Jandos Rothstein
In early 2019, I had the privilege of presenting my ideas on regulating tech platforms to several staff members on the Senate Judiciary Antitrust Subcommittee. I told the staffers that I was worried about whether antitrust, which can address certain anti-competitive conduct by the platforms, could be counted on to police the misappropriation of data from third-party content providers, or the “self-preferencing” of their own brands or applications to their hundreds of millions of users. I recommended sector-specific regulation to address this conduct, as have other important voices, from Public Knowledge to the Stigler Center.
I also presented my ideas at the Federal Trade Commission’s platform competition hearings in October 2018. Both there and at the Antitrust Subcommittee, I was called back for private briefings with staffers.
Nothing ever came of my ideas. I figured getting legislation passed would be a long shot, but I also thought my ideas were good and necessary, given the way the platforms exploit gaps in our consumer-oriented and price-fixated antitrust laws.
Flash forward to the summer of 2020. Through a LinkedIn email, I learned that a recent staffer on the Senate Judiciary Antitrust Subcommittee was recruited by Amazon’s public-policy arm this month. I took to Twitter to express my dismay, and quickly learned that another staffer on the Senate Judiciary Committee was recruited by Facebook’s competition policy arm in May 2020.
These two staffers are now working for the tech platforms, and presumably against my ideas, after having heard my ideas in a private setting.
It is important to note right here that I have no beef with these fine folks. Indeed, given the substantial time I invested twisting their arms in support of platform regulation, I have no reason to think they were acting in bad faith or that their actions (or lack thereof) were affected by these offers. My beef is with the process, and the way the platforms—by offering jobs to government officials tasked with regulating the platforms—are interfering with democracy.
To understand how, let’s start with a clear-cut hypothetical: Would we ever allow a defendant to make a job offer to a member of the jury? If the juror believed that she could curry favor with the defendant by voting to acquit, the job offer—or even the prospect of an offer—could create a conflict. For the same reason, we wouldn’t allow a defendant to threaten a juror, for fear that the threat could taint the outcome of a trial. (The same logic applies to a plaintiff.)
Let’s try another thought experiment: Should a target of an ongoing antitrust investigation by the Federal Trade Commission (FTC) or Department of Justice’s Antitrust Division (ATR) be permitted to hire away key staffers on the investigation team? Or should the target be permitted to fund a position at an academic center that recruits the staffer? These also seem problematic, as the prospect of an offer by the target could induce the staffer to modify his investigation or recommendations in favor of not pursuing an antitrust complaint.
One final experiment: Would we permit the target of a congressional inquiry on monopoly (and monopsony) abuses by dominant platforms to hire away key staffers on congressional committees tasked with investigating the platforms? This is also problematic, as the prospect of a job offer could induce a staffer to refrain from recommending to her representative or senator that the platform should be subjected to new regulations.
The optimal policies here are complicated by the fact that policy staffers have developed specialized skills, about both the industry and antitrust generally as well as the lobbying process, that could be valuable to the platforms under investigation. Denying such mobility into the private sector with a complete ban on recruitment would deprive the staffer of reaping the fruits of his or her labor.
But there’s a strong public-interest motive to deny this free exercise of movement from government to the corporate sector if it conflicts with proper corporate regulation. And that appears to be what’s happening.
NOTWITHSTANDING ITS dull content, LinkedIn has a nifty tool that allows searches for people who currently work in one place and previously worked somewhere else. For example, type in “Department of Justice Antitrust Division Amazon,” and you get back 65-odd results. (Results may vary slightly based on who conducts the search and where the search is performed.) Click the “all filters” drop-down, and choose Amazon as the current company. The results are narrowed to eight employees. A similar search reveals 10 and 11 current employees at Google and Facebook, respectively. The table below reports the number of people currently employed at Amazon, Google, or Facebook based on these queries.
In several instances, the same worker can be represented multiple times in the table—for example, if she worked at two (or more) government agencies before moving to the platform. It is possible that LinkedIn is generating “matches” that are close but not equal to the search terms. It bears noting that in many of these cases, the worker held a stint at a different employer before moving on to the platform. The table is meant to be illustrative and hopefully replicable.
When the keyword “antitrust,” or in the case of DOJ, the keywords “antitrust division” are removed from the initial query, the results are unsurprisingly larger. To restrict the results for DOJ and FTC, I impose a second filter for prior employer.
According to LinkedIn, 41 current Amazon employees previously worked at DOJ; 54 current Google employees previously worked at DOJ; and 48 current Facebook employees previously worked at DOJ. Without some benchmark or standard, it is hard to judge whether these numbers are intolerably high. But there is no doubt that the two recent episodes of poaching mentioned above are not outliers. Instead, they appear to be part of a larger pattern by the platforms of poaching government officials in the agencies and congressional committees that have jurisdiction over them.
That this stealthy form of influence peddling happens all over government—read Jessie Eisinger’s The Chickenshit Club to learn about the corruption in financial services—doesn’t mean it is not insidious here.
The platforms are in the crosshairs of multiple investigations, including by DOJ, state attorneys general, and the House Judiciary Committee. Amazon, Facebook, and Google picking off staffers charged with overseeing them erodes public trust in these institutions, and potentially undermines the investigations, to the extent it influences the conduct of the staff.
Other costs of permitting such poaching are less obvious. For example, knowing that she could be courted by a platform with deep pockets might encourage a staffer to develop certain skills or seek out positions that maximize the chances of being courted. She’s taking the job in the hopes of getting scooped up to take another job, in other words. Poaching a government official is similar to a “killer acquisition”: Staffers are acquired precisely to undermine potential oversight.
The revolving door could also affect government procurement, to the detriment of smaller rivals and to the benefit of Big Tech. In November 2016, Amazon hired the former chief acquisition offer of the General Services Administration (GSA) in the Obama administration. During 2017, Amazon reportedly privately advised the GSA on the launch of a new digital portal for government purchasing of commercial items and office supplies. Some rivals complained that as written, the bid would favor Amazon. After maintaining that the project was on hold because of the pandemic, in June GSA abruptly announced that Amazon, alongside Overstock and Fisher Scientific, won the bid. All three winners have their own private labels, which could disadvantage independent sellers.
IN FAIRNESS, the House Subcommittee on Antitrust is holding a hearing on July 27 to examine the dominance of tech platforms, and it plans to issue recommendations soon. And Sen. Elizabeth Warren (D-MA) has outlined several policy ideas, including breaking up Big Tech. But nothing today prevents Amazon or Google or Facebook from buying off entire antitrust agencies and congressional committees. I don’t begrudge any individual staffer who jumps at the offer. The point is that if we allow such offers without any guardrails, some people will end up taking them. That it happens so frequently is an indicator that we must reform the poaching process—but how?
There’s a strong public-interest motive to deny this free exercise of movement from government to the corporate sector if it conflicts with proper corporate regulation.
Let’s begin by paying government officials more, to narrow the income difference between keeping your government job and jumping ship. Additionally, we could offer government officials job security and suitable pensions, so making a career out of public service is not seen as an inferior alternative to the private sector. In The Chickenshit Club, Eisinger explains that SEC officials are reluctant to bring cases because of a challenging legal environment; the same can be said for antitrust. A more radical idea would be to offer bonuses to agency officials (or maybe just division heads) based on judgments or jury awards against a platform, as a means to incentivize them to bring riskier cases.
Sen. Warren has a policy piece on point—of course she does—titled “End Washington Corruption,” which calls for longer “cooling off” periods for former government officials. Current law mandates a period of one year before former senior government officials work on projects that they worked on in government. Warren’s plan would restrict the ability of corporate lobbyists to enter government jobs for six years, and would ban companies from hiring former senior government officials for at least four years.
What’s not clear is whether the four-year ban pertains only to full-time hires—that is, whether companies may hire former senior government officials indirectly (by the hour) via law firms or lobbying firms. If that’s the case, then an agency head could still deliver huge benefits to former or would-be clients via nonenforcement (or other means) and then be rewarded via future payments as billable hours. And we’re right back to the underenforcement problem.
Every day that passes in which Congress fails to deliver protections for independent merchants and content creators is a victory for the platforms. Regardless of its potential gaps, Sen. Warren’s anti-corruption plan is a good start. We might not get platform regulation until we address the revolving door in Washington.
The views expressed here are those of the author, and do not represent the views of his employers. Singer does not currently work for or against Amazon, Google, or Facebook in any pending litigation or consulting matter.
