Elizabeth Warren would break up big tech companies
WASHINGTON — Senator Elizabeth Warren proposed Friday to break up some of the nation’s biggest technology companies, casting Google, Amazon, Facebook, and others as the newest villains in the scathing picture of capitalism run amok that has framed her political rise and her presidential run.
“They’ve bulldozed competition, used our private information for profit, and tilted the playing field against everyone else,” Warren wrote in a 1,700-word online post detailing her plan, which would reverse major tech mergers and break up companies, including Apple, that currently operate a marketplace or platform and participate in it.
“We need to stop this generation of big tech companies from throwing around their political power to shape the rules in their favor and throwing around their economic power to snuff out or buy up every potential competitor,” Warren wrote.
The proposal expands Warren’s economic platform, adding new policy details about a thoroughly modern concern — the power of the corporate giants whose technology is behind online retail, media consumption, and communication for millions of Americans — to her broadsides against bankers and the ultra wealthy.
“It’s a logical next step for someone who has made her career taking on corporate monopolies and power,” said Jesse Ferguson, a Democratic strategist who worked on Hillary Clinton’s 2016 presidential campaign.
But tech was already poised to be something of a flashpoint in the 2020 election, with industry giants facing growing scrutiny in Washington about their size and power in the market, handling of misinformation on their platforms, and the way they use and profit from customers’ private data.
Amy Klobuchar, the Minnesota senator, called for new privacy regulations for tech companies when she announced her run for the Democratic presidential nomination. Senator Bernie Sanders, the economic populist from Vermont who jumped into the presidential primary last month, has decried Amazon’s treatment of its workers. Other Democratic candidates, including Cory Booker, the New Jersey senator, have faced criticism for having closer ties to Silicon Valley.
Warren is attempting to stake a claim on the issue by being first with a detailed plan.
“It certainly puts pressure on a host of candidates to address the issue,” said Mark Longabaugh, a Democratic consultant who worked on Sanders’ presidential campaign in 2016. “It seems like her current proposal is more specific than what Senator Sanders has talked about in the past.”
If more candidates roll out proposals that would crack down on big tech, it could indicate a broader shift in the relationship between Democrats and the industry. The party has long enjoyed generous donations from tech workers; Google representatives went to the Obama White House hundreds of times, according to The Intercept.
On Friday, some industry representatives were already pushing back on Warren’s plan.
“This unwarranted and extreme proposal, which focuses on a highly admired and highly performing sector, is misaligned with progressive values, many of which are shared within the tech industry,” Ed Black, CEO of the Computer & Communications Industry Association, said in a statement.
Representatives from Facebook and Amazon declined to comment. Google did not immediately respond to requests for comment.
Under the plan, companies with annual revenue of $25 billion or more and that offer an online marketplace or platform that connects third parties would not be allowed to own both the platform and entities that use it. That would mean, she explained, that Google’s ad exchange and its businesses that use the exchange would have to be spun off from each other. Warren said she would also appoint regulators to undo “anti-competitive mergers” like Amazon’s purchases of Whole Foods and Zappos, or Facebook’s takeovers of Whatsapp and Instagram.
Companies making between $90 million and $25 billion per year would have to meet standards of “fair, reasonable and non-discriminatory dealing with users,” as the bigger companies would, but would not have to separate from participants on their platforms.
Warren has called previously for an antitrust crackdown on the technology industry, including in speeches in 2016 and 2017, although Republican critics point out that she has spoken favorably of Amazon’s opening a warehouse in Massachusetts, and that she said the company’s bringing a new headquarters to Boston would have been a “good bet.” And Friday was not the first time Warren addressed the issue of big tech on the campaign trail; in January she affirmed her support for breaking up big tech companies in response to a question from the Globe.
“I believe we ought to be enforcing our antitrust laws and I’m deeply worried about tech giants that snuff out early-stage competition,” Warren said then. She said that it is unfair for Amazon to be able to collect information on buyers and sellers who use its online marketplace, which it can then use to decide whether to compete with those third-party sellers.
“There’s a place where Amazon needs to fish or cut bait,” Warren said, “You don’t get to do both at the same time.”
But she has not made it a central part of her stump speech. Generally, her portrait of corporate greed in the American economy feels more “It’s a Wonderful Life” than “Silicon Valley,” as her spotlight on role of big banks, lobbyists, and the wealthy brings to mind Henry F. Potter, the capitalist villain in the Frank Capra film. (Warren’s golden retriever, a tail-wagging presence on some of her campaign stops, is named Bailey, after George Bailey, the do-gooder founder of a tiny lender in the film.)
Some voters have noted that makes her stump speech seem old-fashioned.“I felt like I was at a progressives rally in the ’20s, in a good way,” said Alex Aakre, 21, a student at Luther College in Decorah, Iowa, who crowded into a pizza parlor basement to see Warren last week. “Someone my great-grandfather would have voted for.”
On Friday, some advocates for more competition in technology were pleased to see Warren directing that brand of crusading populism toward big tech. “It is long past time that policymakers begin to grapple with the power of these big tech giants,” said Matt Stoller, a fellow at the Open Markets Institute, adding that he hoped other candidates would do the same. “If you don’t talk about big tech, you sound like you’re not in the economy of 2019.”
It is also another example of Warren buttressing her presidential run with a series of concrete policy proposals aimed at defining the debate within the rapidly expanding Democratic field — an approach that has excited liberal groups like the Vermont-based Democracy for America, which was founded by Howard Dean and endorsed Sanders in the 2016 Democratic primary.
“She is putting out and identifying very specific issues and very specific proposals on how she’s going to answer them,” said Charles Chamberlain, the group’s executive director. “It’s really kind of setting a bold standard for laying out what kinds of politics, what kinds of big ideas, Democrats should really be getting behind.”