August 1, 2020
At Wednesday’s House Judiciary Subcommittee on Antitrust hearing, tech CEOs Jeff Bezos of Amazon, Mark Zuckerberg of Facebook, Tim Cook of Apple and Sundar Pichai of Alphabet (Google’s parent company) took a beating from lawmakers who grilled them on everything from monopolistic business practices to social media censorship to why one congressman’s campaign emails keep ending up in his father’s spam folder.
It is highly doubtful that the hearing will have any effect on the behavior of any of these companies or their CEOs, let alone lead any closer to their breaking up, as called for by Sens. Bernie Sanders (I-VT), Elizabeth Warren (D-MA), Rep. Alexandria Ocasio-Cortez (D-NY) and other lawmakers and advocates, including Ethics In Tech. They simply have too much wealth, power and influence right now for that to be a realistic option at this point.
So much wealth, in fact, that just two of the CEOs — Bezos and Zuckerberg — made more money since Wednesday than what more than 2,000 average US earners will make in their combined lifetimes.
It may have seemed appropriate when Rep. David Cicilline (D-RI), chairman of the antitrust subcommittee, called the Amazon, Apple, Facebook and Google “emperors of the online economy.”
In reality, however, few if any emperors could dream of the kind of wealth amassed by tech titans.
Since Wednesday’s hearing, which was three days ago for future readers, Bezos and Zuckerberg alone have increased their net wealth by a staggering sum — over $6 billion. According to The Wrap:
Zuckerberg added about $7 billion to his net worth on Friday, according to Bloomberg’s Billionaires Index, as Facebook’s stock rocketed higher a day after the company reported Q2 revenue and earnings that topped Wall Street’s projections. The 36-year-old is now worth an estimated $96 billion.
At the same time, Bezos was $6.3 billion wealthier by the end of Friday’s trading session as well, after Amazon’s share price increased 3.7% on the day. Like Facebook, Amazon’s stock jump came after the e-commerce giant reported a $88.9 billion in Q2 sales, easily lapping analyst projections.
The article goes on to state that “if Amazon’s Wall Street run continues next week, Bezos could be the first person to hit $200 billion in net worth.” According to Bloomberg, he is now worth $188 billion.
Ethics In Tech agrees with Rep. Ocasio-Cortez’ assertion that “every billionaire is a policy failure.” So what can be done about Big Tech? For what we consider a model approach, we turn back to the words of Sen. Warren, who wrote this in a 2019 Medium post:
First, by passing legislation that requires large tech platforms to be designated as “Platform Utilities” and broken apart from any participant on that platform. Companies with an annual global revenue of $25 billion or more and that offer to the public an online marketplace, an exchange, or a platform for connecting third parties would be designated as “platform utilities.”
Second, … appoint regulators committed to reversing illegal and anti-competitive tech mergers. Current antitrust laws empower federal regulators to break up mergers that reduce competition. I will appoint regulators who are committed to using existing tools to unwind anti-competitive mergers… Unwinding these mergers will promote healthy competition in the market — which will put pressure on big tech companies to be more responsive to user concerns, including about privacy.
Even President Trump, who is not for breaking up big tech companies, has admitted that “obviously there is something going on in terms of monopoly.” Of course, the president’s opposition to tech companies could have plenty to do with their traditional support for Democratic candidates, or how some of them have cracked down on online hate speech and misinformation, including by the president, his relative and his supporters, or how the Bezos-owned Washington Post has held his administration to account. But he still makes a valid point.
It’s not like we haven’t been here before. Ironically, it was government action against one of the tech giants — Microsoft — that opened the door for the emergence of today’s tech billionaires.
Back in the 1990s, the government targeted Microsoft for monopolistic practices that violated the Sherman Antitrust Act. The world’s number one software company, headed by Bill Gates, the world’s richest person at the time, lost its case, and with it, its browser monopoly. But at the time the government’s decision to take on Microsoft was not a very popular one. Critics argued then as they do now that reigning in the power of such a powerful force in the tech world would stifle innovation and ultimately harm the booming economy.
Of course, nothing of the sort happened. Quite to the contrary, what followed after a brief a stock market bust was nothing short of Web 2.0 and the emergence of Big Tech as a global economic and political force to rival the financial services industry.
Ethics In Tech founder Vahid Razavi has long advocated breaking up companies like Amazon and Facebook.
“I would submit to Jeff Bezos that he would grow even richer if he were to break up the company,” Razavi argues in his second book, Ethics In Tech and Lack Thereof: Sleeping Under the Cell Tower (click here for free download). Referring to the Standard Oil breakup, Razavi wrote that “that epic trust-bust created 34 separate companies, and Standard founder John D. Rockefeller continued to own significant equity in these.”
“As each of them grew on their own, so too did Rockefeller families fortunes grow,” Razavi continued. “Rockefeller was the richest man of his time. Bezos is the richest man of our time. He would still be — and perhaps be even richer — if Amazon were split up.”
(Photo Credit: Jericho/Wikimedia Commons)