Do Federal Lawmakers Have the Stomach to Rein in Big Tech?

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Two U.S. senators chat with a technology company in a wood-paneled room at the U.S. Capitol.
Sen. Amy Klobuchar, D-Minnesota (right), chair of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights, and ranking member Sen. Mike Lee, R-Utah, chat with Sheila Colclasure, global chief digital responsibility and public policy officer at IPG Kinesso, at the conclusion of a hearing on big data on Sept. 21, 2021, in Washington, D.C. (Ting Shen-Pool/Getty Images)

More than a dozen antitrust bills targeting Big Tech are currently in play in the nation’s capital, and Silicon Valley has mounted a full-court press to kill or soften the legislative onslaught.

The bills could make it more difficult for large tech companies to, among other things, acquire smaller companies, use their platforms to unduly boost their own products, and wield their huge cash stockpiles to dominate multiple, additional industries.

The main companies in the sights of federal lawmakers include Amazon, Apple, Google and Meta, the latter three of which are headquartered in the Bay Area. All four have become multibillion-dollar giants of advertising through buying and selling consumer data, while also variously dominating other industries like retail, apps and entertainment.

Federal lawmakers on both sides of the aisle have historically taken a relatively light touch toward regulating the technology industry. But that hands-off approach has recently shifted among a growing number of Democrats, and even some Republicans, as the power and size of these companies has grown exponentially.

"You have companies like Google that have 90% control over search engines," Sen. Amy Klobuchar, D-Minnesota, told CNN last year. "What I'm proposing is, make sure [federal agencies like the Federal Trade Commission] are able to take on trillion-dollar companies like Facebook and Google. They can't do it with Band-Aids and duct tape."

She added, "We must have laws that are as sophisticated as the companies we're dealing with."

Sponsored

In that vein, the slate of proposed legislation tackles a wide array of gray areas in the law to provide federal regulators with the resources — monetary and conceptual — to go after large companies. Here's a small sampling of the bills:

HR 3816 and S 2992: The American Choice and Innovation Online Act would bar platforms like Apple's App Store or Amazon's Marketplace from "self-preferencing," or giving their own products an unfair advantage over those of their competitors.

HR 3843 and S 228: The Merger Filing Fee Modernization Act of 2021 would increase the merger fees regulators collect from companies and use the additional amounts to fund aggressive enforcement of antitrust laws by the U.S. Department of Justice and the Federal Trade Commission.

S 3608: The Social Media NUDGE Act would direct the National Science Foundation and the National Academies of Sciences, Engineering and Medicine to study "content neutral" ways to address the algorithmic amplification of harmful content.

But despite high-drama hearings from whistleblowers like former Facebook lead product manager Frances Haugen, most of these bills have yet to make it out of their respective committees. It's entirely unclear how many will ever get a floor vote in the House or Senate.

Klobuchar, among the handful of lawmakers leading the antitrust charge, has acknowledged that the odds are daunting.

"We are up against a lot. ... The tech companies have 2,500 lobbyists and probably 10,000 lawyers," she said at a hearing of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights last December.

And most analysts agree that if Republicans regain the majority in Congress after this year's midterm elections, it’s game over for the biggest antitrust effort in generations.

Strong pushback

Tech industry proponents have presented a varied, and in some cases compelling, set of arguments against these legislative efforts.

Berin Szóka, president of TechFreedom, a tech-funded think tank in Washington, D.C., argues that the bills are rushed and poorly written. He decries the lack of traditional legislative hearings and markups before floor debate, even while acknowledging this practice has fallen out of vogue in recent years.

"We are legislating the way that that cartoon shows the railroad bridge being built out over the canyon as the train is going — except we don’t know what the train looks like or where it's going," he said.

Efforts by Democrats, like Klobuchar, to win support from key Republicans, he says, have resulted in bills full of ticking time bombs that could explode on Democrats and their allies the next time Republicans regain control of the White House.

For instance, Szóka argues, the same bill that would prevent tech titans from discriminating against competitors might also prevent them from removing companies from their app stores that have violated content rules, like Parler, a social media platform that has become a safe harbor for right-wing conspiracy theorists.

"It's going to be easy for these sites that cater to extremists to sue, to harass mainstream services, to rifle through emails, to depose executives," said Szóka.

Similar concerns have been expressed by many in California's congressional delegation, suggesting that Democrats could balk at supporting some of the bills.

Sens. Dianne Feinstein and Alex Padilla are among a large group of California Democrats who have criticized elements of the bills, mirroring some of the arguments made by tech-funded think tanks. Reps. Lou Correa, D-East LA; Ted Lieu, D-Torrance; Eric Swalwell, D-Castro Valley; Ro Khanna, D-Fremont; and Zoe Lofgren, D-San Jose also have raised concerns.

"I think they spent more time on the hearing than they did in writing the proposed legislation. Because it’s not well crafted and it was done in a hurry," Lofgren recently lamented about the American Choice and Innovation Online Act.

In an interview last month with Julia Angwin of The Markup, Rep. Khanna said breakups are certainly justified in some instances. "On Facebook, for example, where they've acquired Instagram and WhatsApp, you should have an unraveling of that company. I think you want to have a ban on mergers that are acquiring competitors."

But he cautioned about being "overly restrictive on all mergers," noting that mergers and acquisitions are a basic element of the U.S. economy.

The Washington Post recently reported that just seven large tech companies spent nearly $70 million lobbying the U.S. government in 2021.

"We are genuinely concerned that they could break a wide range of popular services we offer to our users, all the work we do to make our products safe, private and secure, and in some cases can hurt American competitiveness by disadvantaging solely U.S. companies," Google CEO Sundar Pichai said of the current bills during a recent earnings call.

And Lofgren and others who have voiced concerns with the current bills continue to take money from the likes of Amazon, Google, Meta and Microsoft, but say that doesn't influence their position.

Lofgren told KQED, "That’s obviously baloney, and if that were the case, Anna [Eshoo] and I wouldn’t have introduced our privacy bill, which would require a huge change in the business model of any company that relies on the data of its users."

The Online Privacy Act Lofgren reintroduced with fellow Silicon Valley Rep. Anna Eshoo is considered a serious threat to the personal data trading model that’s become the bread and butter for mega conglomerates. The legislation would require companies to protect users’ data, as well as establish a new federal agency to enforce privacy protections, and strengthen enforcement of privacy law violations.

Jennifer King, who follows data and privacy for the Stanford Institute for Human-Centered Artificial Intelligence, is not holding her breath for this Congress to act on any kind of revolutionary reform.

One big reason why: Both political parties, she notes, have grown quite fond of using targeted advertising themselves. "We now have a legislative structure that’s just as dependent on those data practices that the commercial structure is dependent on: behavioral targeting and marketing practices that are really at issue in all these cases," King said.

The one thing most lawmakers do seem to agree on is the need for some kind of new legislation, if only to bolster funding for federal regulators like those at the Federal Trade Commission. But what exactly that should look like is where the consensus falls apart.