Last Week’s Big Tech Antitrust Hearings Sent An Unmistakable Message: Change Is In The Air For America’s Corporate Giants
The committee signaled an unprecedented desire to break with one of the most durable, and damaging, economic frameworks of the last 50 years: the 1970s-era, hands-off antitrust ideology that helped bestow these titans of tech with such extraordinary power to begin with.
This piece is a commentary, part of The Appeal’s collection of opinion and analysis.
Last week, House Antitrust Subcommittee chairman David Cicilline closed out a historic investigation into the power of Big Tech with the words of the great legal thinker and former Supreme Court Justice Louis Brandeis: “We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.” House Judiciary Committee chairman Jerry Nadler also summoned Brandeis at the same hearing: “I have long believed,” he said, “with Thomas Jefferson and Louis Brandeis, that concentration of power in any form—especially concentration of economic or political power—is dangerous to a democratic society.”
To most people, these statements, and the subcommittee’s five-and-a-half-hour interrogation of Amazon, Apple, Facebook, and Google’s CEOs, might not have seemed particularly momentous. But to anyone interested in curbing the might of America’s corporate giants, they sent an unmistakable message that something is changing. Through the evocation of Brandeis and members’ reassertion of authority over powerful corporations, the committee signaled an unprecedented desire to break with one of the most durable, and damaging, economic frameworks of the last 50 years: the 1970s-era, hands-off antitrust ideology that displaced Brandeis’ approach and helped bestow these titans of tech with such extraordinary power to begin with.
That ideology is rooted in enforcing antitrust laws according to the “consumer welfare” standard; according to this standard, virtually any consolidation of corporate power is acceptable as long as it might reasonably be predicted to lower prices and benefit consumers. The consumer welfare standard was developed and popularized by the conservative legal scholar Robert Bork in the 1960s and 1970s. Though best known for his hard-right social views and his unsuccessful nomination to the Supreme Court during the Reagan Administration, Bork’s most lasting legacy may be the way he helped reorient progressives and conservatives alike away from constraining corporate power.
Bork successfully insisted, with dubious evidence, that antitrust law’s only goal should be promoting “consumer welfare,” waving away or belittling concerns about unchecked corporate power’s harms to workers, independent businesses, and democracy—so much so that his students jokingly called his approach “protrust.” At the same time that Bork sought to subvert antitrust law to serve the powerful, he openly objected to the Civil Rights Act, arguing that it comprised an infringement on business and lamenting the “cost in freedom that must be paid for such legislation.”
Bork’s crusade was eagerly adopted by the Reagan administration. Progressives might have been expected to push back. Yet while they rejected Bork’s views on civil rights, they joined the Reaganites in embracing his framework on corporate power. This shift overthrew the approach to antitrust that Louis Brandeis and his Congressional allies had ushered into law and policy during the New Deal, which was predicated on clear, bright line rules for structuring markets to protect businesses, workers, and democracy.
Forty years later, the destruction that Bork’s policy experiment has wrought is clear. Corporate concentration is now extreme and contributing to a broad range of economic and social ills. One recent study found that the median family is $5,000 poorer, through higher prices and lower wages, because of systemic monopolization. But an increasingly diverse set of organizations and voices, well beyond the cloistered set of academics, big law partners, and judges who have quietly held court for the better part of 40 years, is joining the policy debate. Progressives should celebrate this shift, and work to deepen it. The extent of these efforts will help determine how quickly Congress and — under a potential Biden administration — the executive branch will turn away from acting within the anti-democratic framework of Bork’s ideology. And if policymakers are to succeed in rebuilding the post-COVID economy to be just, innovative, and conducive to a strong, inclusive democracy, antitrust has a foundational role to play.
That means having an open conversation about whether progressive enforcers should continue to respect Bork’s framework for antitrust as legitimate and compatible with economic justice and a secure democracy. Bork’s remaking of antitrust law was not distinct from his tolerance of racist, sexist, or homophobic discrimination. Both in the political and the economic sphere, his formulation is based on an understanding that the law should let the powerful use their power to oppress, and then call it freedom.
It’s not a coincidence that Bork’s ideological descendants are mobilizing as the debate over antitrust spills out of its traditional confines. Just hours after Nadler and Cicilline invoked Brandeis in the hearing room, a right wing consortium of organizations, including ALEC and FreedomWorks, launched an “Alliance on Antitrust” to “address the increasing calls to move away from the consumer welfare standard” and protect this ”neutral underlying principle” of antitrust law.
Progressives wouldn’t listen to Bork on civil rights or women’s rights, nor would they take orders from ALEC on virtually any policy question. But as surprising as it sounds, among progressive antitrust professionals, the point of antitrust law still should be to maximize “consumer welfare,” perhaps just better than policymakers have done in the past. Just last week, in fact, the leader of the Democratic-leaning American Antitrust Institute said, “We have been at the forefront of advocating for the most flexible, fulsome enforcement of the consumer welfare standard which has not been enforced in that way for the last 40 years.”
The divide between progressive consumer welfare acolytes and Brandeis-influenced advocates comes down to power. Those who follow Bork’s consumer welfare approach will accept powerful corporations if economists can make a convincing case that they will result in (easily gamed, often demonstrably inaccurate) predictions of lower prices, better quality, or a more innovative product. (A federal judge’s ruling on T-Mobile’s recent acquisition of Sprint might have put it best: the current approach, the judge wrote, “reduces [enforcement] to imprecise and somewhat suspect aids: competing crystal balls.”) Those of us who don’t subscribe to this view advocate for a return to clear, objective market share rules and an approach that decentralizes power to help protect not just consumers, but workers, small businesses, communities, and democracy itself from dominant corporations.
But this debate comes down to power in another way, too. Because of the consumer welfare standard’s reliance on price prediction and complex analyses, antitrust has been walled off by elite attorneys and highly credentialed economists, who make millions, even hundreds of millions, consulting for corporate clients after prestigious turns in government enforcement roles or while ensconced in academia. This isn’t a side effect of the consumer welfare standard; the cloistering of power into the hands of a small, “scientific” elite and away from democratic scrutiny or input was a central aim of Bork’s ideological revolution.
An aggressive set of leaders in Congress, coupled with executive branch leadership willing to issue new guidelines and rules, could begin to reorient antitrust away from this failed experiment and towards an approach centered on decentralizing economic power in ways that benefit not just consumers, but workers, smaller businesses, communities, and democracy overall.
As Franklin D. Roosevelt said when he accepted the Democratic nomination in 1936, “We stand committed to the proposition that freedom is no half-and-half affair. If the average citizen is guaranteed equal opportunity in the polling place, he must have equal opportunity in the marketplace.” In a time of similar peril and consequence, we should remember that Bork fought against equality in both of these realms, seeking to make America free for a small set of white men to dominate by enshrining racism, sexism, and corporate domination into law and policy. At long last, progressives should reject his vision in its entirety.
Sarah Miller is the Executive Director of the American Economic Liberties Project. Previously, she served as the Deputy Director of the Open Markets Institute, which was credited by Rolling Stone as “the driving force behind the resurgence in public understanding and desire for action around antitrust and monopolies.” She is also Co-Chair of Freedom From Facebook, a coalition of progressive groups that succeeded in bringing the concept of breaking up Facebook into the mainstream.