The Need for Regulation

The Big Four tech companies are each so rich and powerful that market forces aren’t enough to rein them in—only the government can do it. And under the Biden administration, federal agencies have become more aggressive in their investigation of Big Tech for a range of anti-competitive practices. But it’s not enough. We’re calling on the FTC to step up its review of the Big Four’s actions in the auto industry — and to initiate rulemaking to prevent them from doing the kind of damage to the auto industry that they’ve already done in so many other sectors.

America counts on competition

The strength of the U.S. economy depends on competition. Competition is what enables new companies to gain a foothold, and large and stable companies to stay that way. Because it enables better ideas to win out over established ones, competition is the underpinning of innovation. And because it ensures that the economy remains broad as well as deep, competition supports jobs at every level, and communities of every size, across the country. It’s not an exaggeration to say that the competitiveness of our economy is the reason the U.S. has the world’s highest GDP.  

But market consolidation and increasing economic inequality have put all of this at risk.

In his 2021 Executive Order on Promoting Competition in the American Economy, President Biden renewed his commitment to maintaining a fair, open, and competitive marketplace, to protect workers, small businesses, and consumers. He noted that corporate consolidation has concentrated market power in the hands of a small number of enormous companies, and that the largest tech companies lock competitors out of the market and extract monopoly profits.

And he affirmed that it is his administration’s policy to use antitrust law and anti-monopoly regulations to “meet the challenges posed by new industries and technologies, including the rise of the dominant internet platforms.” As the President put it,  Americans “have to get back to an economy that grows from the bottom up and the middle out” — precisely the opposite of the situation that prevails in every industry where Big Tech throws its weight around.

The DOJ and FTC: America’s enforcers

Two federal agencies are primarily responsible for ensuring that companies that gain disproportionate market power and engage in monopolistic behavior are brought to heel.

The Department of Justice Antitrust Division is charged with enforcing the laws and regulations that ensure our economy remains competitive. They investigate reports of anticompetitive behavior in every industry, and prosecute violations of law and regulation through both civil and criminal actions. Under President Biden, the Antitrust Division has been litigating at the highest rate in decades, reviewing thousands of merger transactions and opening more than 150 grand jury investigations — along with six civil enforcement court cases, including a high-profile case against Google.

The Federal Trade Commission also investigates consumer protection violations, including violations of privacy protections, and takes enforcement action. But, just as importantly, it makes the rules. Over a hundred years ago, the FTC was delegated the power by Congress to establish the regulations that bring consumer protection statutes to life. And this is the area in which we are calling on the FTC to step up its activity. The current level of market consolidation makes clear that the existing body of laws and rules — not just in the internet industry, but across the economy — is not sufficient to keep gigantic companies in check. We need the FTC to use its power to rein in the problem.

The need for rulemaking

Section 5 of the FTC Act gives the FTC broad power to ban “unfair methods of competition, and to enforce against violations. In November 2022, the FTC issued a policy change expanding its definition of “unfair methods of competition,” committing the agency to aggressively police monopolistic behavior and to update its procedures to keep up with changes in the market, including the changes brought on by Big Tech corporate consolidation.

At Fight for the Future, we hail this new, more aggressive enforcement approach the FTC has committed to adopt. And we are calling on the FTC to apply its new enforcement standard to Big Tech. In particular, we need action that will roll back Big Tech’s increasing domination of the auto industry — and we need it now. We’ve petitioned the FTC to issue new rules and initiate new enforcement actions.

And we need your help to make it happen.