14 Jun The Offensive Against America’s Champions; The Abortion/Anti-Abortion Cycle*
The Offensive Against America’s Champions
Facebook, Amazon, Apple and Google/Alphabet are America’s capitalist champions most notorious monopolies. They should be broken into their component parts just like the Justice Department did with AT&T in 1984. That dismemberment gave America eight telecommunications companies that could compete not only in telecommunications, but also in computers, television and cutting-edge technology. That should be an example for America to follow today.
Not so.
Not by any measure.
The hoped-for benefits of the AT&T break-up were ephemeral are difficult to see today. There was no subsequent telecommunications competition frenzy – the Baby Bells eventually rearranged themselves into three weaker survivors (AT&T, Verizon and CenturyLink). Consumers saw an increase in local telephone rates and the government proceeded to regulate long-distance access. The break-up, intended to invigorate the computer and technology industries, did neither. No Baby Bell survived as a computer company or as a technology incubator. One often overlooked consequence of the sundering of AT&T downsized was the elimination of a possible telecommunications national champion. So-called “monopolist AT&T” ceased to exist and no Baby Bell was able to replace it … and to thereby compete with the telecommunications giant – namely Huawei.
Both the Democrats and Republicans nevertheless are arguing that dismemberment of Big Tech is in America’s best interest. Each Party of course approaches that conclusion from a different perspective. President Trump believes the tech giants are using their powerful platforms to aid the Democratic Party and discriminate against him, saying that they have “hatred [for] certain … people that happen to be in power.” Other Republican leaders, notably Ted Cruz, echo that view. Elizabeth Warren argues that “these [high tech] companies have grown larger and more powerful [and are using] their resources and control … to squash small businesses and innovation, and substitute their own financial interest for the broader interests of the people.” Trump and his Republican fellow-travelers apparently are concerned only with their own public image … and their re-election, and Warren and her fellow-travelers apparently are concerned only with furthering their regulatory agenda … and winning the next election. Neither appreciate that they are proposing to defenestrate destroy America’s capitalist ethic most successful industry, dismembering and/or regulating this Century’s capitalist champions, poster children for the American Dream. America’s high tech businesses have shown Americans what makes America great. And, yet, those American champions apparently have no political champions – it’s difficult to find a politician in either Party advocating the benefits of laissez-faire capitalism when it comes to Big Tech. As Warren neatly summarized for both Parties: “To restore the balance of power in our democracy, to promote competition, and to ensure that the next generation of technology innovation is as vibrant as the last, it’s time to break up our biggest tech companies.” Seconding Warren’s call to government intervention, Cruz believes that “giant tech companies today are larger, and more powerful, than Standard Oil was when it was broken up. And if we have tech companies using the powers of monopoly to censor political speech, I think that raises real antitrust issues.”
In the heart-breaking words of the Wicked Witch of the West, “What a world. What a world! Who would have thought …?”
As intended by both Parties, the offensive against Big Tech is gathering momentum. The Department of Justice reportedly is investigating Apple and Alphabet/Google, and the Federal Trade Commission is investigating Amazon and Facebook. The House Judiciary Committee is in the process of “a top-to-bottom review of the market power held by giant tech platforms.”
The attacks on Big Tech focus on their monopoly power, their inability disinterest in safeguarding their users’ data, their alleged political agendas, and the fact that Big Tech is controlled by a relatively few Tech Barons who wield extraordinary power.
There is little to recommend in any of these pretexts arguments. To paraphrase Mona Lisa Vito, the case against Big Tech “doesn’t hold water.”
Insofar as monopolies are concerned, they are not themselves bad. They require government intervention only when they harm consumers – for example, when they use predatory pricing – or when they deploy strategies to block potential competitors from entering their markets – both of which are extraordinarily challenging in the 21st Century, an era packed with global competitors (as evidenced, for example, by Chinese technology national champions Alibaba, Tencent, JD.com and Baidu). It also is difficult to formulate a scenario in which the component parts of Big Tech companies would be of greater benefit to American consumers, or foster greater competition, than their larger parents.
Insofar as safeguarding users’ data, Stanley Druckenmiller has a simple remedy: “If you don’t like what Google is doing with privacy, don’t use Google.” He has a point. Moreover, America already has among the most stringent privacy laws in the world. It’s therefore difficult to see how more government regulation, or a break-up of the tech giants, would provide consumers with greater protection.
With respect to Big Tech’s political agendas, media companies (which include Big Tech) generate their revenue by appealing to users’ salacious interests scandals their political constituencies. That’s not only true of today’s Fox News and MSNBC. Political partisanship has been a prominent benefit component of free speech rights since America’s Revolutionary War. Notable media manipulators advocates of media partisanship included Alexander Hamilton and Thomas Jefferson. Yellow journalism provided the 19th Century with inflammatory, partisan reporting by both sides, frequently pitting the newspapers of William Randolph Hearst against those of Joseph Pulitzer (and local newspapers invariably favored one side or the other). Sensationalism, scandal-mongering, and exaggeration were the preferred tools used to instruct and shape the opinions of voters who, in that era, were too uninformed to be trusted with making the right choice based on facts alone. Have voters’ interest in facts materially changed? Drunkenmiller’s perspective: “President Trump, we all know his motivation…. Now, the Democrats hate [Big Tech] because they’re convinced that Facebook’s platform got President Trump elected.”
It undoubtedly is true that Big Tech is controlled by a few Tech Barons who very much pursue their own political agendas. That, too, is and has a long history in America’s democracy (for readers who are film buffs, Citizen Kane provides excellent context). Mark Zuckerberg, although owning only ~20{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} of Facebook stock, controls 51{29ea29b64b10057f61377b2c087cd5b7537a0cd24da4295a308b0bf589469f35} of Facebook’s vote … and many have objected to his disproportional control. However, this has been true since Facebook successfully went public … with that precise ownership structure. Facebook has generated outsized profits for those who made that investment. That’s how American capitalism works … and how it has been working for many decades. If today’s shareholders object to Facebook’s structure, they can readily sell their shares via a well-run, well-regulated stock market.
An excellent summary of why the attack on Big Tech is misplaced was (again) provided by Mr. Druckenmiller: “We are attacking our companies that are the leaders in [their industry and yet] we’re supporting our steel industry, our coal industry, [and] our aluminum industry. Way to think about the future…!”
The Abortion/Anti-Abortion Cycle
More than one reader of the June 10th TLR was alarmed by the possibility that Roe v. Wade might be reversed. A reversal would mean that a woman’s right to control her pregnancy would be trumped superseded by the interests of, and by determinations made by, the State.
This would not create a new American abortion or anti-abortion model. Government policies in America have swung from permissive to restrictive and from restrictive to permissive, from favoring women’s rights to eliminating and, at times, criminalizing them … and vice versa. The history of abortions, and of anti-abortion law, in America is replete with cycles of women’s rights majorities and anti-abortion majorities … both on local levels and nationally. Although laws most often were enacted on State-wide bases, enforcement more frequently was locality-specific.
Abortions during the early days of the American Republic were permitted as long as they were performed during the first 15-20 weeks of pregnancy (the period before a fetus began to move, believed in that era to be the first signs of life). Gradually, State-by-State, anti-abortion laws began finding favor, sometimes to protect women from poisons dangerous medicines and quackery unsafe medical practices, at other times to affirm male control, and at still other times by licensed physicians to prevent the practice of medicine by competing unlicensed doctors. By the second half of the-20th Century, the result was that the United States was a patchwork quilt of differing abortion laws, varying enforcement of those laws, and unpredictable inconsistent treatment of violators. What framed the issue for the public and, consequently for the courts, is often believed to have begun with an article in The Arizona Republic that publicized the effects that abortion laws had on poor women (focusing on the story of Sherri Finkbine), pointing out that women with insufficient means who sought abortions either had to resort to illegal abortion practitioners (or to self-induced, “coat hanger” abortions) or have unwanted children … while wealthy women had the means to travel to abortion-friendly jurisdictions.
A reversal of Roe v. Wade would likely lead to a similar “means bifurcation,” recreating the checkerboard of differing laws that existed in the mid-20th Century. (In this regard, it is notable that most of the States that recently enacted anti-abortion legislation are among the lowest in per capita income among the nation’s States.) It has been argued that the most likely grounds for reversal would be through a holding that, since the question of when life begins is not addressed in the U.S. Constitution, resolution of that question is properly reserved to each State – a States’ rights conclusion. Such an outcome would be consistent with a strict construction of the Constitution, an analysis advocated during and after the Roe v. Wade process. It also would further polarize Red and Blue States divide America. It would further establish the anti-American Constitutional right of majorities in each State to determine “right” from “wrong,” overriding the beliefs of minorities and dissenters in those States. Another possible holding would be the one advocated by many anti-abortion activists, that life begins at conception … or, perhaps, at a fixed date prior to the 24-28 months previously determined by the Court.
The Roe v. Wade controversy is likely to become more combative as the judicial process continues.
Finally (from a good friend)
*┬® Copyright 2019 by William Natbony. All rights reserved.
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