Congress gets into weeds of antitrust legislation with focus on funding and media

15 March 2021 00:00 by Claude Marx

Federal Trade Commission

Senate and House lawmakers are beginning the hard work of trying to find common ground between the parties about how to overhaul the nation’s antitrust laws.

While the chairs of the respective antitrust subcommittees have discussed taking wide-ranging action, at recent hearings the focus was on more targeted proposals relating to funding and the news media.

In her debut hearing as chair of the Senate Judiciary Antitrust Subcommittee, Senator Amy Klobuchar heard some support for reforms such as more money for enforcers and more negotiating power for media companies. Even so, there’s a long way to go until she gets bipartisan consensus for more comprehensive legislation.

“This is about saving capitalism and building an economy that works for all Americans. It’s about laws that throughout our history have rejuvenated capitalism,” the Minnesota Democrat said at the March 11 session.

She added that dramatic changes are needed because several markets are already highly concentrated and this hurts consumers and potential competitors.

But the panel’s top Republican, Senator Mike Lee, who has criticized large tech companies, showed skepticism about having the government go too far.

“The consumer welfare standard is not a get-out-of-jail free card,” the senior senator from Utah said.

He also said large tech companies censor conservative ideas, the result being that “we do have a competition problem, but not in the same way as others state.”

Last month, Klobuchar introduced legislation to make significant changes in antitrust laws.

Her bill proposes that the burden of proof be put on the merging parties to show the deal wouldn’t harm competition when it significantly increases market concentration; involves the acquisition of nascent competitors by firms with a 50-percent or higher market share; is a “mega-merger” above $5 billion; or involves an acquirer with a market cap of more than $100 billion making a play for a company worth $50 million or more. It also increases funding for the Department of Justice’s antitrust division and the Federal Trade Commission.

Her co-sponsors of the measure are Democrats.

But more tailored measures have received more bipartisan support. Klobuchar and Senator Charles Grassley, the top Republican on the Judiciary Committee, would increase merger filing fees based on the size of the deal. The additional funds would be used to expand enforcement at the DOJ and FTC.

Grassley, the senior senator from Iowa, has sponsored several antitrust reform measures.

Lee and other GOP committee members such as Senators Marsha Blackburn of Tennessee and Josh Hawley of Missouri spoke of the need to boost funding for the agencies, though didn’t commit themselves to supporting the Klobuchar-Grassley measure.

Another possible area of bipartisan agreement is for a temporary exemption from the antitrust laws for news organizations.

Klobuchar and Senator John Kennedy, a Louisiana Republican, have sponsored legislation that would create a 48-month period in which newspapers could collectively negotiate with Big Tech platforms, including Facebook and Google, about factors affecting public access to trusted news sources. The bill exempts the industry from being prosecuted under the Clayton Act and the Federal Trade Commission Act.

A companion bill has been introduced by House Judiciary Antitrust Subcommittee Chairman David Cicilline of Rhode Island and the panel’s top Republican Ken Buck of Colorado.

At the Senate hearing, Blackburn said the efforts of Big Tech to replace traditional media outlets have resulted in fewer reporters covering the news and this hurts consumers.

“You look at Google’s ad businesses, and you see that what they are going for is clicks, and click baits, and that concerns us,” she said.

But Lee was more apprehensive about the idea and warned of the dangers of “federally sanctioned rent seeking.”

At a March 12 hearing of his subcommittee dedicated to his bill, Cicilline said the measure is needed because “it is clear that we must do something in the short term to save trustworthy journalism before it is lost forever. This bill is a life support measure, not the answer for ensuring the long-term health of the news industry.”

Buck focused on curbing the power of Big Tech and said society “can’t let them be arbiters of truth and wielders of government-like power.”

Other Republicans on the panel seemed unsure of an antitrust carveout for media companies.

Representative Matt Gaetz of Florida, a co-sponsor of the bill, said he’s having second thoughts because “not every failure of a newspaper is a failure of democracy.”

Representative Darrell Issa of California said “when government begins to pick winners and losers, there’s no end in sight.”

The session was the second in a series of hearings that will examine policy solutions to the problems discussed in the panel’s report on tech platforms Amazon, Apple, Facebook and Google. The next hearing, which will deal with “Strengthening the Laws to Address Monopoly Power,” is scheduled for March 18.

Cicilline has said he’ll unveil comprehensive legislation on antitrust after the hearings have concluded.

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