The Conservative Case for Breaking Up Big Tech
(originally published on AMAC)
Former President Donald Trump appeared before a large crowd of conservatives at CPAC in Texas on Sunday—but don’t bother trying to find the video of his speech on YouTube. It’s not there.
Google censored the former president, which is perhaps unsurprising, since he spent much of his one-and-a-half-hour address laying into the Big Tech giants and calling for them to be broken up. This underscored a real tension within the conservative movement about how to challenge the increasing power and influence of Big Tech without abandoning their historic support for capitalism, free, enterprise, and business.
Many Republicans have spoken out against getting “tough” on Big Tech on exactly these grounds: they’re private companies, the conservatives say—so there’s nothing a principled Republican can do.
Yet if Republicans look to history, they will find that the anti-trust advocates of the past often started with a very “conservative” mindset. They saw trust-busting not as a threat to the capitalist system or to free enterprise, but as vital to its preservation. Today, conservatives do not need to embrace big government in order to fight big business. Rather, they need to be willing to prevent certain corporations from exploiting the massive power of big government to their own private advantage.
An Alternative Vision of Anti-Trust
On June 2 the DC District Court tossed a lawsuit by the FTC and several states asking to break up Facebook’s “social media monopoly.” Yet it would be a mistake for conservative critics of the power of big tech companies to weep for the demise of this half-hearted Democratic effort.
At the same time the antitrust case was making its way though the courts, without the support of any senior Biden Administration officials, the Administration was investing its efforts in ensuring that talks regarding a minimum global wealth tax excluded the world’s wealthiest corporations. The agreement on establishing a global minimum tax rate of 15%, supposedly intended to ensure that major multinationals cannot use tax havens to avoid paying taxes anywhere, only allows for the taxation of local operations of multinational tech firms, not the firms themselves. Inserted at the insistence of the Biden Administration, this means in effect that Google, Facebook, Twitter, and other giant tech firms will not in fact be taxed as corporations anywhere. On the contrary, because their local operations will be taxed at local rates but not any profits, any effort to force them to pay taxes in a particular jurisdiction will incentivize them to do exactly what conservatives have always warned businesses will do when faced with higher rates—pass the costs on to local consumers.
That Big Tech received this sweetheart deal from the Democratic Biden Administration is not evidence that charges the Biden Administration is anti-business are overblown. On the contrary, the Biden Administration appears more committed to raising taxes than any Administration in fifty years, whether through the Infrastructure bill working its way through Congress, or international treaties. Instead, the administration’s defense of Big Tech it is evidence of something the original drafters of anti-trust laws recognized. When certain corporations become large, their interests shift from defending the businesses community against government, to using the government against other businesses. Once corporations are big enough to control government, regulations and government taxes no longer threaten them. They can always ensure they are excluded from any of the consequences, as Silicon Valley did with the recent global wealth tax. They no longer have an interest in opposing government regulation or taxes. In fact, these mega corps in some cases have the opposite interest. They find regulations and taxes desirable. While the heavy-hand of government will not seriously hurt them, it can be used to crush their competitors.
This occurs not merely in the form of economic regulations and taxes, but other policies as well. Take COVID-19 as an example. While lockdowns were a catastrophe for small businesses across America, airlines, and retail outlets, they were a bonanza for Google, Zoom, and most of all, Amazon. Lockdowns, by putting Amazon’s competitors out of business, effectively handed a government-enforced monopoly to Jeff Bezos over a large segment of the economy. When wondering why Bezos’s Washington Post championed lockdowns, the answer is self-evident. It was extraordinarily profitable for him to do so.
Conservatives need to understand this dynamic. For decades, a principled commitment to capitalism has sometimes drifted into an unconditional deference to concentrations of power, provided that power was located in the private sector. It was, and remains, inconceivable to many conservatives why corporate leaders would back the Democratic party, much less champion causes such as lockdowns, environmental regulation, critical race theory, or media rules which seem designed to hurt the private sector. They have forgotten that while the Left does hate corporations because they are wealthy, it was conservatives who once backed anti-trust laws because corporations had became too powerful.
The power of companies like Standard Oil did not come from the fact that they were rich. Rather it came from the way Standard Oil and its peers dominated particular parts of the country to such an extent that government was effectively a subsidiary and it could use its control of elected officials, courts, and the police to crush competition and reinforce its own power. Breaking up Standard Oil was not, as leftist historians argue, designed to allow for cheaper prices for consumers or better treatment of labor. To the extent those occurred, they were fortuitous side effects. Breaking up Standard Oil created multiple companies that by competing with each other, checked the ability of any single firm to weaponize government against the others.
The behavior of Silicon Valley firms before and after the 2020 election should make clear why such regulation is necessary. Facebook, Twitter, and Google have the ability to control what Americans see and do not see. They can cancel anyone they chose, effectively erasing them from political existence. Democrats complain about Social Media companies’ wealth—yet when they complain about Big Tech’s power, notice that they do not bemoan its scale, but rather that it is not used more aggressively against those they disagree with. The clear message is that if Social Media companies want to continue to be treated as special “partners” of a Democratic Washington, they need to use their power to advance the Democratic party’s priorities. Nowhere is this more evident than in the social media utterances of Alexandria Ocasio-Cortez who focuses her ire on the unwillingness of firms to ban those who “harass”, i.e. respond critically to her, online.
Senators like Josh Hawley recognize this. It is not a coincidence that Hawley found it hard to get his book, now a bestseller, published.
Republicans need to embrace the original purpose of anti-trust law. This does not mean taxing industries into oblivion. The US government did not nationalize Standard Oil. It did not need to, nor did it want to. Its objection was not to the wealth being in the hands of a private company, but the power being in the hands of a single company and person who could abuse it. In the same way, Republicans should make clear that they do not fear the wealth or prosperity of Silicon Valley. They welcome it. But the power wielded by Facebook, Twitter, and Amazon is too much for a small handful of people to wield in a democracy. Ever since Adam and Eve, humans have been fighting the temptation to God-like power, and the temptation to abuse it was too much for the best men and women. Republicans and conservatives need to make clear that government will not tolerate the interference of unelected individuals who use their market power to thwart democracy, not because they distrust businesses, but because they value them and want to protect them from those who wish to use government to destroy free enterprise. Not all would-be socialists are poor.