The Market Institute President Charles Sauer has a new article in Real Clear Markets asking why some conservatives are so quick to have an anti – “Big Tech” Republican fill in the vacant seat on the FTC Board.
“Several conservative organizations recently wrote Senate Republican leader Mitch McConnell urging him to support filling the vacant “Republican” seat on the Federal Trade Commission (FTC) with someone willing “to take on the unchecked power of the most powerful Big Tech companies, especially given how these companies have weaponized their combined market power to directly interfere in our free and fair elections.” These conservatives are embracing the agenda of FTC Commissioner Lina Khan. Under Khan’s leadership, the FTC has abounded the tractional “consumer welfare” standard of antitrust enforcement in favor of a “holistic” approach that would allow the FTC to use antitrust law to dramatically expand government power.
Khan is particularly interested in going after “Big Tech” (e.g., Meta, Amazon, and Google). As the quote above illustrates, the Khan-conservatives are also motivated by an understandable animus towards “big tech” companies.
In support of their claim that big tech “directly interfered” in the elections, the letter cites a 2017 report claiming that by manipulating search results relating to the 2016 Presential candidates, Google “convinced” between 2.5 million and 16 million voters to vote for Hillary Clinton. What the letter fails to mention is that the report is based on a study where 21 out of 95 participants supposedly had their view of the candidate changed because of the manipulated search results, The study has been criticized for “weird methodology” and was not peer-reviewed.
In fact, of the studies citied to support the findings only one has been peer reviewed, the only positive thing said is that Google swaying millions of votes is more plausible than the idea that Vladmir Putin’s army of Internet trolls somehow installed Donald Trump in the Oval Office.
Khan-conservatives, like their so-called progressive counterparts, confuse being a big or leading company with being a monopoly with “unchecked power.” For instance, they call Google a monopoly. However, Google does not fit the definition of a monopoly as it does not have “exclusive control over a good or service or the trade in that good or service.”
While Google is the world’s most popular search engine, it does not fit the definition of a monopoly.
We all use lot of devices – in fact, I have three devices to access the internet, my office computer, my laptop, and my iPhone. The only one of those that I use Google on is my office computer. My laptop uses Microsoft Edge, and my iPhone uses Safari. Yet, according to the Khan conservatives, I am deprived of a choice of search engines because of Google’s unchecked monopoly power.
The letter to McConnell also complains about the FTC’s failure during the Obama years to stop Facebook/Meta from acquiring What’s App and Instagram. The underlying allegation is that the acquisition “cemented Facebook’s monopoly power.”
This would be news to Meta’s shareholders who have watched the value of their holding suffer a 55 percent decline between September 2021 and June of this year. This is largely due to young people abandoning Facebook and Instagram for other sites like Tik-Tok. If the Khan-servatives are stretching any reasonable definition of monopoly when it comes to Google, they are obliterating it when it comes to Meta.
Meta is not the only tech company the Khan-servatives want to stop from acquiring small companies. Khan conservatives want the FTC to aggressively review all mergers and acquisitions involving a large technology company with an eye to limiting big companies’ acquisitions of smaller companies. This will lead to less innovation in the tech market. Many investors are attracted to tech start-ups because they know if the company succeeds, they will receive a large payoff when one of the major companies buys them out. (This is literally the plot of the show Silicon Valley.)
If the Khan-servatives (and progressives) get their way this incentive to invest in tech startups will either be substantially reduced or eliminated entirely.”
Read the rest of the aricle at Real Clear Markets by clicking here.