FTC Ponders New Antitrust, Consumer Protection Regulations

The Federal Trade Commission has begun a series of 15 to 20 hearings scheduled over the next few months to address whether companies based on new technologies should spur changes in its competition and consumer protection policies. FTC chair Joseph Simmons noted that the “broad antitrust consensus” in existence for 25 years is now being challenged, and that he will approach the topic with an open mind. The Justice Department may also start investigations into whether Google and other social media sites are biased against conservative voices.

The New York Times reports that, “the spotlight on the giants of Silicon Valley is a major shift for regulators in the United States,” which for years lauded these companies as “an emblem of American business leadership and ingenuity.” Under greater scrutiny “after a string of crises over privacy and misinformation on social media,” some of these tech companies have been lobbying for voluntary rules “and government officials have indicated their desire for light-touch regulation that would preempt some state laws.”

At the first FTC hearing, at the Georgetown University School of Law, antitrust lawyers with ties to the tech industry warned that, “changes could make decisions on mergers and antitrust enforcement vulnerable to politics.” Hogan Lovells attorney Janet McDavid, who was a panelist at the hearing, “said simply going after companies because they were big was dangerous.”

“It will be a slow moving ship, faster on privacy than on antitrust, but it’s an important moment,” said New Street senior advisor Blair Levin, a former FCC chief of staff. For the last 30 years, antitrust law has been focused “on whether prices increase when there is limited competition … [but] some academics and consumer groups have called for regulators to rethink that gauge.” That’s because two of the tech behemoths — Amazon and Google — “defy that metric of antitrust law because the companies are gaining power even as they offer cheap or free goods.”

At the FTC, Lina Khan, an assistant to a Democratic commissioner focuses her calls for change on Amazon, and Senator Bernie Sanders tweeted last week that, “Jeff Bezos is paying workers unlivable wages,” among other criticisms. (Amazon’s response was that it offers “stable pay and benefits.”)

Sanders is not alone in his belief that this “new economy” spurs increasing wage inequality; some Republicans and economists have joined the chorus. The latter are “focused on whether the concentration of workforces at companies like Amazon have a disproportionate effect on wages, inflation and growth.”