In fining Google a record 2.4 billion euros (2.7 billion
dollars) in June, 2017, for unfairly favoring its advertisers in its online
shopping service, E.U. officials went “significantly further than their
American counterparts.”[1]
At the time, Google held more than 90 percent of the online search market in
the E.U. Why would the E.U. go further than the U.S. in pressing anti-trust
violations against a technology company that could be expected to gain monopoly
profits? Presumably Google was favoring its advertisers on searches in the U.S.
as well. Americans would mind too when an advertiser’s higher-price product
comes up rather than a comparable product at a better deal. Was the E.U. more
interested in protecting consumers and less concerned about pleasing a large
company? The company’s sordid, self-serving practice nullifies any contending claim
that the government’s motive was to go after a foreign company. I submit that
the E.U. government’s action unwittingly points to a pro-business bias in the
corresponding American government.
With the demand that Apple repay $14.5 billion in back taxes
in the E.U. state of Ireland, an investigation into Amazon’s tax practices in
the E.U., and “concerns about Facebook’s gathering and handling of data,” the
E.U.’s anti-trust division was “laying down a marker for more hands-on control
of how the digital world operates.”[2]
Why no such marker in the U.S.’s anti-trust division? Clearly, concerns about
Facebook were not uncommon there. The E.U. “is setting the agenda,” Nicolas Petit
said at a European university.[3]
Suddenly America looks like the Old World.
Especially after the Citizens
United decision by the U.S. Supreme Court in 2010 allowing unlimited
spending by companies on political campaigns, the question of the power of
large companies in the halls of Congress as well as in the White House at the
expense of consumers became more important even if the media kept the issue
largely off the public’s radar screen. Is what is good for GM good for America?
The fallacy that what is good for a part is necessarily good for the whole is
enough to settle that question. The problem, therefore, lies in certain parts
having inordinate influence over the whole—more specifically, on the rules by
which the whole operates. Insufficient regard for the public good by public
officials who don’t want to risk offending corporate chieftains is like the
captain of a ship steering according to the desires of certain wealthy
passengers instead of looking out ahead.
So it is telling, I submit, that the E.U.’s anti-trust
division essentially shamed its American counterpart in being willing to stand
up to very powerful private interests. The “proof in the pudding” lies, I
suppose, in the dearth of cases in which the U.S.’s government (and those of
the member states) has spoken truth to the powers behind the throne and gone on
to act on that truth in enacting laws and regulations that protect the public.
All too often, American regulatory agencies are captured by the very companies
that are to be regulated. Beyond the agencies’ reliance on their respective regulatees
for market information and the regulatees’ ability to hire former regulators
for lucrative jobs, a company’s monetary influence in electoral campaigns gives
elected representatives a powerful incentive to pressure the regulatory
agencies to go easy on even an entire industry. From a company’s standpoint, unwanted
regulations can be softened or averted outright, or new regulations can be used
strategically at the expense of typically smaller competitors that are less
able monetarily to comply with stiffer mandates. So it is not simply more
regulations that attest to a willingness to “speak truth to power.” Government
officials with the courage (and fortitude) to protect the public cannot simply
enact laws and regulations that are in a dominant company’s interest. Clearly,
the E.U. passed this test in being willing to stand up to Google.
[i]
Mark Scott, “Google
Fined Record $2.7 Billion in E.U. Antitrust Ruling,” The New York Times, June 27, 2017.
[ii]
Ibid.
[iii]
Ibid.
