When Antitrust Is Anti-Consumer
Biden’s appointment of Lina Khan to lead the FTC spells trouble for consumers.
Lina Khan, a noted proponent of expanding and altering U.S. antitrust law, was confirmed last week as a commissioner to the Federal Trade Commission. Mere hours later, President Biden promoted her to chair of the agency. Khan’s influence is already evident in the legislation introduced earlier this month in the House Judiciary Committee and will no doubt influence the work of the FTC. It’s a shame that consumers won’t benefit from her appointment.
Khan rose to prominence after writing an article in the Yale Law Journal, wherein she argued that current U.S. antitrust law is insufficient in patrolling bad actors in the new platform economy. She asserted that ownership of platforms confers an unfair advantage, as it allows such individuals to control the “essential infrastructure” on which competitors depend. Her concern is at the heart of two of the antitrust bills introduced in the House.
The “Ending Platform Monopolies Act,” sponsored by Representative Pramila Jayapal (D., Wash.), bans platform owners from competing with other companies that utilize their platform and authorizes federal agencies to break up companies that run afoul of those restrictions. Similarly, the “American Innovation and Choice Online Act,” sponsored by Representative David Cicilline (D., R.I.), outlaws firms’ preferencing their own products or services on their platform. Khan no doubt agrees that owning the platform — and competing with other firms via that platform — is problematic.
But what would instituting those restrictions mean for consumers?
In practice, preventing companies from excluding businesses from their platforms and advantaging platform owners’ other businesses would bring about a major degradation of services and conveniences. A letter from the left-leaning Chamber of Progress — which, it should be noted, benefits from Big Tech support — to Representative Cicilline offers some examples. Such instances include consumers not being able to use Alexa to order from Amazon, YouTube not being allowed to ban PornHub videos, Apple’s iPhone not being allowed to come with apps or the AppStore preinstalled, no free shipping for Prime customers on eligible products, Facebook not being able to remove Alex Jones’s Sandy Hook content, and Google being prohibited from displaying shopping results in its main search results.
This is the dead opposite of the consumer benefit that U.S. antitrust law currently aims to protect.
In her 2017 essay, Khan also pointed to platforms’ creating incentives for companies to favor growth over profits, which ostensibly makes predatory pricing rational. This, she argued, is another reason to overhaul U.S. antitrust law.
Read the full article at National Review.