How Joe Biden Became A Trust Buster

A small group of thinkers challenged 40 years of economic ideology on corporate concentration, created a bipartisan movement and won over the president.

Barry Lynn had spent years trying to convince American politicians to worry about corporate concentration. It was, in his words, like “pushing a boulder up the hill” throughout much of the George W. Bush and Barack Obama administrations. That began to change with a fortuitous phone call he received in February 2016.

The staff of Sen. Elizabeth Warren (D-Mass.) invited Lynn, executive director of an antitrust think tank that’s now called the Open Markets Institute, to a policy discussion over dinner. He could bring any other experts he wanted.

Warren, a markets enthusiast and former Republican who had become one of the country’s foremost experts on financial regulation, had an inkling that the consolidation problem plaguing Wall Street might be affecting other sectors of the economy, and she wanted to learn more.

Lynn brought along Teddy Downey, editor of a financial policy-focused Capitol Hill newsletter, and two committed anti-monopolists: Lina Khan, then a Yale law student, and Jonathan Kanter, a corporate lawyer who had been a Federal Trade Commission staffer.

Five years later, President Joe Biden named Khan to lead the Federal Trade Commission. Kanter is Biden’s nominee to lead the antitrust division of the Department of Justice. One of Warren’s protégés, now a top staffer at Biden’s National Economic Council, played a leading role in drafting a July 9 executive order declaring a “whole-of-government approach” to combating corporate consolidation and “unfair competition” in the U.S. economy.

“That executive order was the most important statement about regulating economic power since the New Deal,” said Lynn, a former business journalist convinced by the disruptive effects of a Taiwanese earthquake in 1999 that federal antitrust enforcement should return to its more aggressive Rooseveltian roots.

In Lynn’s eyes, the march toward Biden’s early and wholehearted embrace of the anti-monopoly movement ― and the first possibility of real government action against decades of corporate concentration ― began with Warren peppering the quartet with questions over a light buffet in her office.

Inspired by what she heard, Warren would go on to deliver a speech in June 2016 about “reigniting competition in the American economy” at Open Markets.

“The country needs more competition ― and more competitors ― to accelerate economic growth, more competition to promote innovation and more competition to reduce the ability of giant corporations to use their money and power to bend government policy and regulation to benefit themselves,” she declared.

If the 2008 financial crisis, in which the government bailed out “too big to fail” Wall Street banks, had shown the country the dangers of corporate consolidation, Warren, in conjunction with figures like Lynn, was beginning to prescribe solutions proportionate to the scale of the problem.

“People were waking up every day with bruises all over their bodies,” Lynn said. “We helped them see the fist.”

Warren’s speech was the first of several inflection points, fostered by a feisty cadre of public intellectuals and political insiders, that propelled aggressive antitrust enforcement to the heights of power in Washington, culminating in Biden’s embrace.

“I’m a proud capitalist. I spent most of my career representing the corporate state of Delaware. I know America can’t succeed unless American business succeeds,” Biden said when unveiling the executive order earlier this month. “But let me be very clear: Capitalism without competition isn’t capitalism; it’s exploitation.”

Other pivotal moments included Donald Trump’s election and the role that Big Tech played in his success, the New America Foundation’s expulsion of Lynn’s think tank at the behest of Google, the prominence of antitrust policy in the 2020 Democratic presidential primary, and the successful persuasion of Biden and his inner circle of advisers that curbing monopoly power was both essential policy and smart politics.

‘The Misguided Philosophy Of People Like Robert Bork’

Lina Khan, now the chair of the Federal Trade Commission, was still a law student when she wrote a journal article challenging Amazon’s dominance over the economy, bucking decades of economic and legal thinking.
Lina Khan, now the chair of the Federal Trade Commission, was still a law student when she wrote a journal article challenging Amazon’s dominance over the economy, bucking decades of economic and legal thinking.
The Washington Post via Getty Images

Antitrust enforcement in the United States dates to the late 19th century, when Progressive Era reformers created policy tools to confront the monopoly power of a handful of “robber barons” who dominated railroads and other emerging industries. In the 1930s, Franklin D. Roosevelt and his populist allies in Congress took trust-busting to new heights, bringing in a Golden Age of corporate regulation that lasted through the 1960s.

But in the 1970s, with high inflation and unemployment increasing skepticism of liberal economic principles as a whole, the reigning, bipartisan antitrust dogma fell under intellectual attack from the libertarian right.

The most influential assailant against the New Deal antitrust consensus was then-Yale law professor Robert Bork. In 1978, Bork wrote “The Antitrust Paradox,” arguing that “the only legitimate goal of antitrust is the maximization of consumer welfare.” He also contended that the stringent enforcement of antitrust laws sometimes had the effect of thwarting more efficient economies of scale, which would deprive consumers of the lowest prices.

In subsequent decades, Bork’s interpretation proved so influential ― across the ideological and partisan spectrum ― that Biden, who helped torpedo Bork’s confirmation to the Supreme Court in 1987, felt compelled to call him out by name in his July 9 remarks announcing the executive order.

“Forty years ago, we chose the wrong path, in my view, following the misguided philosophy of people like Robert Bork and pulled back on enforcing laws to promote competition,” Biden said.

Under the guidance of figures like Lynn and his disciples at a newer group, the American Economic Liberties Project, intellectuals and advocates living in Bork’s shadow sought to document the ways that decades of declining antitrust enforcement had affected the economy ― not unlike the way that Bork endeavored to unmask the blindspots of the dominant antitrust school of his era. They marshaled this research to argue for a return to antitrust policy that accounted for the effect of corporate concentration on innovation, competition, workers and the political system.

More than any other sector, the anti-monopolists’ exposure of corporate concentration and predatory practices in a handful of dominant technology firms, including Facebook, Apple, Amazon, Netflix and Google, has upended the way the political establishment looks at the issue.

For example, Khan’s 2017 paper in the Yale Law Journal, “Amazon’s Antitrust Paradox” ― a cheeky nod to Bork ― explored the many ways that Amazon used its size, platform and reach into multiple business sectors to bury competitors as federal regulators looked on.

Some troubling practices she enumerates include Amazon tying access to e-books to the purchase of Amazon-produced technology and using the data of merchants who sell on its e-commerce platform to undercut them on price with its in-house products.

Antitrust advocates are calling either for companies like Amazon to be broken up or to be regulated like public utilities.

“Google, Facebook and Amazon are the railways of the 21st century. They are essential facilities, essential pathways to markets for people who have something to say or something to sell,” Lynn said. “As you do with the railways, you say, ‘You have to carry everybody. You have to offer them the same terms of service, the same pricing, and you have to carry them in the order in which they come.’”

Donald Trump’s Election

Donald Trump’s 2016 election turbocharged the antitrust reform movement, extinguishing Democratic faith in Big Tech as a wholly benevolent actor and showing the possibility of a bipartisan movement.

Democratic candidate Hillary Clinton relied on high-tech algorithms and cutting-edge data models to provide her with what she thought would be an edge over Trump. Her loss, which those models failed to predict, also kept Big Tech figures like Facebook Chief Operating Officer Sheryl Sandberg and Google co-founder Eric Schmidt from further entwining themselves with the Democratic Party.

“This shattered the idea that these firms were on their side and magic sorcerers,” said Matt Stoller, director of research at the American Economic Liberties Project and author of “Goliath: The Hundred-Year War Between Monopoly Power and Democracy.” “Democrats started to see that [these firms are] not part of the progressive machine.”

Instead, Democrats began to view Facebook as a prime tool of the political right, home to Russian-sponsored troll farms and a place where false stories that boosted Trump’s candidacy spread.

For his part, Trump had made some noises on the campaign trail suggesting he was interested in toughening antitrust enforcement. In October 2016, Trump voiced his opposition to AT&T’s proposed merger with Time Warner. “It’s too much concentration of power in the hands of too few,” he said.

But Rob Porter, the White House aide charged with coordinating antitrust enforcement among agencies, resigned in February 2018 amid allegations of domestic abuse from two ex-wives. Some antitrust proponents believe his departure marked the end of the administration’s commitment to tougher enforcement.

Trump’s Department of Justice, led by antitrust chief Makan Delrahim, went on to fail in its effort to block the AT&T-Time Warner merger, which observers think scared Trump’s Justice Department away from adopting a more aggressive approach to antitrust actions.

“At the rhetorical level, they were very anti-monopoly. They were completely incompetent,” Lynn recalled. “They couldn’t achieve a thing, but their language was disruptive.”

A Think Tank In Exile

In June 2017, Open Markets, then housed at the New America Foundation, issued a statement congratulating the European Union’s antitrust authority for levying a $2.7 billion fine on Google for manipulating search results to favor its own companies.

Almost immediately, Schmidt, the Google co-founder and a major donor to New America, made his displeasure with the statement known to the foundation’s top brass. Two months later, New America ousted Lynn and his team, sending shockwaves through Washington.

Lynn and his colleagues got the last laugh, though. Reporting on the incident magnified their profile and helped convince the public that companies like Google ― with its doodles and “Don’t Be Evil” motto ― had a sinister side.

“It showed that Big Tech is no different than Big Tobacco or any other political group,” said Stoller, who worked at Open Markets at the time.

Despite the burst of publicity, the anti-monopoly advocates knew that their cause was not the kind that would inspire rank-and-file activists to take to the streets. They focused instead on courting members of Congress, their aides and, eventually, presidential candidates in private meetings and through a steady stream of essays, news articles and books written in language that ordinary people could understand.

Critically, though, the new anti-monopoly movement did not limit its attention to Democrats. Its leaders emphasized that they sought to restore healthy competition to American markets rather than limit it; they were champions of a fairer form of American capitalism, rather than being socialists.

“We worked really hard to keep the doors open and communications open with the Trump administration on these issues,” Lynn said. “If we allow the corporations to play parties off one another, we’re going to lose.”

It hasn’t hurt that the movement has the support of a number of major corporations, such as Yelp, that feel pushed around by Big Tech. And News Corp, Fox News’ parent company, has been at odds with Google and Facebook for years, insisting on a larger cut of ad revenue from content featured on those platforms and supporting a Justice Department lawsuit against Google.

“They’re pretty savvy,” a Republican Senate aide, who requested anonymity to speak without authorization, said of the antitrust crusaders. “It’s political smarts, but they also just have their eye on the ball and want to accomplish as much as anyone else does.”

So while Sen. Amy Klobuchar (D-Minn.), head of the Senate Judiciary Committee’s antitrust subcommittee, and Rep. David Cicilline (D-R.I.), her counterpart in the House, have led the charge against corporate concentration, they have had a supporting hand from figures like Sen. Josh Hawley (R-Mo.) and Rep. Ken Buck (R-Colo.), the ranking Republican on Cicilline’s subcommittee.

Although Buck and others profess concern about the effects of modern-day monopoly power on the American economy, the perception among Republican voters that major tech companies are biased against conservatives has given them, at minimum, an additional layer of political cover.

Amazon’s decision to expel Parler, a social media site popular among conservatives, from its web hosting services days after the Jan. 6 riot at the U.S. Capitol, effectively shutting the site down, was particularly radicalizing.

Mobile device showing the conservative Parler website with a statement about "Technical Difficulties" following the app's removal from its former Amazon hosting platform on Jan. 21. The site's removal after the U.S. Capitol riot reinforced conservatives' belief that Big Tech leans liberal.
Mobile device showing the conservative Parler website with a statement about "Technical Difficulties" following the app's removal from its former Amazon hosting platform on Jan. 21. The site's removal after the U.S. Capitol riot reinforced conservatives' belief that Big Tech leans liberal.
Smith Collection/Gado via Getty Images

“There is this real sense that these major corporations, the most powerful financial institutions in the country, are leaning left,” said Pedro Gonzalez, a fellow at the conservative Claremont Institute think tank who identifies as a right-wing populist. “This kind of stuff does breed a real enmity culminating in a desire for antitrust action ― taking a hammer to Amazon and smashing it to pieces.”

Shoring Up The White House

When the 2016 Democratic presidential primary kicked into gear, Lynn and his colleagues were delighted to see a kind of antitrust policy race to the top among the vast majority of serious contenders.

Sens. Warren, Klobuchar, Cory Booker (D-N.J.) and Bernie Sanders (I-Vt.) all embraced antitrust policy as a core part of their platforms, pitching it as a way to connect with farm country voters in Iowa tired of being pushed around by the big seed sellers and grain purchasing monopolies.

When HuffPost and the Open Markets Institute co-hosted a presidential candidate forum devoted to rural policy issues in Storm Lake, Iowa, in March 2019, five declared and prospective candidates attended: Warren, Klobucher, former Housing and Urban Development Secretary Julián Castro, Rep. Tim Ryan (D-Ohio) and then-Rep. John Delaney (D-Md.).

Biden was not there. He wasn’t in the race yet. After launching his campaign in May, he delivered a decidedly noncommittal answer when asked about splitting up Facebook, telling The Associated Press it was “something we should take a really hard look at,” while allowing that Warren had made a “very strong case.”

The anti-monopolists would get to make that case further. While Biden rarely discussed antitrust policy on the campaign trail, Lynn said Biden’s team was receptive to their recommendations in private meetings.

After Biden’s victory, Lynn emailed an essay he wrote for Washington Monthly about how the administration should approach antitrust issues to two dozen people in Biden’s policy orbit, including Gene Sperling, Jason Furman, Janet Yellen, David Lipton, Gary Gensler, Ron Klain, Bruce Reed and Heather Boushey.

Although many of those officials had served in the Obama administration, the mere existence of a network of White House advisers who had grown receptive to the new anti-monopoly agenda was a night-and-day contrast with the Obama era, according to Lynn.

“In the Obama administration, how many people could we send it to? There was nobody,” Lynn said.

Still, when the presidential transition began in late 2020, it was far from clear if Biden would fill his administration with anti-monopolists or take a status quo approach. But a team-up effort from progressives and conservatives would ultimately knock out contenders with ties to big tech.

Attorney General Merrick Garland ― whom proponents of tougher antitrust enforcement see as an obstacle to their goals ― originally wanted to appoint Susan Davies, who had defended Facebook from a 2012 Justice Department lawsuit, to the antitrust job. An article in The American Prospect outlining Garland’s push raised progressive hackles.

In February, during Garland’s confirmation hearing, Hawley pressed Garland about his support for Davies ― a moment even progressive antitrust activists saw as key.

“Do you think it’s appropriate to have someone who is a defender of these massive corporations leading the antitrust division?” Hawley asked.

After insisting that Davies’s background was not relevant because of the DOJ’s recusal protocols, Garland flatly denied that Davies was under consideration. “It turns out that the press reports are completely incorrect,” he said. “I don’t think either she or I have aspirations for her to be in the antitrust division.”

In the end, it would be Kanter, not Davies or anyone else seen as sympathetic to Big Tech, who would be named to lead the antitrust division.

Beyond Big Tech

The executive order Biden issued earlier this month went well beyond the tech companies, directing federal agencies to take aim at concentration in the agriculture industry and among hospitals. The provisions Biden has seemed most fired up about were ones designed to make everyday expenses ― hearing aids, prescription drugs, broadband internet ― lower and to enable workers to find higher wages.

“The antitrust of the last 30, 40 years has been abstract,” said Tim Wu, a leading antitrust thinker who is now a senior adviser to the National Economic Council. “A key part of bringing the executive order into existence was the intellectual turn of antitrust from just being about price theory to being about workers and small businesses.”

Biden, for instance, has repeatedly pointed to fast-food companies requiring their employees to sign non-competition agreements that bar them from jumping to work for rival companies as an outrage.

President Joe Biden talks about "promoting competition in the American economy" during a White House event on July 9.
President Joe Biden talks about "promoting competition in the American economy" during a White House event on July 9.
Alex Wong/Getty Images

“An economist would call that monopoly power expressed through contractual practices,” a White House official said. “But I think President Biden would just call it ‘screwing the middle class.’”

Bharat Ramamurti, a former top aide to Warren who is now deputy director at the National Economic Council, NEC staffer Hannah Gardon-Monheit and Wu teamed up to author the sweeping order, which contained 72 provisions touching on a dozen government agencies. Progressives also credited NEC Director Brian Deese and White House deputy chief of staff Bruce Reed ― two thinkers who are not typically favorites of the Democrats’ left wing ― with playing key roles in developing the order.

Anti-monopoly sentiment seems to have spread broadly throughout Biden’s administration. When Biden picked former Iowa Gov. Tom Vilsack to lead the Department of Agriculture, progressives despaired. During his previous tenure as agriculture secretary during the Obama administration, he faced criticism for standing by and doing little as a wave of corporate concentration hit the agriculture industry.

During his second go-round in the job, Vilsack has adopted a more aggressive posture, hiring a liberal thinker ― former Center for American Progress fellow Andy Green ― to fill a new job as a senior adviser for fair and competitive markets. It’s one of several steps that’s left once-skeptical advocates cautiously optimistic about his tenure.

“We’re going to continue to put pressure and continue to be a watchdog on the actions of this administration, both in Vilsack as well as at the White House,” said Joe Maxwell, a former lieutenant governor of Missouri who is now the president of Family Farm Action. “But right now it looks like they have a plan and they’re moving. They’re moving their chess pieces in the right direction.”

More Work To Do

There is still a lot for the anti-monopolists to do to turn their intellectual victory into real policy. Much of Biden’s executive order consisted of instructions to independent agencies that are free to ignore the wishes of a president. Resistance to strong antitrust action still exists within both parties on Capitol Hill.

In June, the House Judiciary Committee advanced six of Cicilline’s and Buck’s bills cracking down on Big Tech. The raft of legislation ranges from a bill allowing state attorneys general to keep antitrust cases in a court of their choosing, rather than one sought by the defendant, to a bill prohibiting “dominant” tech platforms from purchasing competitors as a way of neutralizing them. Another bill forbidding dominant tech platforms from using their power across different business sectors to give their own products preferential treatment would likely force major tech companies to spin off arms of their business.

The bills have elicited outspoken opposition from members of both parties, however, suggesting that chances of passage on the House floor are unlikely. Members of Congress from California, where some of the biggest tech companies are headquartered, have been especially critical of the legislation, with progressives like Reps. Zoe Lofgren (D) and Ro Khanna (D) joining conservative Reps. Darrell Issa (R) and Tom McClintock (R) in opposition.

Rep. Jim Jordan (R-Ohio), who has received $43,000 from Google’s PAC over his career, has argued that legitimate grievances with the technology platforms’ censorship of conservative content is not a reason to pursue far-reaching regulation of Silicon Valley companies.

And defenders of the old style of antitrust thinking are starting to fight back. While their efforts to block Kanter’s and Khan’s appointments were ham-fisted ― a tech-funded group that hoped to reach out to progressives was headed by a Google lobbyist who was a close friend of Sen. Tom Cotton (R-Ark.) ― progressives know it’s far too early to consign Bork’s thinking to the dustbin of history.

Bork’s son, for instance, has been trying to convince the members of the GOP who supported Khan and are allying themselves with anti-monopolists that they are making a historic mistake. The alliance is poised to “destroy the American free-market system,” Robert Bork Jr. wrote in a National Review op-ed earlier this month.

And given the longevity of the Bork antitrust school, it is also unlikely to disappear from the federal judiciary overnight. Any president going up against Big Tech and other concentrated industries is liable to come up against judges more sympathetic to the arguments of dominant companies than to the government lawyers challenging them.

Still, the Biden administration’s embrace of antitrust thinking is already bearing fruit: The Justice Department’s opposition to a $30 billion merger of two insurance giants forced them to abandon the merger on Monday, something Garland praised as a victory for competition and a way to keep health insurance costs down.

Preventing more concentration from taking root is just the tip of the iceberg for the new antitrust crusaders, however. They envision a future where the government has significantly curtailed the power of the existing corporate behemoths, not least in Big Tech.

“Success is a world in which we don’t talk about [Amazon founder] Jeff Bezos every day,” Lynn said. “He’s less powerful. He’s less important. We don’t care about him.”

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