About the author: Eric Peterson is the director of the Center for Technology and Innovation Policy at the Pelican Institute for Public Policy in New Orleans, Louisiana’s free-market public policy think tank.
Recently, Attorney General Bill Barr joined attorneys general from 11 other states, including Louisiana, in releasing their much-anticipated antitrust lawsuit against Google.
The 64-page lawsuit lays out a series of claims against Google for its alleged violation of American antitrust laws. The central claim asserts that Google has a monopoly on general internet searches, resulting in higher ad prices and a worse consumer experience. This complaint and others in the lawsuit require some skepticism.
One example of the core complaint not meshing with reality is the fact that online ad prices have declined by 40 percent over the last decade, while prices in other forms of advertising have increased. These sorts of flawed assertions combined with partisan statements signal that perhaps politics, not consumer welfare, seems to be a driving factor for this investigation.
Antitrust laws have a long but confusing history in America. Ever since they were enacted, the exact standards that should be applied to determine if a company was a monopoly were hazy at best. This lack of clarity gifted judges with broad latitude to substitute their political preferences for the rule of law. Thankfully, the consumer welfare standard revolution in the 1970s created a standard which continues to benefit all Americans today.
But, the Google case appears to be a retreat from this legal revolution. Statement after statement from lawmakers and other political officials heavily focus on the fact that “Big Tech” is out to get conservatives. They make claims about the company that are unrelated to the facts of the lawsuit. At the same time, they contend the lawsuit is a way to reign in the power of Big Tech, regardless of if consumers are being harmed or not.
This usage of antitrust harkens back to the time before the consumer welfare standard was in place, and that should concern all Americans. One side of the political aisle wielding government power as a cudgel to punish perceived political foes can, with one election, be easily punished with this same power. With the election less than two weeks away, Americans should be more skeptical than ever of the government using its political power against companies it doesn’t like.
The New York attorney general’s office is a particularly egregious offender of this practice, often using its power for political purposes. And while the office’s lawsuits against entities ranging from energy companies to the National Rifle Association have been without merit, the lawsuits still caused those groups millions in legal fees and potential reputational damage.
The case against Google seems to be no different. Even if the company is able to prove it hasn’t been acting as a monopoly, the case will likely take years and cost millions. In a way, the process is the punishment.
We live in an especially partisan time, with incredibly close races occurring across the country. But one question that should never be on the ballot is whose perceived political enemies might be on the wrong side of an antitrust investigation.
The move away from political considerations to our consumer welfare standard has been championed as one of the great bipartisan legal victories of the last half century. Consumers have seen incredible innovation and lower prices in dozens of industries while still being protected from monopolies. The investigation against Google potentially signals a troubling trend, and it’s one policymakers on both sides of the aisle should reject. After all, no one party holds power forever.