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America Can’t Wait for Legislators to Rein in Big Tech. The Biden Administration Must Focus on Antitrust

5 minute read
McNamee began his Silicon Valley investing career in 1982. He was an early investor in Facebook and an advisor to Mark Zuckerberg. He is the author of the New York Times bestseller Zucked: Waking up to the Facebook Catastrophe.  

President Biden faces challenges greater than any president since FDR. The country is struggling with a deadly pandemic that has shaken the economy and exposed its structural flaws. His political opponents refuse to engage with those challenges, choosing instead to focus their efforts on undermining democracy. Powerful business interests in technology, health care, finance, energy, and agriculture are pursuing agendas that make President Biden’s job all the more difficult. But perhaps the most uniquely destabilizing force in America today is the major internet platforms. Their business models fundamentally reduce human agency, and, in some cases, threaten democracy and public health, as we have seen during the COVID-19 pandemic.

Even if Republicans were willing to cooperate, there would not be enough time in the congressional calendar to address all of these issues through legislation. As things stand, the legislative calendar prior to the 2022 midterms is likely to be dominated by infrastructure and voting rights. Fortunately, there is much that the executive branch can do. Given the scope and novelty of the challenges, President Biden will be best served by appointees who share his bold vision and are willing to embrace new approaches to large and difficult problems.

The first round of appointments in the Biden administration include cabinet officers and other officials committed to reversing the worst excesses of the Trump years, in areas such as immigration, use of federal lands, and foreign policy. This is essential, but not enough.

The pandemic has exposed structural flaws in our economy caused by concentrated economic power. For forty years, the country has allowed markets to rule the economy with ever diminishing oversight, which has led to massive income inequality and the exploitation of essential workers. Employees are powerless to improve their lot, due to lack of alternatives and our country’s unique approach to health insurance and the financing of higher education.

A small number of choices led to our current predicament and the Biden administration has an opportunity, and perhaps a need, to reverse them all. The list begins with conservative jurist Robert Bork’s successful effort to free capital from regulatory constraints. The elimination of laws like Glass-Steagall in 1999 helped to shift the financial markets’ focus from capital formation for economic growth to capital harvesting through trading and private equity. The Obama administration’s decision in 2013 not to prosecute a major antitrust case against Google helped unleash surveillance capitalism. In each case, the benefits of these choices accrued to the privileged, while the harms—to the economy, public health, democracy, and the right to self-determination—have touched the overwhelming majority of Americans. For example, the repeal of Glass-Steagall helped lead to financial crisis of 2008, which cost Americans an estimated $12.8 trillion.

The costs of not prosecuting Google are still mounting, but that case enabled internet platforms to build a huge business on personal data and to influence and sometimes manipulate user behavior. In addition to undermining personal autonomy, platforms like Facebook, YouTube, Instagram, Google and others have amplified disinformation that harmed public health during a pandemic and democracy during two presidential elections. The concentrated economic power of internet platforms has also caused harm to journalism, book publishing, music, and a wide range of small businesses.

Internet platforms allow a separate reality for every American. Democracy depends on a shared set of facts, and the Biden administration’s voting rights agenda should include policies to limit harm to democracy from internet platforms. Such policies can help us fully beat the pandemic and revive the economy. In the short run, the best tool will be antitrust law enforcement by the executive branch. Antitrust is not a complete solution, but it can buy time for legislation.

Right now, Google and Facebook are the subject of two federal and five stage antitrust cases. The Antitrust Division of DOJ is leading only one of those cases. That needs to change. The top priority should be to intervene against the industries where concentration of economic power has aggravated the economic and human cost of the pandemic, specifically internet platforms, health care, agriculture, and banking.

This will require a new approach to antitrust enforcement, lead by new blood not involved in the formulation and execution of the policies of the past four decades. President Biden has taken a step in that direction with the appointment of Lina Khan to the Federal Trade Commission, but two key seats remain open: the chair of the FTC and the assistant attorney general at the top of the DOJ antitrust division.

For these critical roles, the administration must select nominees with the track record and integrity to inspire confidence among the public given that so many previous officials have been previously enlisted in Big Tech’s defense. Many names have circulated, all people with impressive experience. Unfortunately, many of those candidates played a role in formulating or defending policies that must be reversed.

The most qualified pick for this time and situation would be Jonathan Kanter, who began his career at the FTC, co-chaired the antitrust practice at one of Washington’s leading law firms, and developed the theories underlying successful antitrust actions against Google in Europe and the US. Given recent Republican support for antitrust intervention against internet platforms, an aggressive choice might be welcome in Congress.

Antitrust enforcement is not a silver bullet for the economy, but in the face of great challenges, it presents President Biden with a chance to halt a wide range of harmful behaviors and buy time for legislative action. But without the right person leading the government’s antitrust enforcement efforts, we won’t stand a chance.

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