‘Big Step’ for Antitrust as FTC and State AGs Sue Facebook as Illegal Monopoly

‘Big Step’ for Antitrust as FTC and State AGs Sue Facebook as Illegal Monopoly

“Good,” said Congresswoman Alexandria Ocasio-Cortez.

By Jessica Corbett

In a coordinated attack following over a year of investigation, federal regulators and a coalition of nearly all state attorneys general filed a pair of lawsuits against Facebook on Wednesday, arguing that the social media giant has become an illegal monopoly and should not only be broken up but also face limits on future mergers so it can’t engage in any more alleged anti-competitive behavior.

“Instead of competing on the merits, Facebook used its power to suppress competition so it could take advantage of users and make billions by converting personal data into a cash cow.”
—New York Attorney General Letitia James

“For nearly a decade, Facebook has used its dominance and monopoly power to crush smaller rivals and snuff out competition, all at the expense of everyday users,” said New York Attorney General Letitia James in a statement. James is leading the state lawsuit (pdf), which is backed by the AGs of 45 other states—all but Alabama, Georgia, South Carolina, and South Dakota—as well as the District of Columbia and Guam.

“We are taking action to stand up for the millions of consumers and many small businesses that have been harmed by Facebook’s illegal behavior,” she said. “Instead of competing on the merits, Facebook used its power to suppress competition so it could take advantage of users and make billions by converting personal data into a cash cow.”

Noting that “almost every state in this nation has joined this bipartisan lawsuit because Facebook’s efforts to dominate the market were as illegal as they were harmful,” James added that the suit “should send a clear message to Facebook and every other company that any efforts to stifle competition, reduce innovation, or cut privacy protections will be met with the full force of our offices.”

Filed in U.S. District Court for D.C., the state complaint explains that “users do not pay a cash price to use Facebook,” a social media platform launched in 2004 by chairman, CEO, and controlling shareholder Mark Zuckerberg. “Instead, users exchange their time, attention, and personal data for access to Facebook’s services.”

As the complaint details:

Facebook makes its money by selling ads. Facebook sells advertising to firms that attach immense value to the user engagement and highly targeted advertising that Facebook can uniquely deliver due to its massive network of users and the vast trove of data it has collected on users, their friends, and their interests. The more data Facebook accumulates by surveilling the activities of its users and the more time the company convinces users to spend engaging on Facebook services, the more money the company makes through its advertising business.

The state AGs charge that “Facebook has had monopoly power in the personal social networking market in the United States” for almost a decade, and the company “illegally maintains that monopoly power by deploying a buy-or-bury strategy that thwarts competition and harms both users and advertisers.”

Both the state case and the new lawsuit (pdf) filed Wednesday by the Federal Trade Commission (FTC) in the same court draw attention to Facebook’s acquisitions of the photo-sharing platform Instagram in April 2012 for $1 billion and the messaging service WhatsApp in February 2014 for nearly $19 billion.

“Today’s enforcement action aims to restore competition to this important industry and provide a foundation for future competitors to grow and innovate without the threat of being crushed by Facebook,” FTC Bureau of Competition Director Ian Conner said in a statement. “The commission’s requested relief includes unwinding Facebook’s prior acquisitions of Instagram and WhatsApp, and barring Facebook from engaging in additional anti-competitive practices that have helped it dominate the personal social networking market.”

After acknowledging the cooperation with the states, Conner added that “the American public deserves a competitive and vibrant personal social networking market, and we are taking this action to restore the competitive vigor necessary to foster innovation and consumer choice.”

As the Washington Post reported Wednesday:

Facebook, for its part, has mounted a massive lobbying offensive to try to rebut the allegations. Publicly, the company and its chief executive, Mark Zuckerberg, have sought to stress that Facebook’s purchases of Instagram and WhatsApp helped them grow into viable services in a larger market where newcomers, such as TikTok, are still able to thrive.

“A strongly competitive landscape existed at the time of both acquisitions and exists today,” spokesman Chris Sgro said in a statement in October. “Regulators thoroughly reviewed each deal and rightly did not see any reason to stop them at the time.”

According to Alex Harman, competition policy advocate for the consumer advocacy group Public Citizen, “These lawsuits mark an important turning point in the battle to rein in Big Tech monopolies and to reinvigorate antitrust enforcement.”

“Facebook is absolutely an out-of-control monopoly—one that has abused its market power to squash competition, manipulate democracies, and crush journalism.”
—Rep. Alexandria Ocasio-Cortez

“What started as a nascent academic idea supported by a small coalition fighting for economic justice has become the official policy of American antitrust enforcers,” Harman said. “We welcome this action and look forward to more aggressive antitrust enforcement actions against other Big Tech monopolists, as well as those in other industries.”

The long-anticipated filings against Facebook—which follow an antitrust suit against Google brought by the U.S. Justice Department and several states in October—were also applauded in a statement from Demand Progress executive director David Segal and the Revolving Door Project executive director Jeff Hauser.

The company’s acquisitions of Instagram and WhatsApp as well as “other anti-competitive activities have allowed Facebook to wield too much power over the social internet, online discourse, and our broader society,” Segal and Hauser said. “Authorities never should have allowed these mergers, nor Facebook’s other anti-competitive conduct, but a revolving door between regulators and industry helped create a culture of non-enforcement that has lasted for decades.”

“The effects of this revolving door extend far beyond Facebook, or even Big Tech—they can be seen in our highly concentrated agricultural sector, airline sector, financial sector, and more,” they added. “We are glad that advocates and authorities across the country have begun to recognize the democratic imperative of ending concentrated economic power. In the case of Big Tech firms like Facebook, Google, and Amazon, the power they wield over the internet, the economy, our government, and broader society has had an incalculable impact.”

Segal and Hauser also recognized President-elect Joe Biden’s victory over Donald Trump last month. Looking ahead to Biden’s planned January 20 inauguration and beyond, they urged the incoming administration to “make it clear that it also understands the dangers posed by concentrated corporate power, and the harms caused by Facebook and other monopolistic firms.”

“Biden must ensure that the cases against both Google and Facebook will continue under his presidency, and that his administration shall pursue a vigorous anti-monopoly policy across all economic sectors,” they said. “The first step to building trust on this issue will be for Biden to keep top executives, lobbyists, and consultants for Big Tech and other corporations out of his administration.”

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Source: ‘Big Step’ for Antitrust as FTC and State AGs Sue Facebook as Illegal Monopoly | Common Dreams News

‘This Is Atrocious’: Trump White House Proposes Covid Relief Plan With $0 Weekly Unemployment Boost

‘This Is Atrocious’: Trump White House Proposes Covid Relief Plan With $0 Weekly Unemployment Boost

“The president’s proposal starts by cutting the unemployment insurance proposal being discussed by bipartisan members of the House and Senate. That is unacceptable.”

By Jake Johnson

The Trump White House late Tuesday tossed into the middle of ongoing coronavirus relief negotiations a $916 billion proposal that includes one-time $600 stimulus payments in the place of a weekly boost to federal unemployment benefits, a trade-off that Democratic lawmakers and economic analysts immediately rejected as unconscionable.

Offered as Democratic and Republican negotiators are racing to strike a relief deal before year’s end, the White House plan would provide $40 billion for an extension of federal unemployment programs set to expire on December 26—but no increase in weekly benefits, despite the dire state of the economy.

“We gave the biggest help to those who needed it. The Republicans would send one $600 check and that’s it. This is atrocious.”
—Rep. Don Beyer

The Trump administration’s unemployment insurance plan, put forth by Treasury Secretary Steve Mnuchin, falls well short of a bipartisan framework that calls for $180 billion in funding to boost unemployment benefits by $300 per week through March.

“The president’s proposal starts by cutting the unemployment insurance proposal being discussed by bipartisan members of the House and Senate from $180 billion to $40 billion,” House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) said in a joint statement. “That is unacceptable.”

As a substitute for the lack of a weekly unemployment boost, the White House proposed a round of direct stimulus payments amounting to $600 per adult and $600 per child.

By contrast, the $2.2 trillion CARES Act that Congress approved in March sent one-time payments of $1,200 per adult and $500 per child to most U.S. households, on top of a $600-per-week unemployment supplement that proved remarkably successful until Republicans allowed it to lapse at the end of July.

“We gave the biggest help to those who needed it,” Rep. Don Beyer (D-Va.) said of the CARES Act. “The Republicans would send one $600 check and that’s it. This is atrocious.”

Andrew Stettner, a senior fellow at The Century Foundation, noted that “unemployed workers are going thousands in dollars in debt on paltry benefits.”

“Stimulus checks are not a substitute,” said Stettner, a sentiment echoed by other analysts.

With hiring slowing sharply as coronavirus infections rise nationwide, economists have warned that failure to approve a weekly unemployment boost would heighten the misery already being felt by tens of millions of people across the U.S. According to recent data, around 20 million Americans are currently receiving some form of unemployment insurance, 26 million are struggling to afford enough food, and 40 million could face eviction in the near future.

“The expiration of vital pandemic unemployment insurance (UI) benefits on December 26 will leave 12 million workers without a safety net, and over four million others will have already exhausted their benefits by this cutoff,” Elise Gould, senior economist at the Economic Policy Institute, wrote in a blog post last week. “This spells trouble not only for workers and their families who are desperately trying to keep a roof over their heads and put food on the table—especially with the eviction moratorium also set to expire on December 31—but also for the recovery itself.”

“The longer Congress waits to act, the more permanent damage will be done to American families and the overall economy.”
—Dr. Mark Paul, Dr. Adam Hersh

In addition to being dramatically less ambitious than the CARES Act, the White House’s new proposal and the bipartisan plan embraced as a starting point by Democratic leaders are both a far cry from the kind of bold stimulus that experts say is needed to prevent a prolonged recession and ensure a just recovery.

A paper (pdf) authored by economists Dr. Mark Paul and Dr. Adam Hersh and released Tuesday by the Groundwork Collaborative estimates that “Congress needs to provide economic relief of between $3-4.5 trillion in the short-term in order to get American families and businesses working at their full potential.”

“This would include continuing to expand eligibility for unemployment insurance benefits, renewing the $600 weekly supplemental benefits, providing fiscal aid to offset budgetary pressures on state, local, and tribal governments, renewal and better management of the Paycheck Protection Program for small businesses, and resources to expand Covid testing and tracing and health insurance subsidies, among other measures,” the economists wrote.

“The longer Congress waits to act,” they warned, “the more permanent damage will be done to American families and the overall economy, and the harder it will be for the U.S. economy to regain prosperity.”

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Source: ‘This Is Atrocious’: Trump White House Proposes Covid Relief Plan With $0 Weekly Unemployment Boost | Common Dreams News

Sanders Leads Senate Demand for $1,200 Stimulus Checks Over ‘Get-Out-of-Jail Free Card’ for Corporations

Sanders Leads Senate Demand for $1,200 Stimulus Checks Over ‘Get-Out-of-Jail Free Card’ for Corporations

“The American people need help and they need help now.”

By Jake Johnson

Rejecting the bipartisan coronavirus relief plan currently under negotiation on Capitol Hill as “totally inadequate,” Sen. Bernie Sanders and five Democratic senators circulated a letter Tuesday calling on their fellow lawmakers to join them in demanding the inclusion of another round of direct stimulus payments and the removal of all corporate-friendly poison pills.

“Simply stated, given the horrific extent of the current crisis and the desperation that working families all over this country are experiencing, this proposal does not go anywhere near far enough,” reads the letter (pdf), which was coordinated by Sanders and backed by Sens. Elizabeth Warren (D-Mass.), Ed Markey (D-Mass.), Kirsten Gillibrand (D-N.Y.), Ron Wyden (D-Ore.), and Jeff Merkley (D-Ore.).

“Please join us in demanding that any new Covid relief proposal includes a $1,200 direct payment to adults and $500 to their children.”
—Letter

Noting that the bipartisan plan only calls for $348 billion in new funding—a far cry from the $2.2 trillion CARES Act Congress approved in March—and includes a “get-out-of-jail free card to companies that put the lives of their workers and customers at risk,” the senators warn it “would be unacceptable to take a major step backwards” as coronavirus cases, hospitalizations, and deaths surge nationwide and economic conditions continue to deteriorate.

“Unlike the CARES Act… this proposal only provides a $300 supplement for unemployed workers rather than $600 a week,” the lawmakers note. “Further, unlike the $1,200 direct payment for every working class individual and $500 for each child, it provides absolutely no direct payment.”

The White House is urging Senate Republicans to push for the inclusion of $600 stimulus checks in the relief bill, the Washington Post reported Tuesday.

“The American people need help and they need help now,” the senators’ letter continues. “We agree with President-elect Biden that a $1,200 direct payment should be included in this proposal. We also feel strongly that we should not provide immunity to corporations who endanger the health and lives of their employees. Please join us in demanding that any new Covid relief proposal includes a $1,200 direct payment to adults and $500 to their children. Further, please work with us to make certain that there is no language in this bill to give a liability shield to corporations.”

Growing progressive criticism of the bipartisan stimulus proposal first unveiled last week comes as Senate Majority Leader Mitch McConnell’s (R-Ky.) demand for a five-year liability shield for corporations—a top priority of many congressional Republicans—is threatening to completely derail ongoing relief talks.

If lawmakers don’t pass a legislative fix before the end of the year, dozens of key federal programs—including unemployment insurance, paid sick and family leave, and an eviction moratorium—will expire, leaving millions of Americans in the lurch.

Lisa Gilbert, executive vice president at consumer advocacy group Public Citizen, said in a statement Tuesday that “unemployment insurance, aid for hospitals, and state and local assistance should not be held hostage to McConnell and the Senate Republicans’ quest for corporate immunity.”

“We are down to the wire as the opportunity to attach the stimulus to the end of year spending deal winds down,” Gilbert added. “Lawmakers should continue to reject any package that includes this deadly corporate giveaway and move with haste to finish the negotiations.”

Read the senators’ full letter:

Dear Colleague:

As you know, the Covid-19 pandemic is surging throughout the country and is now causing more pain and havoc than at any time since it began. Last week, an average of almost 200,000 Americans a day were diagnosed with Covid-19 and, tragically, over 2,000 people are now dying every single day.

Further, as a result of the pandemic, we are now experiencing the worst economic crisis since the Great Depression. Over half of our workers are living paycheck to paycheck and one out of four workers are either unemployed or make less than $20,000 a year. In addition, 92 million Americans are uninsured or under-insured, tens of millions of people face eviction and hunger in America is exploding.

We very much appreciate the hard work that has gone into the current $908 billion proposal being drafted by a number of Democratic and Republican senators. But, simply stated, given the horrific extent of the current crisis and the desperation that working families all over this country are experiencing, this proposal does not go anywhere near far enough. In truth, rather than the $3.4 trillion which we Democrats called for in the HEROES Act, this bill only allocates $348 billion in new money according to one of the lead Republican negotiators. The remaining $560 billion are funds transferred from the CARES Act that have not yet been obligated.

Unlike the CARES Act, which we passed in March, this proposal only provides a $300 supplement for unemployed workers rather than $600 a week. Further, unlike the $1,200 direct payment for every working class individual and $500 for each child, it provides absolutely no direct payment.

Moreover, this proposal does nothing to address the healthcare crisis impacting tens of millions of Americans who cannot afford medical care and has totally inadequate financial assistance for the most vulnerable.

Further, despite long-time Democratic opposition, it is our understanding that this proposal may provide 100 percent legal immunity to corporations whose irresponsibility has led to the deaths of hundreds of workers. It would continue to provide a get-out-of-jail free card to companies that put the lives of their workers and customers at risk. In fact, the result of this proposal is that, through this liability provision, corporations will be encouraged to avoid implementing the common sense safety standards needed to protect workers and consumers—and make a bad situation worse.

We agree with the AFL-CIO and the 141 organizations who oppose providing this kind of immunity to corporations. According to a letter these groups sent to Senators on December 4th: “Granting immunity would make the country less safe at the exact moment when the Covid-19 pandemic is entering a new, dangerous phase.”

Last March, with unanimous support in Congress, President Trump signed the $2 trillion CARES Act into law that provided a $600 a week supplement in unemployment benefits and a $1,200 direct payment to every working class adult, $500 per child and significant help for small businesses, states and cities. In October, as part of the negotiating process, the Trump administration and a bipartisan coalition in the House supported over $1.8 trillion in Covid relief that also included another $1,200 direct payment.

Given the enormity of the crisis today, it would be unacceptable to take a major step backwards from those previous efforts by passing legislation that only included $348 billion in new money.

The American people need help and they need help now. We agree with President-elect Biden that a $1,200 direct payment should be included in this proposal. We also feel strongly that we should not provide immunity to corporations who endanger the health and lives of their employees.

Please join us in demanding that any new Covid-relief proposal includes a $1,200 direct payment to adults and $500 to their children. Further, please work with us to make certain that there is no language in this bill to give a liability shield to corporations who threaten the health and safety of workers and customers.

This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.

Source: Sanders Leads Senate Demand for $1,200 Stimulus Checks Over ‘Get-Out-of-Jail Free Card’ for Corporations | Common Dreams News