The New Robber Barons
“You need strong antitrust laws as a democracy protection,” author, professor, and former gubernatorial candidate Zephyr Teachout told Mila during our recent interview. “People hate corporate monopolies, and it’s actually one of those areas where the people are way ahead of politicians in understanding the power structures in this country.”
Listen to our interview with Zephyr here!
Teachout is the recent author of Break ’Em Up: Recovering Our Freedom from Big Ag, Big Tech, and Big Money. It’s an eye-opening look at how the enforcement of antitrust laws has disintegrated in the US, and a call to action.
Check out this quick clip to learn why we stopped enforcing antitrust laws in the US.
“A monopoly is a private company that has governing power,” she explained. “The harm is not just about consumer prices. It’s about becoming a form of private government that’s sitting inside our democracy.”
Thanks to a full-scale assault on antitrust law by the Regan administration, monopolies have grown unimpeded for decades. Now, the most insidious monopolies in America are also responsible for your phone, computer, search results, shopping needs, and list of friends.
Facebook, Google, Amazon, and Apple have grown to genuinely gargantuan proportions in the last two decades. In so doing, they’ve become some of the biggest monopolies in American history. US Congressman David Cicilline, Chair of the House Judiciary Committee’s Subcommittee on Antitrust, gave a similar prognosis in an October report.
“Each platform now serves as a gatekeeper over a key channel of distribution,” he wrote. “By controlling access to markets, these giants can pick winners and losers throughout our economy.” Think of Amazon’s algorithm favoring its own products on the shopping site it owns, or Facebook’s push to pick which news stories and outlets get seen on its platform.
“They not only wield tremendous power, but they also abuse it by charging exorbitant fees, imposing oppressive contract terms, and extracting valuable data from the people and businesses that rely on them,” the report continues. “Second, each platform uses its gatekeeper position to maintain its market power.” Facebook’s continual purchasing of smaller competitors comes to mind.
These tech companies also wield tremendous power in the form of the raw data they collect from us. They aren’t shy about using it to get what they want, according to our former guest Shoshanna Zuboff.
“Surveillance capitalists discovered that the most predictive data come from actually intervening in your action and learning how to use all of this knowledge about you,” she told Mila earlier this year, “to come back to you with triggers and subliminal cues that can tune and herd your behavior in a way that optimizes their predictions.”
Although this may not look outwardly monopolistic, surveillance capitalism is incredibly dangerous because it gives these companies a tremendous amount of leverage over you, allowing them to deepen their use of monopolistic practices.
These new monopolies are less interested in raising prices on certain items than they are in exerting control. When it becomes impossible to find your friends without Facebook, order books without Amazon, talk on the phone without Apple, or surf the web without Google, those companies have a monopoly, whether product prices are higher or not.
“By controlling the infrastructure of the digital age, they have surveilled other businesses to identify potential rivals, and have ultimately bought out, copied, or cut off their competitive threats,” Cicilline concluded. “Whether through self-preferencing, predatory pricing, or exclusionary conduct, the dominant platforms have exploited their power in order to become even more dominant.”
These monopolies are using their power more and more overtly. Facebook blocked thousands of Biden’s ads days before the election, overcharged him for other ads, and allowed Trump to run ads like this. Apple settled this week for more than $110M after slowing iPhones to hide battery problems. Google routinely uses its own search engine to promote itself.
Since Cillicine’s report and our conversation with Teachout, the DOJ filed a necessary antitrust lawsuit against Google, which could set off a flurry of similar suits. The DOJ isn’t enacting a new law or regulation. It’s merely enforcing existing law — something no one has done since Regan.
“This is a feudal form of government that is spreading across all these different industries,” Teachout noted. “The good news is, once you see this not as a technological feat, but as an old monopoly business model that keeps rearing its head every 30 or 40 years, you actually can feel a lot more power over it because we can ban these kinds of structures and we have in the past.”
According to Teachout, antitrust was once an integral part of American progressivism, and antitrust leagues abounded here. Returning to these roots and pressuring lawmakers to break up dangerous monopolies could quickly make a difference.
Even better, America already has good antitrust statutes. They only need to be enforced. A vigilant FTC chair could use existing laws to break up Google, Amazon, and Facebook — all without a single new piece of legislation.
“Right now, it’s as if there’s effectively no speed limit on the highway,” she said in regards to FTC regulations on mergers and antitrust. “You put in 65 MPH speed limits, and it would transform merger policy.”
We can break up the corporate monopolies that increasingly govern our lives — all it takes is political willpower and an informed, engaged populace.
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