A Project of National Affairs

A Time for Choosing: The Conservative Case Against Weaponizing Antitrust

Joshua D. Wright and Jan M. Rybnicek

Conservatives are at a crossroads in their relationship with big government and big tech. It is, as Ronald Reagan so eloquently put it during his 1964 campaign speech for Barry Goldwater, a time for choosing.[i] One path not only requires, but champions, expanded government control of tech firms for the "greater good" designed by regulators and bureaucrats. The other path relies upon competition, markets, and the rule of law to foster individual liberty and economic growth. Conservatives, rightly frustrated by digital platforms’ poor treatment, are increasingly attracted to the former path. The benefits of that path are obvious and satisfying in the short run, at least in part because they provide instant gratification and a healthy dose of retribution. But it is the wrong path. As Reagan correctly observed, a government cannot control the economy without controlling its people. The choice before us will have immense consequences for the role of government and the rule of law for generations to come. It is important to get it right.

It has long been vogue among liberal advocates to champion expansion of government control over firms, their decisions, and internal workings. Perhaps no better present example can be found than in the area of antitrust, where the policy landscape looks eerily similar to the progressive view articulated 60 years ago, littered with a hodgepodge of proposals to “break up” large firms, prohibit all mergers and acquisitions, assign burdens of proof to the accused, and control the design of products. Today’s progressives offer much of the same medicine for what allegedly ails the modern economy. Senator Warren has proposed, for example, to “break up big tech” platforms such as Amazon, Apple, Facebook, and Google, and to make technology companies criminally liable for misinformation presented on their platforms.[ii] While the large and successful American tech firms—the envy of the global economy—make a convenient target for these proposals, do not be fooled. This wolf comes as a wolf. The modern progressive antitrust agenda is part of a broader, more radical program—self-described as Neo-Brandeisian Antitrust—to turn antitrust law upside down so that it may be weaponized to shape and plan all sectors of the economy.

These proposals, while unfortunate and misguided, draw heavily upon standard liberal orthodoxy that has tended to be largely suspect of markets and the agency of individuals. One can hardly be surprised to see a staunch progressive like Senator Warren or Bernie Sanders advocate greater government control over private life. Perhaps one even grows to expect it.

What is more surprising, however, is the company Senator Warren and the Neo-Brandeisian Antitrust movement have attracted with the siren call of using the antitrust laws to centrally plan the tech sector (among others things), and to achieve greater government control of the interactions between individuals and the technology we use in our daily lives. Stalwart conservatives like Senator Hawley, for example, among others, have offered policy proposals to “deal” with “Big Tech” that eerily mimic those of Senator Warren and the command and control left. Senator Hawley has proposed legislation that would rewrite Section 230 of the Communications Decency Act and usher in a quasi-Conservative Fairness Doctrine for the internet.[iii] Indeed, Hawley’s proposal would place the Federal Trade Commission in the Big Brother position of determining when a social media platform’s moderation decision was “designed to” or “motivated by an intent to” negatively impact a political party. Attorney General Barr has offered a similar refrain, announcing that antitrust is an appropriate tool to police political bias.[iv] And President Trump recently signed an executive order that directs the Federal Trade Commission to explore using its consumer protection authority to sue social media platforms for content moderation decisions.[v]

Without question, the emotional appeal undergirding these actions is understandable. Conservative voices and opinions too often face a stacked deck when dealing with technology companies and social media, in particular. And this bias against conservative voices has taken on new life in the Trump era. But the hallmark of conservative values has been to rightfully eschew government control over economic life and to value principle over expediency. What is at stake, however, with the current proposals to upend modern antitrust to address tech markets is more important than whatever fleeting satisfaction is gained from exacting policy revenge on firms perceived to squelch conservative voices and ideas. At stake are conservative commitments to the rule of law and the role of the judiciary—newly stocked with immense talent by the Trump administration—in preventing government expansion and overreach. And if we resign ourselves to transient political wins, and debase the belief that entrepreneurs rather than bureaucrats should shape technology markets, we risk not only undermining these great causes conservatives have championed for decades but also the enormous economic gains to Americans that arise in our highly competitive tech markets.

Readers less familiar with antitrust law may not understand its critical role in the conservative legal movement. Modern antitrust law—and its consumer welfare standard—is a complex product of powerful ideas, extant economic evidence, and jurists like Bork, Thomas, Scalia, Easterbrook, and Doug Ginsburg taking on the wobbly intellectual foundations of 1960s competition law. That their efforts were so successful in persuading their liberal counterparts on the Supreme Court and lesser federal courts to join in the dismantling of the stale and obsolete antitrust that was then the law of the land is powerful evidence of the force of their ideas. It is difficult to find an area of law where the conservative legal movement enjoyed as much success as quickly and with such resounding results.

No doubt it helped that yesteryear’s antitrust was intellectually bankrupt and an insult to the rule of law. It pursued an unfortunate amalgamation of contradictory doctrines, including undefined notions of populism, protection of individual industries, and reducing firm size, that could be used to justify nearly any result. For instance, antitrust law allowed the market-leading frozen pie manufacturer in Utah to successfully sue its three national-brand competitors for eroding its high market share through a series of price cuts—thereby preventing precisely the type of competition the law was intended to protect. Antitrust law was so unprincipled and incoherent at the time that it led Justice Potter Stewart to observe while reviewing a government suit to block a merger between two grocery stores with a combined market share of 7.5% that, “The sole consistency that I can find is that, in litigation under [the merger laws], the Government always wins.”[vi]

The conservative legal movement, powered by the intersection of economic analysis and law, brought the rule of law to the wild and untamed progressive antitrust vision of the 1960s. Grounding antitrust law in a disciplined and tractable framework not only promotes the rule of law while preventing arbitrary and capricious enforcement, it also creates a stable and predictable environment for private actors and firms to invest and innovate. Of course, no doctrine is perfect and today’s antitrust is not without its own flaws. But it is tethered to robust economic evidence and common-law developments that promote competitive outcomes and, like the common law, has built-in mechanisms to improve and evolve in response to empirical evidence. But the coherent and principled makeup of antitrust should not and cannot be taken for granted.

Proposals today that are attracting conservatives and liberals alike aim to unwind these gains in exchange for granting those who happen to have power in the government a dominant hand in controlling tech firms on the fleeting hope that the power will be deployed for the greater social good. We have experience with this approach to antitrust in the United States. It is what we used to do. And we know better. Shifting power from judges to regulators, and then allowing those regulators to pick winners and losers to achieve political and social goals, is a recipe for abandoning conservative commitment to the rule of law while simultaneously sacrificing economic growth and innovation. The price is too high, with little or nothing to offer those who value individual liberty, the rule of law, and economic growth. While progressive ideology is contiguous with increasing government control over economic and social interactions in technology markets for its own sake, conservative principles are not. The proposed bargain is also remarkably short-sighted. It should go without saying that empowering partisan regulators to enforce a Fairness Doctrine for conservatives is not likely to work out so well when the other side is in control.

Conservatives traditionally have been wary of proposals by liberals and other big government proponents seeking to substitute the judgment of regulators and bureaucrats for those of entrepreneurs and innovators. And rightfully so. Such proposals, even when well intentioned, risk making Americans worse off. Progressives and populists now seek to commandeer antitrust to usher in a new era of central planning in order to achieve social policy objectives that they could not accomplish otherwise. But at what cost? The risks are not trivial. Using antitrust to redesign tech companies and their products will undermine the competitive dynamics that have brought Americans countless modern benefits, including smartphones, fast and easy online shopping, on-demand ride hailing, easy-to-access streaming media, and a bevy of free services including email, maps, and video conferencing. It also will threaten the incredible economic growth and job creation that these companies have brought to America’s shores. And while politicians surely will make promises akin to, “if you like the digital platform you have, you’ll get to keep it,” it is all too clear that when you expand government discretion and limit judicial oversight, those in positions of power will increasingly impose their preferences on the broader society. Ask yourself, do you really want the government designing the iPhone?

The reality is that the U.S. digital economy is highly competitive and serves Americans well. Fueled by investment, innovation, and entrepreneurship, the digital economy has contributed substantially to America’s economic growth. According to the Bureau of Economic Analysis, the digital economy accounted for 6.9 percent of gross domestic product in 2017, growing at an annual rate of 9.9 percent since 1998 as compared to 2.3 percent for the economy overall.[vii] That economic growth has been driven by some of the world’s most successful tech companies, such as Amazon, Apple, Facebook, Intel, Google, and Microsoft, each of which calls the United States home. These firms are investing ever-increasing amounts on research and development to innovate new products and stay competitive. In fact, the United States leads the world in research and development spending, and tech companies lead in the United States—representing the nation’s top five spenders with investments totaling more than $75 billion in 2018.[viii] Tech companies rank second (behind the telecom sector) in U.S. capital expenditures, with Alphabet (Google’s parent company), Amazon, Apple, Facebook, Intel, and Microsoft together spending more than $45 billion in 2017.[ix] And these investment figures are only expected to continue to grow. These are hardly the actions of monopolists resting on their laurels, secure in belief that they are untouchable by competition.

And there is more good news. Tech has only touched a portion of the U.S. economy to date, meaning that there still are opportunities for tech companies to foster economic growth by transforming stagnant industries such as housing, transportation, manufacturing, and health care for the better. And where are the next generation of innovators and tech entrepreneurs calling home? The United States. Recognizing an economy that is dynamic and rewards creativity, venture capital investing has soared to record levels in the United States—surpassing $140 billion in 2018—providing startups with the capital necessary to innovate, compete, and grow.[x] Today the United States is home to half of all startups valued at more than $1 billion—so-called “unicorns”—outpacing every other country in the world by a wide margin.[xi]

Now, some conservatives chafe at recitations of facts and claim that technology companies exclusively benefit only the privileged. But this economic growth and investment have led to substantial benefits to ordinary American consumers and workers. You need only look to the numerous free services that tech has brought to consumers. Americans place significant value on these free services. One peer-reviewed study published by the National Academy of Sciences found that consumers would need to receive a yearly payment of $3,600 to give up free internet maps, $8,400 to give up free email, and $17,500 to give up free search engines.[xii]

Tech firms also have spurred change in long stagnant industries by developing new products that spark competition across quality, price, and other dimensions. Take for instance ride-sharing apps. Local cab companies long had a stranglehold on taxi services and saw little need to innovate or evolve. Ride-sharing apps like US-based Uber and Lyft disrupted the livery service industry by offering lower-cost and more convenient services. Cab companies have been forced to respond by offering easier payment methods and other innovative services that enhance the consumer experience. Proponents of using antitrust to restructure or even break up tech companies are unable to explain how their sweeping plans, however carefully scripted, would not undo the business models that made these services and their associated benefits possible. The burden should be on those seeking to use antitrust to remake the digital economy to demonstrate that the risk is justified. It is hard to believe how it could be.

The digital economy also has been an important source of job creation. According to one estimate, nearly 12 million people held tech jobs in the United States in 2018.[xiii] Today the largest U.S. tech companies have replaced the major American employers of the past. In just under two decades, Amazon, Apple, Facebook, Alphabet, and Microsoft have employed more than one million workers.[xiv] In 2016, Amazon became the fastest company to employ 300,000 Americans—surpassing Walmart and General Motors.[xv] Moreover, while the share of economic output going to workers has been declining steadily overall for many years both in the U.S. and globally, in the tech and telecom sectors the labor share has been steady and even has increased, suggesting improved worker welfare.[xvi]

But that is only part of the story. These major tech firms not only directly employ Americans, but through their investment and innovation, they have created entirely new markets that also have created millions of jobs. Take for instance the app economy—a more than $1 trillion global industry—that has created millions of U.S. jobs since Apple’s iPhone launched in 2007. According to one estimate, the U.S. had more than two million app-related jobs as of April 2019.[xvii] America’s large tech companies also benefit small businesses in yet another way: by connecting them to new markets that they could not access before. Today small businesses are able to take advantage of the major tech firms’ size and scale to grow domestically and compete globally with affordable and secure services.

None of this is lost on Americans. While politicians in Washington have used the tech industry as a punching bag, most Americans would prefer that legislators focus on other industries, including most prominently health care, an industry in which competition suffers despite (or because of) significant government involvement.[xviii] In fact, a mere 17 percent of registered voters think that Congress should make regulating tech a top priority, placing it last among issues surveyed.[xix] That is likely in part because Americans generally trust tech firms and acknowledge the benefits they have brought to U.S. workers and consumers. One study found that Amazon, Google, and Netflix ranked as the most loved brands in the United States.[xx] Another study found that nearly 40 percent of Americans trusted Amazon and Google, which is striking given that only a mere 7 percent of Americans said they trusted the government.[xxi] It is no wonder that a majority of Americans oppose breaking up the largest tech companies: the result would be putting faith in the unlikely proposition that the government can do better.

None of this means that the tech sector should be immune from antitrust scrutiny, that there are not serious economic issues facing American businesses and workers, or that certain tech platforms have shown an unmistakable bias against conservative viewpoints. Where anticompetitive conduct exists, it can and should be challenged under the existing antitrust laws and legal doctrines, which are more than capable of protecting competition in the digital economy. And the antitrust agencies are right to be vigilant against potential anticompetitive behavior by the major U.S. tech companies given their significant presence across key parts of the US economy.

But conservatives should be skeptical of attempts by politicians and bureaucrats to reorder economies simply to appease current animosity against tech firms and put at risk the substantial benefits they have brought to American consumers and workers. And that is precisely what recent radical proposals would do. These proposals include abandoning the consumer welfare standard that has helped make antitrust a coherent and principled body of law. Liberals instead seek to untether antitrust from the rule of law and return it to its Stone Age by reintroducing vague new “public interest” tests with multiple conflicting goals or by reestablishing arbitrary and obsolete market share thresholds—either of which would serve only to increase government discretion. Others have called to overturn unanimous and supermajority judicial precedent that are the foundations of the modern economic approach to antitrust. Still others seek to abandon the principle that it is the government and not business firms that bears the burden of proof of demonstrating the legality of free enterprise. These proposals require businesses to affirmatively prove to regulatory bodies that commercial conduct is not only not harmful but also that it is beneficial—beneficial to whom exactly is still unclear. And, of course, there have been calls to ban nearly all mergers, even those like Amazon’s acquisition of Whole Foods, which did not consolidate two rival companies and has brought customers lower prices and better services. These efforts inevitably will only be the starting point; and with no limiting principle will increase the government's authority to substitute its own judgement for those of entrepreneurs.

Conservatives long have believed in competition, markets, and the rule of law. The late Justice Scalia famously noted that antitrust’s signature statute, the Sherman Act, is “indeed the ‘Magna Carta of free enterprise’ … but it does not give judges carte blanche to insist that a monopolist alter its way of doing business whenever some other approach might yield greater competition.” The force of Justice Scalia’s admonition that the antitrust laws are not an appropriate vehicle for tinkering with the inner workings of private firms is even stronger when the tinkering is not even in furtherance of greater competition, but for political ends. Those core principles should not hastily be sacrificed now to achieve transient political satisfaction against America’s largest tech companies.

The tech sector is a centerpiece of the modern U.S. economy. America’s tech firms have innovated countless new products, created millions of U.S. jobs, and now are simultaneously envied and attacked by our counterparts abroad. As Ronald Reagan observed in 1964, the government rarely does anything as well or as economically as the private sector. And when the government does seek to control the economy it invariably does so through force or coercion of the people. An invitation to allow politicians and bureaucrats to use antitrust law to break up tech companies, to redesign digital products, or to moderate content for the “greater good” will end like most attempts at introducing just a little bit of liberal orthodoxy: the government’s discretion will grow and the people’s ability to check it will fade overtime until it is a figment of its former self. It is the camel’s nose under the tent. Now is the time for conservatives to choose whether they have a newfound faith in central planning or if they will recommit to principles of limited government and free markets.

[i] See Ronald Reagan, A Time for Choosing (televised Oct. 27, 1964).

[ii] Elizabeth Warren, Here’s how we can break up Big Tech (Mar. 8, 2019), https://medium.com/@teamwarren/heres-how-we-can-break-up-big-tech-9ad9e0da324c; Fighting Digital Disinformation, WARREN DEMOCRATS (Jan. 29, 2020),

[iii] See Ending Support for Internet Censorship Act, S. 1914, 116th Cong. (2019).

[iv] William Barr, United States Att’y Gen., Interview with Maria Bartiromo, FOX NEWS (Jun. 21, 2020), https://www.foxnews.com/transcript/exclusive-maria-bartiromo-interviews-ag-barr-on-police-reform-big-tech-censorship-durham-investigation (asserting that social media platforms are “starting to censor different viewpoints” and that “this can be addressed . . . through the antitrust laws and challenging companies that engage in monopolistic practices.”).

[v] Exec. Order No. 13,925, 85 Fed. Reg. 34079 (Jun. 2, 2020).

[vi] United States v. Von’s Grocery Co., 384 U.S. 270, 301 (1966) (Stewart, J., dissenting).

[vii] Kevin Barefoot et al., Research Spotlight: Measuring the Digital Economy, SURV. CURRENT BUS., May 2019, at 6–12, https://apps.bea.gov/scb/2019/05-may/pdf/0519-digital-economy.pdf.

[viii] Erin Duffin, Ranking of the 20 Companies with the Highest Spending on Research and Development in 2018, STATISTA (July 22, 2020), https://www.statista.com/statistics/265645/ranking-of-the-20-companies-with-the-highest-spending-on-research-and-development

[ix] Michael Mandel & Elliott Long, Investment Heroes 2018: Encouraging and Diffusing Innovation Throughout the Economy, PROGRESSIVE POL’Y INST. (2018), https://www.progressivepolicy.org/wp-content/uploads/2019/02/PPI_Investment-Heroes_V6-2.pdf

[x] PITCHBOOK DATA, INC., Q4 2019 PITCHBOOK-NVCA VENTURE MONITOR 5 (2020), https://nvca.org/wp-content/uploads/2020/01/Q4_2019_PitchBook_NVCA_Venture_Monitor.pdf

[xi] ALEX GRAHAM, State of the Venture Capital Industry in 2019, TOPTAL (2020), https://cdn2.hubspot.net/hubfs/2799924/Finance%20Decks/Whitepapers/Finance/State_of_the_Venture_Capital_Industry_in_2019_-_02.pdf

[xii] Erik Brynjolfsson et al., Using Massive Online Choice Experiments to Measure Changes in Well-Being, 116 PROC. NAT’L ACAD. SCI. 7250, 7252 (2019).

[xiii] THE COMPUTING TECHNOLOGY INDUSTRY ASSOCIATION, CYBERSTATES 2020 (March 2020), https://www.cyberstates.org/pdf/CompTIA_Cyberstates_2020.pdf.

[xiv] Nate Rattner & Will Feuer, Amazon is Responsible for Most Big Tech Job Growth Since 2000, CNBC (Nov. 4, 2019), https://www.cnbc.com/2019/11/04/how-many-jobs-have-amazon-google-and-apple-created-since-2000.html

[xv] Michael Mandel, A Historical Perspective on Tech Job Growth, PROGRESSIVE POL’Y INST. (2017), https://www.progressivepolicy.org/wp-content/uploads/2017/01/tech-job-boom-1-12c-17-formatted.pdf.

[xvi] Michael Mandel, The Digital Sector: Rising Labor Share, Falling Gross Margin, PROGRESSIVE POL’Y INST. (2018), https://www.progressivepolicy.org/wp-content/uploads/2018/08/Labor-share-gross-margin.pdf.

[xvii] Michael Mandel, U.S. App Economy Jobs Update, 2019, PROGRESSIVE POL’Y INST. (Sep. 2, 2019), https://www.progressivepolicy.org/blog/u-s-app-economy-jobs-update-2019

[xviii] Sam Sabin, In Washington, Cracking Down on Big Tech Is Popular. In the Rest of U.S., Not So Much, MORNING CONSULT (Sep. 18, 2019), https://morningconsult.com/2019/09/18/in-washington-cracking-down-on-big-tech-is-popular-in-the-rest-of-u-s-not-so-much.

[xix] MORNING CONSULT & POLITICO, NATIONAL TRACKING POLL 5 (May 17–19, 2019), https://www.politico.com/f/?id=0000016a-dc4a-df31-a1ee-fdea3be80002.

[xx] Most Loved Brands in America 2019, MORNING CONSULT (Apr. 5, 2019), https://morningconsult.com/most-loved-brands-2019

[xxi] MORNING CONSULT, SPECIAL REPORT: THE STATE OF CONSUMER TRUST 11 (2020), https://morningconsult.com/wp-content/uploads/2020/01/Morning-Consult-The-State-of-Consumer-Trust.pdf


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