Lina Khan’s Confirmation As FTC Chair Puts Big Tech On Notice

Lina Khan’s Confirmation As FTC Chair Puts Big Tech On Notice

For years, tech companies have relied on rich lobbying budgets and networks of policy groups to shield them from any consequences. That time is over.
Rachel Bovard
By

Federal trade commissioners don’t usually make national headlines. But on Tuesday, upon being confirmed 69 to 28 by the Senate and immediately sworn in as the agency’s chair, the confirmation of Lina Khan spawned news alerts that had phones rattling all over the country.

At 32, Khan is the youngest member to join – and lead – the FTC, which is tasked with the dual mission of protecting consumers and promoting competition in the marketplace. As a notable critic of concentrated economic power, her confirmation is designed specifically to guide the agency toward more aggressive enforcement.

This is especially true in the area of Big Tech, where Khan made her name as a Yale Law student in 2017, authoring a paper called “Amazon’s Antitrust Paradox.” The paper suggested that the jurisprudential consensus in America’s antitrust law was insufficient to tackle the concentrated growth in the digital economy, and that Amazon’s retail business should be separated from its selling platform.

So entrenched was the legal community toward an extremely narrow interpretation of the antitrust statutes — to the point that broad enforcement is extremely rare, and potential per se violations of the law are difficult to prosecute, particularly in digital markets — that Khan’s paper was tantamount to the shot heard ’round the staid, well-heeled world of American antitrust. Shortly thereafter, Khan went on to play a lead role for House Democrats in conducting a 16-month investigation into the market behaviors of Apple, Amazon, Google, and Facebook.

Khan’s tenure comes at an auspicious time for the world’s largest tech firms, which are facing national concern about the scale of their power, and a growing cross-party consensus urgently hoping to do something about it.

Last week, the House Judiciary’s antitrust subcommittee introduced five bipartisan bills aimed at addressing critical areas of uncompetitive entrenchment by the country’s largest tech companies. The Department of Justice and 50 attorneys general (AGs) are leading an antitrust lawsuit against Google, while 46 state AGs have joined the FTC in a case against Facebook.

Ohio’s attorney general recently filed a lawsuit claiming Google should be a public utility, and a similar argument is being made in separate legislative proposals from two U.S. senators, one of whom is the lead Republican on the Senate Commerce Committee. The New York Senate just passed a bill to update the state’s antitrust laws, and Florida has a new law prohibiting tech platforms from banning political candidates and giving citizens a private right of action. In the U.S. Senate, everyone from Josh Hawley to Amy Klobuchar to Mike Lee agrees the status quo in federal antitrust enforcement is not working.

This growing consensus is obvious in Khan’s confirmation. In a highly partisan 50-50 Senate, the Biden nominee received 72 votes to end debate on her nomination, and 69 votes to confirm. The filibuster for nominations is gone (all nominees are now confirmed at a majority), but it’s telling that Khan would have easily overcome one had it still been in place. While the parties may not yet completely agree on the specifics of how best to address tech platforms’ multi-sector dominance, Khan’s painless confirmation is a sign they agree that enforcement agencies should be more clear-eyed and aggressive about the problem.

In that regard, Khan’s appointment represents something of a new era of enforcement for the FTC, an agency that has been at times a key enabler of Big Tech’s rise. In 2007, the agency greenlit Google’s acquisition of DoubleClick, a digital ad agency, which launched Google’s untouchable dominance in the ad space.

In 2013, the FTC embarrassingly whiffed again, failing to bring a case against Google — and actually clearing the company of wrongdoing — when presented with hard evidence of anti-competitive intent. A parallel lobbying effort by Google toward the Obama White House raised troubling concerns about the political manipulation to which the agency may have been subjected.

Khan still has detractors among conservatives, who are concerned that her aggressive posture could risk a heavier hand in the market, over-correcting in ways that could limit mergers that are pro-competitive and using regulatory and antitrust authority to impose woke ideological views, as some other countries are already doing. Sen. Mike Lee, who recently introduced his own antitrust reform bill, called Khan’s views of antitrust law “wildly out of step with a prudent approach to the law.”

Past FTC chairs have made it clear that they do not view the agency as having a role in some areas of ideological enforcement. “We are not the political speech police,” said FTC Commissioner Rebeca Kelly Slaughter in 2020, echoing agreement with then-FTC Chair Joe Simons.

In her confirmation hearing, Khan largely focused on the issue of concentration across markets, from digital platforms to agriculture, and the need for the enforcement agencies to understand digital market innovations like black-box algorithms. Ultimately, it remains to be seen what Khan — and who she appoints to run the FTC’s twin bureaus of competition and economics — will emphasize as the agency’s guiding priorities.

In many ways, however, the pendulum is swinging. For decades, federal policy has been driven by entrenched attitudes of tech exceptionalism, with Facebook, Google, Amazon, and Apple coddled by both Republicans and Democrats as the darlings of American commerce and innovation.

But recent actions by the platforms to crush dissent across ideological lines, aggress against small competitors (or “copy, acquire, and kill” them), and develop themselves as unaccountable gatekeepers to the access points of capitalism has fostered a bipartisan skepticism of economic power not seen since the days when Democrat Wright Patman, a rural Texas congressman, worked with the Nixon administration to take on the monopoly banking power of the eastern elite.

In those days, Congress was far more eager to be the electorally accountable self-government of design, and reflect the economic policy parameters most consistent with the social consensus. The modern Congress, however, reflects an increased willingness to outsource critical policy decisions to agencies and the courts.

In some ways, this makes sense. Antitrust enforcement, after all, is law enforcement, and subject to the due process constraints therein. The less Congress does, the more the FTC and the Department of Justice will represent the leading edge in blunting the market power of the tech platforms — and the speech concerns that exist downstream of it.

It is hard to understate the significance of Khan’s appointment, both for how it may change the “see no evil” approach the FTC has taken in the past and what it means about Washington’s policy shift against Big Tech. Khan’s bipartisan, 60-vote-plus confirmation is as much about the evolving policy consensus in Washington as it is about the willingness of the world’s biggest speech and commerce platforms to flex their muscle ideologically against America’s speech values, our free markets, and against self-government that might constrain them.

For years, tech companies have relied on their rich lobbying budgets and network of allied policy groups to shield them from any consequences, regardless of behavior. That time is clearly over. A former FTC chair, Republican appointee William Kovacic, observed the changing tides this way: “She challenged an orthodoxy with others, built a community, that has changed the debate,” Kovacic said of Khan. The tech industry, he noted, “never saw this coming.”

Rachel Bovard is The Federalist's senior tech columnist and the senior director of policy at the Conservative Partnership Institute.

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