Biden’s pro-competition agenda is tested by neutrality, tests

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US President Joe Biden delivers remarks before signing an executive order to “promote the competitiveness of the American economy” at an event in the State Dining Room of the White House in Washington US, July 9, 2021.

Joe Biden positioned himself as a competitive president, pleasing progressives by installing their wish list of liberal antitrust enforcers early in his administration.

But this fall, his digital competition agenda will be put to the test, as the first of the government’s tech anti-monopoly lawsuits is finally argued in federal court.

Tuesday marked a convergence of much-anticipated actions on competition policy and enforcement. First, the Federal Trade Commission announced its long-awaited antitrust suit against Amazon. Shortly after that, the chairman of the Federal Communications Commission announced a proposal to roll back net neutrality rules, which prohibit internet service providers from favoring certain websites over others.

At the same time, the Department of Justice filed its own monopolization case against Google in the Washington, DC District Court, three years after the first complaint was filed by the previous administration. The Justice Department’s second antitrust challenge against Google is set to go to trial early next year.

During Biden’s presidency, much ink has been spilled over his antitrust enforcers pushing the boundaries, particularly in their look at deals and potential misconduct in the technology industry. But until this month, none of the federal technology monopoly trials took off.

Before Democrat Anna Gomez was sworn in this week, the FCC was deadlocked, unable to proceed with any measures without the support of at least one of the Republican commissioners.

Antitrust and government rulemaking cases are notorious for their often long timelines. But with all these actions now in motion, Americans are one step closer to seeing how the Biden administration views the competition.

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Tim Wu, who previously served in the White House as a key architect of the Biden administration’s competitive agenda, said in an interview that many of the seeds planted early in the administration, if not yet bearing fruit, are at least “germinating.” .”

Wu said that in the early days of his time in the White House, the administration came up with what he called the “grand unified theory of antitrust revival.” This includes appointing strong enforcers and starting the White House Competition Council.

Biden laid out his competition goals in an executive order issued in 2021, urging the FCC to roll back net neutrality rules and for the FTC to “challenge the first bad merger, ” and other things.

Since the time of the executive order, Hannah Garden-Monheit, policy director of the Competition Council at the White House, said the principles have “built a lot of momentum” and “become embedded and institutionalized in the work of government.”

Although there are many prongs of competitive policy, the Biden administration is against the clock. As the 2024 presidential election approaches, the administration faces the possibility of losing the opportunity to follow through on some of the actions it spearheaded.

That timeline may be more about the ability to enforce and uphold net neutrality rules, as the FCC doesn’t have a Democratic majority that could move forward on rulemaking until this week. Wu and other net neutrality advocates blamed the telecom industry for opposing Biden’s initial FCC nominee, Gigi Sohn, who held onto her nomination for more than a year until she ultimately withdrew. (CNBC parent company NBCUniversal is owned by internet service provider Comcast.)

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Gigi Sohn testified at a Senate Commerce, Science, and Transportation Committee confirmation hearing examining her nomination to be appointed Commissioner of the Federal Communications Commission on February 9, 2022 in Washington, DC.

Biden’s reluctance to pivot to another candidate in the past also meant the FCC remained deadlocked for the first half of his term as president.

However, Wu said backing a qualified candidate “isn’t Biden’s style.”

Regardless of when the administration changes, Wu said he’s confident net neutrality can prevail. He called the rollback of rules under Trump’s FCC an “outlier” and believes Republicans have nothing to gain at this point by pushing for a rollback.

“I think about the Republicans — they don’t like Google, Facebook doing censorship — and they certainly don’t like their cable company doing this,” Wu said. “There is no current constituency for repealing net neutrality.”

At the FTC, Chair Lina Khan finally proceeded to file the agency’s antitrust suit against Amazon, accusing it of illegally maintaining a monopoly by punishing sellers who offer lower prices elsewhere and ” effectively” requiring them to use Amazon’s fulfillment services. Amazon’s general counsel called the case “false on the facts and the law.”

Federal Trade Commission Chair Lina Khan testifies before a House Judiciary Committee hearing on Oversight of the Federal Trade Commission, on Capitol Hill in Washington, DC, July 13, 2023.

“This complaint focuses on conduct that courts have previously found to be clear violations of the antitrust laws,” said Bill Baer, ​​who serves as the FTC and DOJ’s top antitrust officer. various Democratic administrations. “He need not incorporate theories where courts have not reached or where they have been particularly skeptical in the past.”

Wu said the narrower approach didn’t surprise him, in part because Khan was “more restrained than people thought he was.”

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“Frankly, it’s not exotic,” Wu said of Amazon’s complaint. “This is plain vanilla, Main Street, what we would call a consumer welfare case.”

While Khan and Jonathan Kanter, his counterpart at the DOJ, say they intend to bring cases that they can win, they have shown that they are also willing to bring risky complaints to push the boundaries of the law.

“They adopted more of a baseball approach than a perfectionist approach,” Wu said. “And when you have somebody batting .500, .700, that’s a good hitter, especially if they’re swinging for home runs.”

“This is a critical moment in the courts deciding how antitrust laws apply to Big Tech,” Baer said. “The results of these pending and future cases will tell us a lot about what the rules of the road are.”

Advocates of reforming antitrust laws say it’s important for Congress to clarify the law, but antitrust reform has stalled in Congress after a major push last year failed.

Wu said a key “incomplete part” of the White House’s grand master plan is appointing more judges to consider antitrust enforcement.

In 10 years, Garden-Monheit said she thinks Americans will look back on this moment “as a real turning point” where the president chose to turn the page on “40 years that laissez-faire, trickle-down economics, lax enforcement of antitrust. laws.”

“I hope that’s the direction we’ll continue to see in the decades ahead, just as we’ve turned the page on decades of previous failed approaches,” Garden-Monheit said.

“Win or lose, we don’t know what will happen in any of the cases,” Wu said. “But I think we’ll look back on it and say that non-implementation was a blip.”

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