Welcome to The Corner. In this issue, we discuss our statement on Amazon’s and Google’s shutdown of Parler and whether Merrick Garland will be the scourge of private monopoly.

To read previous editions of The Corner, click here.

Open Markets Statement on Amazon and Google’s Shutdown of Parler

On Wednesday, Open Markets issued a statement demanding that Congress move immediately to protect American democracy by breaking the power of Amazon, Google, and Facebook, and by enacting clear public rules to govern online discourse. In the statement, Open Markets makes clear that during a political emergency such as Americans witnessed last week, it can be necessary to regulate some communications for a short time. But Open Markets also states that the American people must never allow a handful of corporate bosses who control essential communications infrastructure to dictate the boundaries of free speech. 

To read the full statement - titled “To Protect Democracy, Lawmakers Must Fix Big Tech’s Socially Destructive Business Model” - click here.

Will Merrick Garland Be the Scourge of Private Monopoly? His Writings say“Yes.”

Few members of the new Biden Administration will have a bigger chance than Merrick Garland to address America’s monopoly crisis. If he chooses, the president-elect’s nominee for Attorney General can begin the task of establishing a rule of law designed to address the most pressing - even existential - economic and political challenges of the 21st Century.

Garland can, for instance, immediately toss out the pro-monopoly “consumer welfare” philosophy adopted by Reagan Administration almost 40 years ago, and restore the approach followed by Democrats from Woodrow Wilson through Jimmy Carter. He can also move to transform the Justice Department’s new antitrust case against Google into a full-scale effort to restructure the entire digital economy to all but eliminate the most dangerous powers of Google, Facebook, and Amazon. And he will have the opportunity to bring vanguard cases that demonstrate how antimonopoly law can improve the welfare of powerless workers, contractors, and small entrepreneurs.

Garland’s antitrust record as a judge on the U.S. Court of Appeals for the District of Columbia Circuit is short, and has been described as “neither pro-plaintiff nor pro-defendant.” But there’s good reason to hope that Garland - who in 2016 was nominated by President Obama to serve on the Supreme Court, but was then not confirmed by the Senate - will prove to be the attorney general for this moment. 

Perhaps the simplest reason for hope is that the 68-year-old Garland completed his law studies before the revolution in antitrust thinking and enforcement launched by Ronald Reagan in 1981. Garland then taught antitrust at Harvard in the mid-1980s, at a time when the radical pro-monopoly thinking of professors Robert Bork and Richard Posner was still under being debated. 

Indeed, it was during this period that Garland published a powerful article in 1987, “Antitrust and State Action: Economic Efficiency and the Political Process.” In it, Garland strongly attacked efforts by scholars and judges including Bork, Posner, and Frank Easterbrook to apply certain efficiency arguments to the enforcement of competition law, including by individual states. In the article, Garland charges that their “efficiency test” essentially amounts to an “assault on democratic politics.” 

In his time on the circuit court, Garland had few opportunities to review antitrust cases, and his record is mixed. In 2001, he supported an anti-merger decision that stopped a three-to-two merger in baby food, in FTC v. H.J. Heinz. But in 1999 he joined a decision dismissing an essential facility claim, in Thomas v. Network Solutions. And he joined a series of denials of class certification in rail freight fuel litigation that raised the bar for certifying class actions and weakened private antitrust enforcement.

But there should be no doubt that Garland understands the essential role democratic government must play in establishing the rules for competition among private parties. In a key passage in his 1987 paper, he wrote that the Supreme Court had made clear the need to “[prevent] the delegation to private parties of the power to restrain competition.” The essential goal must be to ensure that the state “retain[s] effective control over the regulation of its economy.”

This is a view that clearly puts Garland on a collision course with the now clearly demonstrated power of Amazon, Google, Facebook, and other platform monopolists to regulate speech, not only of private actors, but of public officials.

Open Markets Calls on DOJ to Block Google Takeover of Fitbit, and Condemns EU Decision

Just before the holidays, Open Markets issued a statement urging the U.S. DOJ to join Australia in rejecting Google’s merger conditions and to block Google’s takeover of Fitbit. Among other reasons, we said the deal would allow Google to acquire sensitive health information and “to use that data to discriminate in the provision of health insurance and health care and in the marketing of a vast variety of related goods and services.” In the statement, Open Markets also condemned the decision by EU Competition Commissioner Margrethe Vestager to approve the takeover.

🔊 ANTI-MONOPOLY RISING:

• Visa and Plaid have ended their $5.3 billion attempt at merging after the Department of Justice (DOJ) moved to block the deal, arguing that the acquisition by Visa represented an attempt to kill off a potential competitor to Visa’s debit card business. Open Markets’ policy analyst Daniel Hanley and researcher Garphil Julien wrote in December, in the American Banker, about why the DOJ should block this deal. (Pitchbook)
   

• The German Parliament this week voted to give Germany’s competition agency, the Bundeskartellamt, authority to reform their national competition law to better deal with the market power of big tech. The move will allow the agency to take preventative measures in dealing with firms that have the potential for anticompetitive conduct in markets that are not yet concentrated.  (Politico)

📝 WHAT WE'VE BEEN UP TO:

• Barry Lynn published a piece in the Washington Monthly detailing how President-Elect Biden can use existing antimonopoly power to fix many of the biggest political and economic challenges America faces today. Lynn’s piece was mentioned in The American Prospect, Trump Sports and in two other Washington Monthly stories.
  

• Sandeep Vaheesan published a piece in Dissent Magazine on gig workers and antitrust reform. “Instead of attempting to create an economists’ utopia of “perfect competition,” policymakers should reform antitrust to democratize power in the economy.”
  

• Sally Hubbard quoted in Bloomberg commenting on the DOJ case against Google. She was also quoted in Vox’s Recode, Business Insider, Wired, MIT Technology Review, Common Dreams, S&P Global, Raw Story, Yahoo! News, Slashdot. “The DOJ case is literally a clone of U.S. v. Microsoft and should be somewhat of a slam-dunk,” said Hubbard.
  

• Sandeep Vaheesan was mentioned by Zephyr Teachout in The New Republic for his thoughts on how to form a trust-busting Biden FTC. He was also mentioned in Brookings for similar comments about competition. “The first step is openly rejecting the Reagan philosophy, and instead embracing a structuralist approach, using bright-line rules to define and rein in monopoly concentration and looking at consolidation with suspicion.”
  

• Claire Kelloway was mentioned in Reason for opposing Biden’s choice of Vilsack for USDA. “Vilsack's "pro-corporate policies," which she says help "drive rural communities away from the Democratic Party.”
  

• Barry Lynn’s book, Liberty from All Masters, was included in ProMarket’s list of the best political economy books of 2020. “Taking inspiration from both Louis Brandeis and W.E.B. Du Bois, Liberty from All Masters attempts to disentangle monopoly from American capitalism and to propose a unified theory of American liberty. It is an ambitious project, and the end result is fascinating.”
  

• Barry Lynn was featured on The Rob Kall Bottom Up Radio Show Podcast and mentioned in Newsweek for detailing the impacts of neoliberal reactionaries on common carrier protections. “While Americans say they are concerned about liberty and personal privacy, many routinely disclose key personal information to major online companies, allowing them to develop targeted marketing plans based on location, education, income, occupation, age, race, sex—you name it.”
  

• Phil Longman was quoted in The Intercept highlighting that hospital monopolies have converted health care from a social good to a commodity. “Nominally nonprofit community-spirited institutions have actually come to operate as profit-maximizing monopolies with the excess going to executive compensation instead of dividends.”
  

• Johnny Ryan was quoted in Money Training Club criticizing digital privacy policies. “Apple and Brave are fighting this Gaulish little village fight against the Roman empire,” he told Business Insider.
  

• Barry Lynn was quoted in When the Abuser Goes to Work commenting on Bertelsmann’s plan to take control of Simon & Schuster. He said the proposed deal “poses multiple dangers to American democracy and to the interests of America’s authors and readers.”
  

• Open Markets Institute’s report on Amazon’s worker surveillance was referenced in the Financial Times. “It makes me afraid, physically and mentally exhausted,” Hibaq Mohamed, an Amazon warehouse worker, told researchers at the Open Markets Institute of the monitoring at work.
  

• Open Markets Institute was cited in the Cornell Law School Legal Information Institute in a piece about the AMG Capital Management, LLC v. FTC lawsuit for contending that the FTC’s remedial authority is essential for deterring unlawful activity. “FTC’s authority to request monetary awards not only rectifies the harms of FTC Act violations, but also deters other businesses from engaging in unlawful activity by demonstrating the consequences these businesses may face.”
  

• Open Markets Institute was mentioned by Anthony Pahnke’s commentary in the WCF Courier for documenting corporate concentration of the U.S. food system. “According to the Open Markets Institute, fewer and fewer corporations dominate the American food system from seed to plate. This not only subjects farmers to predatory pricing, but hurts consumers at the grocery aisle.”
  

• Open Markets Institute was mentioned in The Nation and Business Insider for demanding the FTC ban exclusionary contracts by dominant firms.
  

• Sandeep Vaheesan was a panelist on an American Bar Association event about equity and antitrust. “Recent public outcry has generated a deeper social recognition and understanding of the ways in which systemic racism has harmed and continues to harm people of color in the United States. As we continue to learn about and confront this legacy, we must also ask about the role of our laws and public institutions in redressing these harms.”We appreciate your readership. Please consider making a contribution to support the continued publication of this newsletter. 

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📈 VITAL STAT: $2.1 Billion

The amount office retailer Staples offered to buy competitor Office Depot. This is the third time that executives have attempted to merge the two corporations. In 2016, the Federal Trade Commission blocked the last attempt, arguing the deal would reduce competition.

📚 WHAT WE'RE READING:

• “Green Antitrust: Friendly Fire in the Fight against Climate Change”(University of Amsterdam, Maarten Pieter Schinkel, Leonard Treuren): Schinkel and Treuren argue that antitrust laws should not be weakened to allow for cooperation between firms in creating joint sustainability initiatives. The European Commission is considering how competition policy can support efforts at tackling climate change and promoting green energy technologies. Schinkel and Treuren make the case that competition between these firms would, rather, induce sustainability efforts by firms.

Barry Lynn’s New Book:

Liberty From All Masters

The New American Autocracy vs. The Will of the People

St. Martins Press will publish Open Markets Executive Director Barry Lynn’s new book, Liberty From All Masters, on September 29. The book is Barry’s first since Cornered, in 2010. In it, he details how Google, Amazon, and Facebook developed the ability to manipulate the flow of news, information, and business in America, and are transforming this power into autocratic systems of control. Barry then details how Americans over the course of two centuries built a “System of Liberty,” and shows how we Americans can put this system to work again today. Pre-order your copy here. 

Open Markets Employment Opportunities

You can find the full job listings here. 

🔎 TIPS? COMMENTS? SUGGESTIONS?

We would love to hear from you—just reply to this e-mail and drop us a line. Give us your feedback, alert us to competition policy news, or let us know your favorite story from this issue. 

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