“Never Seen Anything Like It”
It’s not clear if Matt Stoller’s brand has been tainted by his brief late-night association with Russell Brand a decade ago. Stoller has nonetheless plunged ahead with his blog, BIG, where he covers “the politics of monopoly power.”
Stoller reports — will wonders never cease? — that federal enforcement actions against monopolies is on the upswing:
Before the Biden administration, antitrust was mostly dead. It had picked up a bit under Trump, but mostly no one thought much about this area of law. And the reason was pretty simple. Nothing was happening. The FTC was using its authority to go after powerless actors, such as Uber drivers, church organists, bull semen traders, and ice skating teachers.
The changeover has been absolutely stark, and it’s accelerating. Many of my sources in the competition policy world are giving me the same message, which is that this is the most extraordinary month they have ever seen in antitrust.
There are the big fights, the cases against Google and Amazon, the suits against private equity and meat price-fixing. There is also smaller stuff, the behind-the-scenes institutional changes, like funding levels for antitrust enforcers and newly populist conservative nominees for regulatory agencies that could make a more assertive competition agenda part of a new bipartisan consensus. The rearguard opposition to change is immensely powerful, but the forces of the status quo are actually losing.
What’s also fascinating is that public interest and attention is going up, and that it matters. Practitioners in antitrust used to have to explain what they do, now they are being pestered with questions by friends and family. We’re also getting hints, ever-so-slight ones, that judges themselves are starting to think about corporate power.
If you’ve been gasping for a breath of fresh air in this political climate, take a big gulp of it (and some sanitizing sunshine) here:
September 12: The $2 trillion Google antitrust trial begins. This is the first major monopolization case to hit the courts in 25 years, since Microsoft in 1998. Google’s 90% market share in search has allowed it to control not only the gateway to the internet, but also the future of technological deployment, including generative AI. The key question at trial, which I laid out back in August, is as follows. Why does Google have this monopoly? Google argues it’s because it’s a great search engine, the government argues it’s because Google pays everyone who preloads search to block rivals from access to the market.
We set up a site, Big Tech on Trial, and hired reporter Yosef Weitzman to write a daily recap from the courtroom. The trial has generally gone well for the government, with good evidence that Google thwarted competition from small firms (Branch Technologies) and big ones (Microsoft and Apple), using payoffs. Google has scored some wins as well, so it’s hard to know the outcome. Interestingly, the judge in the case, Amit Mehta, started off by deferring to Google’s demands for secrecy. But we’ve been advocating for more openness, and our pressure worked.
On Friday, Judge Mehta actually demanded lawyers do more questioning in open court, and not closed session. He’s also going to be unsealing testimony, and he told both parties that “he wants Microsoft CEO Satya Nadella’s testimony next Monday to be as open as possible.” It’s rare to have a judge change his mind, but that seems to be happening. A bit.
Here are a couple more items from just September:
September 20: Attorney General Merrick Garland advocates against a $50 million cut to the Antitrust Division’s budget. This was a seemingly tiny but very significant moment in a hearing in the House Judiciary Committee this week. Republican Congressman Ken Buck asked Attorney General Merrick Garland about funding for the Antitrust Division. There has been an attempt to cut $50 million from the Division, which is an 18% cut. This cut is largely coming from Senate Democratic staff who are annoyed that antitrust enforcers are getting a boost. Garland explicitly said he wants this money to go to the Antitrust Division, which will make it much harder to deny the funding.
This funding matters. The Antitrust Division is smaller than it was in the 1970s, and without the extra funding, it will have to cut the amount of investigations and cases it can bring. It is these kinds of institutional levers, more money for agencies, and GOP commissioners who actually want to tackle monopolization, that can meet the increasing anger coming from the public.
September 21: FTC goes after Amazon executives personally for deception of customers involving canceling one’s Prime subscription, which internally Amazon officials returned to as the Iliad, referencing the Greek poem about the lengthy Trojan war. Charging individual executives is making waves among corporate lawyers, who are very angry that the FTC is now targeting individuals at large powerful firms, instead of its historical track record of targeting the powerless
Having recently read David Dayen’s chilling, pre-insurrection “Monopolized: Life in the Age of Corporate Power” (2020), it’s nice to see some pushback against the giants whose faith in competition is as hollow as our oligarchs’ support for our democratic republic.