Keeping Big-Tech Intact
Originally published in The Daily Comet on July 18, 2019 by Gwayne Gautreaux
For years government has used smoke and mirrors to influence market outcomes in the name of protecting participants from the ill-effects of economic externalities. There is no better example of the way in which government has sought to exert control on the private sector than by using anti-trust laws, supposedly aimed at breaking up monopolies.
It isn’t that government should disregard policies that seek to discourage monopolistic behavior. However, instead of government reinforcing the market as an instrument of competition, it has induced the conditions that are favorable for monopolies to develop. Government and corporate entities have effectively been able to form coalitions that suppress competition, by politicians granting business elites the privilege of writing the parameters that regulate the very same industries to which these corporations belong. One would be hard-pressed to find any condition under which monopolies have formed, that have done so without the help of government.
On the contrary, the internet is a good example of an industry that has been allowed to proliferate with minimal regulation, resulting in maximal efficiency and innovation. Yet government is constantly seeking to dismantle the very same tech syndicates who have helped create the internet revolution to which the majority of people have benefited from.
The Department of Justice and other federal bureaucrats claim that industry dominance and massive market capitalization are the reasons why tech titans like Google, Facebook, and Amazon have fallen into political cross-hairs. However, market-size shouldn’t unilaterally constitute anti-trust regulation if there are no ill-effects of market dominance that exists. The forces that characterize a true monopoly result from the outcome of one firm hijacking the market, siphoning off competition, artificially inflating prices, and reducing output quality…..none of which exists in the tech industry.
No one denies that Google has achieved “internet hegemony”, but the conditions that reflect the state of internet-search in no way constitutes anti-trust regulation. There are no harmful side-effects that accompany Google’s dominance. In the first place, Google has revolutionized the way users explore data, cataloging the web as efficiently as anyone. Secondly, they continue to add utilities that significantly improve user-experience, all without any cost to consumers. Moreover, because technology has been devoid of heavy regulation, there is still internet-search participation from competitors like Bing, Yahoo, and Duck-Duck-Go, just to name a few.
Facebook is another high-profile target of government regulation similar to Google. Government believes that social media needs to be protected from the control that Facebook has on the market. Yet, even with Facebook’s social-media-presence there have been no harmful consequences within the social-networking domain. Facebook has developed unprecedented ways to interact without any added costs, none of which have been to the detriment of competition. Additionally, networking outlets like Twitter, Snapchat, and LinkedIn offer reputable alternatives to Facebook.
Amazon is another company who has also remained in government’s line of sight. Yet, Amazon has revolutionized online retail shopping by offering speed, convenience, and choice for their users with minimal costs. Although Amazon has a large share of the e-commerce market, online shoppers continue to experience quality service without added pricing. Furthermore, other online retailers exist as an option to Amazon.
Thus, like Facebook and Google, Amazon’s online presence has produced more benefits than costs.
Although the tech triad of Google, Facebook, and Amazon share much of the same commercial success, the industries they have come to “dominate” all continue to operate with efficiency, innovation, and with minimal costs to end-users. Lawmakers typically initiate anti-trust measures for the benefit of protecting consumers against unfair pricing and lack of choice. Seeking to dismantle businesses entirely on the basis of market dominance, especially in the absence of monopolistic effects, would only serve to punish success and productivity.
