​President Joe Biden’s administration has targeted Big Tech with several antitrust enforcement actions that could significantly impact consumers, but while many conservatives support the efforts, others fear they may stifle innovation.

Under Biden, the Department of Justice (DOJ) is presently engaged in a lawsuit against Google, the Federal Trade Commission (FTC) took Meta to court, and there is a possibility of a forthcoming lawsuit against Amazon, all over alleged antitrust violations stemming from industry monopolies. Some conservatives say this enforcement will increase competition, but others say the increase in government intervention in business will harm consumers while also reducing innovation.

“Generally, antitrust enforcement is intended to help consumers by deterring anticompetitive conduct that would lead to higher prices, lower quality service, and fewer choices for consumers,” Hudson Institute Senior Fellow and former FCC Commissioner Harold Furchtgott-Roth told the DCNF. “DOJ must explain to the judge how Google’s contracts for search engines harm consumers. Based on public information, I am not sure how DOJ makes that case.”

The DOJ originally filed an antitrust lawsuit against Google under the Trump administration, in October 2020, alleging the company used unlawful practices to maintain a monopoly in the search and search advertising markets. In particular, the lawsuit alleges that Google has abused its dominant market position to force its search engine as the default on web browsers.

“Google’s contracts ensure that rivals cannot match the search quality ad monetisation, especially on phones,” the DOJ alleges. “Through this feedback loop, this wheel has been turning for more than 12 years. It always turns to Google’s advantage.”

Though the Biden administration did not initiate antitrust cases against Facebook and Google, since Biden took office his administration has expanded antitrust enforcement against tech companies, with the FTC under Biden appointee Lina Khan suing Microsoft over its Activision acquisition and refiling a lawsuit against Facebook.

Biden has also made antitrust reform a key part of his economic platform, calling for passing “bipartisan legislation to strengthen antitrust enforcement and prevent big online platforms from giving their own products an unfair advantage” in his February State of the Union address.

Some economists argue, however, that this strategy disincentivizes innovation by creating greater regulatory friction for companies looking to expand. Moreover, experts question whether large tech companies’ market positions actually hurts consumers, as many of their products, such as Facebook and Google search, are free to use and provide numerous benefits. There are also many other search engines that are available to use.

“This administration has used [antitrust] to go after businesses based on subjective grounds,” Pelican Institute for Public Policy chief economist Vance Ginn told the DCNF. “The consequences … are a growing reliance on lawyers instead of expanding their businesses that people are choosing to use even with competitors in the search engine market. Doing so, the administration is making it more costly for new businesses to enter the market because of legal liability and dealing with a radical antitrust policy environment.”

Google referred the DCNF to a blog post titled, “People use Google because it’s helpful,” highlighting the quality of its product and the fact that it is free of charge. (RELATED: DAVIS: Why Conservatives Must Support The DOJ Against Google).

Despite these concerns, many Republicans and conservatives have joined with Biden in advocating for stronger antitrust enforcement and legislation targeting tech companies’ market dominance. Prominent GOP lawmakers including Iowa Sen. Chuck Grassley, Arkansas Sen. Tom Cotton and Colorado Rep. Ken Buck all backed legislation intended to target major tech companies.

Many conservatives also argue that stricter antitrust enforcement could ameliorate the problem of online censorship.

“Big Tech has had a stranglehold on the online marketplace of ideas for far too long,” founder and President of the Internet Accountability Project Mike Davis told the DCNF. “Consumers, especially those on the right, have had their opinions and voices silenced by the speech censors of Big Tech. Breaking up those behemoths will not only allow for more freedom of expression online, but it would allow a new era of discourse to flourish. Competition is important for all Americans, not just conservatives. Antitrust should be a nonpartisan issue as American as apple pie.”

Jake Denton, a research associate at the Heritage Foundation’s Tech Policy Center, asserts that government intervention is necessary to prevent this.

“The unchecked growth of Big Tech monopolies has gone on for too long,” Denton told the DCNF. “Silicon Valley giants like Google, Amazon, Facebook and Apple have been steadily acquiring emerging startups and growing competitors, consolidating their control over the tech sector … It is no longer tenable for regulators or our lawmakers to remain on the sidelines.”

The Biden administration has recently signaled its willingness to expand its crackdown on tech companies, with the FTC charging Amazon in June for allegedly having “duped millions of consumers into unknowingly enrolling in Amazon Prime,” according to its complaint. It also claims it takes at least six clicks to cancel a Prime membership.

“Consumers could lose out on popular features like Google Maps being at the top of search results, Amazon’s Prime program, or iPhones that come ready to use with basic apps out of the box,” Cato Institute Technology Policy Research Fellow Jennifer Huddleston told the DCNF.

“The shift towards a ‘big is bad’ mentality could penalize companies for developing features that make them more popular than competitors or otherwise improve their product” Huddleston told the DCNF.

The White House referred the DCNF to speeches and studies conducted by the administration asserting that antitrust enforcement boosts economic activity and competition.

The DOJ did not respond to the Daily Caller News Foundation’s request for comment. The FTC declined to comment.

Originally posted at Daily Caller.

The Biden Administration’s Justice Department took Google to a civil trial on Tuesday, beginning the department’s first major monopoly lawsuit since it took on Microsoft in 1998. What’s the allegation? Google supposedly violated U.S. antitrust laws. But it seems the main “violations” are that Google is good at what they do, consumers love their product and Microsoft is mad.

Jonathan Kantor at the Justice Department (and Lina Khan at the Federal Trade Commission) have pushed an endlessly fruitless crusade against “Big Tech.” Now, it has taken issue with Google’s methods of becoming the default browser on popular devices, which they’ve done through legal means that more savvy people might just call “marketing.”

​Products like iPhones and MacBooks make it easy for consumers to change their default browser to whatever they prefer. Most of them favor Google because they believe it’s a better search engine. 

Herein lies the real crux of the lawsuit. 

Antitrust laws were created to preserve competition. The original laws were rightly deemed too broad and vague, so a new guiding principle of the consumer welfare standard for enforcing these laws was implemented to consider whether consumers are better or worse off from the actions of businesses.

In economics, consumer welfare is defined as the “value consumers get from a product less the price they paid.” That value varies from person to person, which is what makes free markets work. Consumers have the ability and the sovereignty to decide which product or service is best for them. 

To violate the consumer welfare standard would mean moving toward a monopoly. 

This is when a business has a large market share, or even the market share, such that they can raise prices of their goods or services regardless of quality. The outcome would reduce consumer welfare and, therefore, contribute to potential antitrust law violations. Found guilty, a business could be broken up into smaller parts, forced to sell off part of it or face penalties. 

In other words, it’s another hindrance to productive activities as targeted employers are forced to beef up on lawyers to deal with federal pushback instead of allocating those resources toward productive means that would help their employees and customers prosper. 

Despite what the DOJ claims, antitrust laws are rarely enforced to protect consumer welfare, and this case is no exception. Google is not only Americans’ preferred browser, but the company is consistently rated one of the best places to work. So, it seems most of its consumers find value in the product. If they don’t, they can use Bing, Firefox, DuckDuckGo or any other search engine that competes with Google and is readily accessible. 

So, if this case isn’t centered around consumer welfare or targeting monopolies, what is it really about? 

If the DOJ wins, which is highly unlikely, American competition and innovation will be stifled. This rent-seeking behavior may win votes with folks on the Left concerned with restricted competition and those on the right concerned about censoring on popular platforms like Google and Meta, but at what cost?

Inhibiting free markets with increased regulations is far more likely to drive up prices and decrease consumer welfare than any part of “Big Tech.”

This pursuit wastes taxpayers’ dollars that would be better spent elsewhere or, better yet, for the federal government to spend less so people have more money in their pockets to improve their own welfare.

At a time when inflation remains too high, the labor market is cooling and Americans are suffering from a bleak economy, this lawsuit is a frustrating misuse of government resources.

Moreover, government attempts like this to manipulate markets will always fail due to what economist Friedrich Hayek identified as the knowledge problem. 

​He argued that information (knowledge) is decentralized, dispersed across society and not contained within departments of power. Central planners, in this case the DOJ (and FTC), do not have all the knowledge necessary to designate market competition, and they never will.

Free market capitalism cannot be manipulated but must be allowed to work through spontaneous order. This lawsuit attacks free markets and, thereby, free people. Not monopolies or consumer welfare violations, and it’s abundantly clear that neither of those are real problems regarding Google. 

​It’s time for the DOJ to accept defeat and focus on things that actually matter. Ganging up on Google amid all the problems Americans face today, while understanding legitimate concerns with some of Google’s actions, is out-of-touch, to say the least.

Originally published at Daily Caller. 

Today, I cover:

1) National:

• Shocking findings from the latest poverty report by the U.S. Census Bureau, including decreased real (inflation-adjusted) median household income and increased supplemental and child poverty rates.
• Median weekly real earnings have declined the most so far under Biden than any other president since 1980 except for Bush, Sr. No wonder many Americans feel pessimistic about the future. 
• New CPI report shows an elevated inflation rate. Prices are much higher now than when Biden became president.
• The combination of these indicates a weak economy from bad D.C. policies, as I recently explained at Econlib, and what to do about it.

2) States: Which states are seeking more tax reductions after lowering state income tax over the past three years?

​3) Other: My thoughts on the DOJ lawsuit against Google for violating antitrust laws and why I believe it's an attack on consumers and capitalism. 

​You can watch this TWE episode and others along with my Let People Prosper Show on YouTube or listen to it on Apple Podcast, Spotify, Google Podcast, or Anchor. Please share, subscribe, like, and leave a 5-star rating!
​
For show notes, thoughtful insights, media interviews, speeches, blog posts, research, and more, please check out my website (www.vanceginn.com) and subscribe to my newsletter (www.vanceginn.substack.com), share this post, and leave a comment.

​In this bonus episode, we discuss:
​
1) How immigration helps the U.S. economy and the truth behind common immigration myths, such as fear that immigrants "steal jobs,"
2) Why the tariffs against China didn't work, and the tyranny of excessive government spending; and
3) Dangers of antitrust laws, and the importance of letting markets work.

​Be sure to check out and subscribe to “The Immigration Guy” podcast.

You can watch this episode and others along with my Let People Prosper Show on YouTube or listen to it on Apple Podcast, Spotify, Google Podcast, or Anchor. Please share, subscribe, like, and leave a 5-star rating!

​For show notes, thoughtful insights, media interviews, speeches, blog posts, research, and more, check out my website (www.vanceginn.com) and please subscribe to my newsletter (www.vanceginn.substack.com), share this post, and leave a comment.

​We discuss:
​
1) How antitrust laws harm capitalism, why free markets work better with less government interference, and how people misunderstand antitrust laws;
2) What people, especially younger generations, misunderstand about capitalism, what it is and isn't, and how most of us on either side of the political aisle have more in common than not; and
3) How Hannah believes the country could change for the better, and her fascinating background from being a singer/songwriter and interning for Taylor Swift's team to becoming a liberty warrior.

​Hannah’s bio:

• Hannah Cox is a prominent libertarian writer, commentator, activist, and the Co-Founder of BASEDPolitics.
• Cox has an extensive resume that began with 5 years working in Nashville’s music industry, interning for Taylor Swift’s management, coordinating red carpets, and overseeing promotional campaigns.
• Her advocacy work began in 2013 when she served as a pro-bono policy advocate for the National Alliance on Mental Health in Tennessee and began working on the side for a gun-rights group at the same time. After witnessing the numerous ways the government was actively harming people, Cox decided to give up music for a career in public policy and activism and she hasn’t slowed down since.
• Cox went on to work for the Beacon Center of Tennessee as their Director of Outreach where she worked on both legislation and pro-bono economic litigation. Her efforts there contributed to the repeal of the state’s last income tax, the first school choice program in Tennessee, numerous criminal justice reforms, the repeal of multiple occupational licenses, property protections, the expansion of free market healthcare access (via the repeal of CON laws and protections for Direct Primary Care), and a campaign against corporate welfare.
• In 2018, Cox was tapped to serve as the National Manager of Conservatives Concerned About the Death Penalty. During her three years in this role, she overturned the death penalty in a state each year—always with Republican support for the bill.
• Cox launched her show BASED in 2020 during the pandemic with a passion for teaching people how to think, not what to think. She was convinced after her years of successfully passing legislation with the support of both Democrats and Republicans that Americans are not as far apart as we think. We merely have different solutions for the same problems, and that stems from the fact that we lack a common understanding of the root cause of those issues in the first place (usually government intervention).
• BASED immediately entered the top 1% of podcasts, launching Cox into her current role as a writer and commentator. In 2021, Cox partnered with her friend and colleague Brad Polumbo to expand the BASED brand into a full-fledged multimedia content hub where they use new media to continue driving real-world policy outcomes via education and awareness.
• She is a frequent guest on Fox News and Fox Business’ Kennedy program and her work is commonly cited by lawmakers and leaders across the political spectrum.

You can watch this episode and others along with my Let People Prosper Show on YouTube or listen to it on Apple Podcast, Spotify, Google Podcast, or Anchor. Please share, subscribe, like, and leave a 5-star rating!

For show notes, thoughtful insights, media interviews, speeches, blog posts, research, and more, please check out my website (www.vanceginn.com) and subscribe to my newsletter (www.vanceginn.substack.com), share this post, and leave a comment.

When was the last time you purchased something online? 

If you’re like many people, you’ve probably bought something online this week. And more than likely it was from Amazon though many other companies provide online shopping.

In fact, a recent survey found that one out of every four Americans buy items from Amazon at least once per week. 

If the Biden administration has its way, Amazon could fall victim to trust-busting by the antitrust radicals as the Federal Trade Commission (FTC) gears up to file a lawsuit that could break up the company. This would put a major damper on the satisfaction that so many people have with purchasing from Amazon.  

But there’s more to this perplexing story.

Despite recently trying—yet failing—to stop Microsoft from acquiring Activision, the FTC’s Chair Lina Khan and Assistant Attorney General Jonathan Kanter of the Department of Justice’s antitrust division are doubling down on the administration’s aggressive approach to antitrust enforcement. 

Americans are rightfully concerned about these radical moves. 

In my recent co-authored paper, we note how antitrust laws were designed to protect consumers and promote fair competition but rarely achieve these goals due to over-politicization and centralized power. Inevitably, businesses become the antitrust enforcement targets, resulting in less economic growth, innovation, and job creation, leading to higher prices and hindered prosperity. 

In short, consumers and employers are hurt by antitrust overreach.  

Bureaucrats too often use antitrust laws to bully businesses in the name of political agendas or vote-seeking initiatives, including empowering labor over management or breaking up successful companies based solely on their large size.  

This includes recent attempts to discourage “big tech” in the case of the trial against Microsoft.  

The erratic and changing nature of antitrust laws as power and agendas change leaves employers and innovators uncertain about the future thereby limiting their ability to plan profitable endeavors.

For example, determining what constitutes a "restraint of trade" under Section 1 of the Sherman Act, the first-ever antitrust statute, can be challenging. An overly broad interpretation of this phrase can lead to many unintended consequences.

Following complications in the Sherman Act, the U.S. Supreme Court recognized the consumer welfare standard that has set the precedent for at least the last 50 years, focusing on a simple question: do economic actions make consumers better or worse off? 

Protecting consumer welfare, which refers to the value consumers receive above the price they pay for goods and services, should be the driving force behind antitrust enforcement. This concept acknowledges that consumers have the sovereignty to make decisions that support the competitive market process. 

This has been the standard until recently. 

A much more activist group of antitrust scholars and practitioners have emerged as advocates for a radical transformation of antitrust enforcement. They largely reject the consumer welfare standard and make sweeping claims that failing to enforce antitrust laws has led to market concentration and wealth disparities, or even the flawed claim of “greed inflation.” 

But antitrust radicals diverge from the focus on promoting consumer welfare and safeguarding competition.  

Their main argument is that the consumer welfare standard has allowed concentration and enabled firms to limit output and charge higher prices. Moreover, they advocate that antitrust laws should protect various stakeholder groups, not just consumers, making the consumer welfare standard inadequate.  

However, evidence suggests the opposite.  

According to a study conducted by former FTC Commissioner Joshua Wright, there is no empirical basis to conclude that monopoly power is increasing. Other studies indicate that while markups may be rising, output has increased, and quality-adjusted prices have remained stable. 

The radical approach by Khan and Kanter to antitrust enforcement will not help consumers or the economy, no matter their intentions. We should remember the wise words by Milton Friedman: “One of the great mistakes is to judge policies and programs by their intentions rather than their results.”

The key to achieving greater opportunity and prosperity lies in reducing government interference and allowing competition, such as the gains provided by Amazon and Microsoft, to drive better results rather than expanding government. In fact, someone should be addressing the monopolies created by government across the economy, which have questionable at best increases in consumer welfare.

If the Biden administration’s proposed new guidelines for mergers go through or other expansions of antitrust enforcement, expect the already strained economy to endure extended suffering as innovation is stifled and consumers bear the brunt. And the satisfaction you get from shopping online may soon not be an option.

Originally published at Townall.

d​Everything old is new again, and that’s turning out to be true in the case of a growing drumbeat to use antitrust tools to rein in big technology companies like Apple, Amazon, Meta, and Google. But as a new policy report from the Pelican Institute points out, expanding the enforcement powers of antitrust agencies will do more harm than good—and an existing approach to protect consumers and producers, while encouraging innovation, is the better path forward.

​In their report “Antitrust & Enforcement: Letting Markets Work without Empowering Government,” Ted Bolema, Ph.D., J.D., Antitrust and Competition Fellow at the Innovators Network Foundation, and Vance Ginn, Ph.D., Chief Economist at the Pelican Institute, write that while the current frustrations with the size of large tech companies and censorship practices may be warranted, giving government enforcers and bureaucrats more power is not the answer. Instead, existing antitrust laws and the consumer welfare standard are still the best tools for protecting competition and consumers.

“For the last 50 years or so, scholars and courts have operated with a consensus about the goal of antitrust enforcement: the consumer welfare standard, which asks, ‘does the conduct in question make consumers better or worse off?’” Bolema and Ginn write. “Antitrust enforcement based on the consumer welfare standard protects one of the most important outcomes of the competitive market process and is worth preserving.”

Bolema and Ginn also note that calls to create new antitrust tools in response to conduct by “Big Tech” are misguided and will do far more to empower politicians and government bureaucrats than to prevent abusive conduct by technology companies.

“Expanding the enforcement powers of antitrust agencies — as many on the left and some on the right now wish to do — harkens back to an older ‘big is bad’ approach,” they write. “Rather than promoting competition, such a retrograde approach undercuts the competitive market process which provides more innovation, cheaper prices, and better-quality goods and services necessary for continued human flourishing.” Bolema and Ginn say that the consumer welfare standard—and putting power in the hands of consumers and producers— is the tried and true path to ensuring their best interests.

“As history has proven, empowering people in the marketplace rather than bureaucrats in government results in more efficient and effective outcomes and better supports liberty and prosperity,” Bolema and Ginn conclude.
You can read the full report, “Antitrust & Enforcement: Letting Markets Work without Empowering Government,” here.

Originally published by Pelican Institute.