Graeme Jennings/Pool via AP
Facebook CEO Mark Zuckerberg speaks via video conference during a House Judiciary subcommittee hearing on antitrust on Capitol Hill on Wednesday.
I’ve had occasion to read many transcripts of hearings in Congresses past, a time when Congress had the institutional resources and the personal gumption (in an age before the floodgates of Big Money opened) to challenge power. Hearings from the Truman Committee on wartime profiteering in the defense industry, or Emanuel Celler’s hearings on corporate consolidations in the 1950s, or the impeachment deliberations of everyone from Andrew Mellon to Richard Nixon showed a Congress in command that could actually make the titans of industry fearful.
You might have thought that those days have passed, that Congress was too deprived of expertise, too bought by special interests, too callow in the face of might to summon up that level of fire again. But when the CEOs of four of the largest tech companies in the world—Jeff Bezos of Amazon, Tim Cook of Apple, Mark Zuckerberg of Facebook, and Sundar Pichai of Google—called in remotely to the House Antitrust Subcommittee on Wednesday, that spirit returned.
We hear a lot that Congress is hopelessly dysfunctional. But all of the tribalism and structural inequities in the process, like members getting only five minutes at a time for questions, were present in this hearing, and it was still excellent. It’s amazing what a little evidence and a set of politicians committed to their job can do. And it raises the bar, both for the ability for Congress to conduct oversight, and for Washington to do something about the relentless power of Big Tech.
I did what I’ve been told is a 175-tweet thread of the blow-by-blow of the hearing, so I will forward you over there for more detail. But armed with the fruits of a yearlong investigation, members of the subcommittee—in (mostly) bipartisan fashion—detailed the ways in which these firms abuse their monopoly power, particularly on the partners that must use their platforms to reach customers. They had the CEOs off-balance for the duration of the hearing, and in a few choice moments, they yielded what amounted to admissions of guilt about anti-competitive behavior, predatory pricing, and deliberate silencing of rivals.
Much of this must be chalked up to subcommittee chair David Cicilline (D-RI), and his shrewd hiring of Lina Khan, one of the finest scholars of the nascent anti-monopoly movement, as his counsel. Khan not only understands the control these companies wield in her own right, but knows the wealth of journalistic output that has been produced on Big Tech market power. An amazing amount of that reporting was put to use by the subcommittee; at one point, Vice Chair Joe Neguse (D-CO) cited an article by The Verge that they published the same day as the hearing.
This was combined with the committee’s investigative output, which was unusually robust, featuring copious interviews with ex-employees and businesses harmed by Big Tech’s power, as well as internal documents exposing the companies’ aims. Members couldn’t be suckered by CEOs attempting to go over their heads with doublespeak; there was just too much evidence available.
For example, Cicilline opened by questioning Google’s market-dominant position in search, asking Pichai, “Google told us that Google steals their content and privileges their own sites … why does Google steal content from honest businesses?” Pichai tried to filibuster and Cicilline plowed through him, noting that Google increasingly shows its own sites and profitable ads as answers to search queries, something the website The Markup revealed this week. At one point, Cicilline pointed out that Google stole restaurant reviews from Yelp, and when Yelp complained, Google threatened to delist the site entirely. “Isn’t that anti-competitive?” Cicilline asked. Pichai said he wasn’t aware of that and would have to follow up later.
This was a familiar tactic for the CEOs, pleading ignorance about their business practices. But it actually says too much. Either the CEOs are lying, or their companies are so unmanageable that nobody can truly know what they do. When Bezos said that he didn’t know how many counterfeit items were sold on the Amazon marketplace, I believed him because it’s an impossible problem (one that Amazon likes, as they force compliance from third-party businesses by saying they will only clear away the knockoffs if they pay up).
As for Cicilline’s performance, it was indicative of the entire day. Sometimes, members of Congress are damned with faint praise by being called “well prepped,” signifying that someone else did all the work and they attended a briefing. These members were well informed; they understood the source material and they methodically chose targets and hammered them home.
The victims were usually suppliers and partners, people forced to work with Big Tech platforms and finding themselves trapped by them.
House Judiciary Committee Chair Jerrold Nadler (D-NY) released documents (available at the committee website) showing that Facebook viewed Instagram as a threat and bought them to maintain its market position. Rep. Pramila Jayapal (D-WA) detailed how Amazon pulled third-party seller data to inform its own product development, even though there’s a nominal internal rule against such practices, which is routinely breached. Rep. Val Demings (D-FL), a potential vice-presidential pick, pointed out that Google had promised to never merge data across sites with their ad tech subsidiary DoubleClick, but they did it in 2016. Rep. Mary Gay Scanlon (D-PA) recounted the case of Diapers.com, which Amazon crushed into submission by deliberately losing hundreds of millions of dollars on diaper sales to undercut the competition.
This moment, like others, yielded surprisingly good information from the CEOs, in between the claims of ignorance. Bezos essentially said that it was OK to lose money to acquire customers, which is a straight-up admission of predatory pricing. Later on, Zuckerberg admitted that Facebook did clone products of competitors that it was also trying to buy. He didn’t agree with Jayapal’s characterization that he was threatening those companies with copying their services and crushing them, but it was a tacit admission of anti-competitive conduct.
There were definitely some hijinks, as Republicans fell back again and again to whining over being censored on social media sites. But even there, they were making the point that Facebook and Google control the flow of information to such a degree that perceived slights are meaningful. And some went further. Rep. Ken Buck (R-CO) talked about Amazon copying rival technologies. Rep. Kelly Armstrong (R-ND) was a nimble questioner, hitting Amazon for allowing music to stream on Twitch without licensing it (Bezos said he’d get back to him) and how Google is retiring third-party cookies but still retaining the ability to personally surveil users in other ways, building an even bigger gap between them and their competitors.
The victim in most of these scenarios was not a consumer; we are more than our Amazon Prime accounts. The victims were usually suppliers and partners, people forced to work with Big Tech platforms and finding themselves trapped by them, forced to submit to their control. It created a strong understanding that these companies simply have too much power.
The biggest loser in all of this was not the tech companies but the antitrust agencies. The Federal Trade Commission and the Justice Department’s Antitrust Division all had access to the same information that the subcommittee had. They could have made the same case about Big Tech’s market power. The FTC could have blocked the Facebook/Instagram deal, as Republican ranking member Jim Sensenbrenner of Wisconsin pointed out. He said that to defend Facebook, but it was an indictment of the FTC, as was the entire hearing. The antitrust authorities, under Republican and Democratic administrations, completely failed, and nobody in positions of authority at that time should ever hold power, or be listened to, again.
The biggest loser in all of this was not the tech companies but the antitrust agencies.
The subcommittee plans to write a report that will demonstrate the results of its investigation and offer recommendations for legislative and enforcement remedies. They will offer a road map for the next administration for how we handle the monopoly problem in tech, and hopefully across the entire economy. This blueprint will be remembered by legislators, activists, and the general public. It will serve as a yardstick for a potential Biden presidency. They can do their job or continue the bipartisan shrink from taking on monopolies.
The subcommittee proved that, for all the restraints and haplessness of Congress, diligent public servants can actually make a difference and open the window just a crack, letting sunlight through. As Cicilline said at the end of the hearing, quoting Louis Brandeis, so revered as an anti-monopolist that the advocates working on this problem today often call themselves the New Brandeis Movement: “We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.”
