OpenMarket: Antitrust and Competition

Facebook co-founder Chris Hughes, former publisher of The New Republic, argues in a long essay for The New York Times that the company should be broken up and regulated, and indeed that this would be the “American” thing to do.

Facebook is reportedly negotiating a settlement with a powerful regulatory agency that would impose a new corporate structure, increase liability for one or more executives, and take aim at the company financially. Important protections for civil and economic rights are in jeopardy. The precedent could be catastrophic for the next person confronting a regulatory agency without the personal resources of Mark Zuckerberg.

Both parties are making antitrust regulation a 2020 campaign issue. Neither President Trump nor most of the Democratic candidates are proposing improvements. Over at the Washington Examiner I take a closer look.

Antitrust regulation is a complex, multifaceted issue. It brings together insights from law, economics, political science, history, philosophy, and other disciplines. Right now both political parties are ramping up their antitrust rhetoric, and it will likely be a live issue throughout the 2020 election cycle. A working understanding of how antitrust regulation works is important for understanding why it works so poorly, and should ultimately be abolished.

At a time when big tech companies are being attacked over bigness, privacy, elections, and the ordering of their news feeds, the Charles Koch Institute has some good news. While we all have plenty of complaints, Americans also have a lot of good things to say about the platforms, websites, and apps that they use every day.

In a bleak take on the sharing economy, Atlantic writer Alexis C. Madrigal says it has created a “servant economy,” where sharing economy platforms provide “low-paying work that deliver on-demand servant services to rich people.” He likens this to the domestic service prevalent before the Second World War. This take gets things almost completely backwards.

Facebook founder Mark Zuckerberg’s motto used to be “Move fast and break things.” Now that his company is under increased political scrutiny—and facing calls for breakup from both right and left—he has changed his tune to “move slowly and establish rules.”

At a time when socialism seems determined to crawl back from the dustbin of history, it can be a challenge defending the moral legitimacy—and humanity—of a capitalist economy. Efforts like that of my colleagues Fred Smith and Ryan Young are certainly welcome, as is new research from academics like Prof. James Otteson. It’s especially nice, however, to also see individual businesspeople telling their own stories of hard work and success.

With major political figures proposing the forced breakup of some of the nation’s most successful companies, the once-arcane field of antitrust law is now at the top of the national conversation. A new video from the Competitive Enterprise Institute walks viewers through the history of economic monopolies and trustbusting and exposes the flawed logic underlying most calls for antitrust enforcement.

Are Tucker Carlson’s predictions of Google taking over the future keeping you up at night? Sooth yourself with the creative destruction described in “Life after Google: The Fall of Big Data and the Rise of the Blockchain Economy” by George Gilder. The famous economist, writer, investor, and tech guru argues that Google’s days of aggregate and advertise success are numbered and goes into considerable depth about why.