage is rooted in the idea that anyone else might have power over their speech.

We know what happens when elected officials are allowed to post whatever they want online-- they attack minorities, they manufacture influence operations against their own citizens, they chip away at the foundations of democracy. (This has been the story in India for the past year, and if you assume it is a preview of the next Republican administration here in the United States, as I do, it’s quite chilling.)

For these Republicans, then, the goal is not actually to make platforms like Facebook and Twitter less powerful-- it’s to ensure that they can use those platforms’ power to achieve their own ends, and to make it illegal for anyone to stop them. When Trump shut down his blog 29 days after starting it, it wasn’t in protest of platforms’ power-- it was out of the frustration that he no longer had access to it.

...Democrats will struggle to find 10 Republicans in the Senate to sign on to most of these bills, and perhaps to any but the one providing extra funding for antitrust enforcement.

For as long as the parties have spent agreeing that somebody ought to do something about Big Tech, in important ways they are still talking past one another.

...There is a split between progressive and moderate Democrats in just how far these bills should go to reshape the economy. And some bills go quite far-- Rep. Pramila Jayapal’s Ending Platform Monopolies Act would permit the government to sue big platforms to break them up-- Amazon could be forced to divest itself of its logistics network and of Amazon Web Services, for example; Facebook could have to spin out Instagram and WhatsApp.