WASHINGTON — Sen. Elizabeth Warren (D-MA) rolled out the most ambitious policy plan of her presidential campaign — and arguably of any 2020 candidate — when she called for breaking up of the nation’s three tech giants: Facebook, Amazon and Google.
Amazon’s e-commerce sales made up almost half of all U.S. online spending last year. A staggering 70 percent of Internet traffic flowed through websites controlled by Facebook or Google. More than 67 percent of digital advertising revenues in 2018 went to Google, Facebook and Amazon. “Today’s big tech companies have too much power — too much power over our economy, our society and our democracy,” Warren wrote in a Medium post. “They’ve bulldozed competition, used our private information for profit and tilted the playing field against everyone else. And in the process, they have hurt small businesses and stifled innovation.”
In other words, these companies are monopolies. And like Standard Oil in the early 20th century and Microsoft two decades ago, Warren says, they need to be shrunk in size. (Facebook briefly took down ads on its platform bought by Warren’s campaign to promote her plan, citing a violation of company guidelines, but later backtracked.)
After years of neglect, the issues of antitrust and anti-monopoly are undergoing a renaissance. Warren is not the only 2020 contender to weigh in. Sen. Amy Klobuchar (D-MN), the top Democrat on the Senate antitrust subcommittee, has said America has “a major monopoly problem,” connecting the rise in drug prices and the recent tech privacy scandals to industry consolidation. Sen. Bernie Sanders (I-VT) is running for president once again on a platform that includes breaking up the nation’s largest banks.
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Rolling Stone can report that Warren, Klobuchar, former Secretary of Housing and Urban Development Julián Castro, Rep. Tim Ryan (D-OH) and ex-Congressman John Delaney will appear on Saturday, March 30th, at the Heartland Forum in Storm Lake, Iowa, to discuss America’s monopoly problem and other rural issues and offer solutions. (Every declared and likely Democratic candidate was invited, a spokesman for the event says.)
The event is sponsored by Open Markets Institute Action, HuffPost, the Storm Lake Times and the Iowa Farmers Union. Art Cullen, the Storm Lake Times’ Pulitzer Prize-winning columnist, will moderate, with questions from HuffPost journalists.
The driving force behind the event — and perhaps the larger resurgence in public understanding and desire for action around antitrust and monopolies — is Barry Lynn, the 57-year-old founder and director of the Open Markets Institute. For more than two decades, Lynn, the author of two books about America’s antitrust problem and the rise of monopolization, has been a lonely but powerful voice warning about the perils of the concentration of economic and political power. Vox called Lynn the “primary intellectual mover” behind renewed interest in antitrust policy. The New York Times reported that it’s “difficult to overstate” Lynn’s influence on these issues.
“I sometimes think of him like Captain America, frozen in a block of ice after World War II and returning to do battle with the values and rhetoric of another generation,” says Tim Wu, a Columbia law professor and most recently the author of The Curse of Bigness: Antitrust in the New Gilded Age. “He drives a lot of people crazy — often Democrats as much as Republicans — but I’d say he has created a lot of room for a much fuller debate than the pre-Lynn days. He has single-handedly widened the Overton window.”
Lynn’s outspokenness about the perils of mega-companies such as Google and Facebook hasn’t gone unnoticed. In 2017, Lynn and his small team were forced out of the center-left New America Foundation think tank after Lynn praised the European Union for slapping Google with a $2.7 billion fine for violating EU antitrust rules. Lynn said the think tank — which had received more than $20 million from Google — had caved to pressure from one of its biggest funders. (New America denied that Google influenced the decision, claiming that Lynn’s “repeated refusal to adhere to New America’s standards of openness and institutional collegiality meant that we could no longer work together as part of the same institution.”)
More recently, Facebook enlisted a Republican oppo research firm to target George Soros, a prominent critic of the company, and any ties he had to Freedom From Facebook, an offshoot of Open Markets that staged protests at Facebook’s yearly shareholder meeting and filed a complaint about the company with the Federal Trade Commission. (An OMI spokesman says Soros has never had any connection to Freedom From Facebook.)
Lynn and the rest of the Open Markets team operate out of a cramped WeWork office a few blocks from the White House. (They joke about when the day will come that they’ll have to scrutinize their own building manager.) The organization investigates monopolization and market consolidation in dozens of sectors across the economy, from farming and beer to home improvement stores, baby formula and porn websites. (According to OMI, Luxembourg-based MindGeek controls 70 percent of the U.S. online porn business.) It files friend-of-the-court briefs and complaints with federal regulators, organizes conferences and publishes op-eds and stories at a rapid clip.
The group has been critical of both the Obama and Trump administrations. A recent New York Times op-ed by two OMI staffers slammed the Justice Department’s current head of antitrust, Makan Delrahim, as a “champion” and “friend” of big tech. Lynn and his team have conducted dozens of briefings for members of Congress and Hill staffers on both sides of the aisle.
In one of several recent interviews with Rolling Stone, Lynn says his eyes were first opened to the issues of monopoly and market concentration more than two decades ago. After a stint at the Associated Press, Lynn, who worked for years as a journalist and still cultivates a trust-busting muckraker’s persona, edited a glossy business magazine aimed at executives trying to navigate the new global economy after the creation of the World Trade Organization and the passage of NAFTA.
One company in Taiwan, Lynn recalls, was the world’s leading manufacturer of semiconductor chips that went into everything from personal computers to planes to cars. An earthquake shut down the airport on the island, nearly causing a global crisis because those chips, essential to products around the world, couldn’t get out of Taiwan. “Globalization was supposed to be more of everything, every place, and yet here all of something really important [semiconductor chips] is at one place,” he says. “How can you do that? That led me to start knocking on doors in this town and around the country just to figure out what was going on.”
While writing his first book, End of the Line, Lynn says he discovered that international trade wasn’t to blame. Instead, it was competition policy that had been rewritten by a generation of conservative legal minds for the benefit of big companies. He wrote a second book, Cornered, in 2010, about how the policies of the Reagan and Clinton administrations had paved the way for monopolies across various sectors of the American economy, and received a small grant to devote himself full-time to monopolies and market consolidation.
“In some ways, Barry has kept alive a dead language, and it’s a language that takes time to study in order to deploy it in a way that’s safe and responsible,” says Sarah Miller, a former Treasury Department policy adviser under President Obama who is now the deputy director at Open Markets. “That knowledge is not really held anywhere else that I’m aware of to the same degree of nuance and care.”
The collapse of Lehman Brothers and the 2008 financial crash showed in the starkest of ways the crisis of too-big-to-fail financial institutions. Lynn says the Tea Party, in its earliest form, and the Occupy protests were in part Americans voicing their anger over an economy controlled by a few mega-companies. “The American people have known for a long time that we have a monopoly problem,” he says. “We just haven’t known what to call it.”
He credits a December 2012 column by Nobel Prize-winning economist Paul Krugman for elevating the issue. Krugman cited work done by Lynn and Open Markets colleague Phil Longman for “persuasively” arguing that corporate power was “an important factor in stagnating demand for labor, as corporations use their growing monopoly power to raise prices without passing the gains on to their employees.” He also praises a June 2016 speech by Warren at an Open Markets event for making the point that too-big-to-fail wasn’t confined to just the financial industry. Lynn says Warren’s speech “was heard in every single office on Capitol Hill, it was heard across Silicon Valley, it was heard all across Wall Street.”
The irony of Lynn’s ouster from New America in 2016 was that it, too, acted as a catalyst for the burgeoning anti-monopoly movement. “That event, better than anything we could write, told a very clear story about how monopolies can influence the public discourse and corrupt the public discourse in ways that preference them and harm others,” Miller says. The group spun off into its own standalone organization, the Open Markets Institute, now with a dozen staff.
Rep. David Cicilline (D-RI), who chairs the House’s antitrust subcommittee, says one of Lynn’s key points is that it was no accident how we got to a point where a small handful of mega-companies dominate some of the country’s biggest industries. “This didn’t just happen on its own,” Cicilline tells Rolling Stone. “This consolidation came about as part of policy choices and decisions that were made. We can, in the same way, make different choices and undo some of this concentration.”
In the past, Cicilline says, the antitrust subcommittee was often one of the last assignments to fill up within the broader House Judiciary Committee. This year, there were more people who wanted to be on it than there were spots. Rep. Alexandria Ocasio-Cortez (D-NY) has spoken forcefully about the corrosive effects of monopolization on journalism and democracy, and joined the campaign to convince Amazon to reverse its plan to put a new headquarters in Queens. She and Sen. Ed Markey (D-MA) also included a section near the end of their Green New Deal resolution about “ensuring a commercial environment where every businessperson is free from unfair competition and domination by domestic or international monopolies.”
Lynn says he appreciates that antitrust was included in the Green New Deal discussion, but in his view, it can’t be just a single line item. “If you want the health care system to really function, if you want to actually take on the hydrocarbon system, if want to achieve all these goals, what you have to do is take anti-monopolism from the back and put it in the beginning,” he says. “It’s not a bucket of policies that applies to certain areas of the economy. It’s the philosophy that guides your decision-making throughout the entire economy.”