Editor's Note: The original version of this article attributed the phrase “the power to tax is the power to destroy” to former Supreme Court Associate Justice Oliver Wendell Holmes Jr. Then-Chief Justice John Marshall wrote those words in the landmark case, McCulloch v. Maryland.
Washington, D.C. – Minnesota Democratic Sen. Amy Klobuchar has her eyes fixed firmly on the White House, and, if President Joe Biden chooses not to run again, she'd like to take his place as the party's nominee. Before she can do that, however, she first has to burnish her progressive credentials.
One way she's trying is by going on the attack against Big Tech, an effort that's winning her plaudits from both sides of the aisle. It's not just those who think Karl Marx's economic theories make more sense than those espoused by Milton Friedman but those who say they believe markets work who are helping push her attempt to give the Federal Trade Commission the ability to set rules about what the dominant platforms – her words – can sell online without behaving in a manner that is “discriminatory.”
Klobuchar's been working hard to get her bill on the Senate floor before everyone goes home for the seven-week long August recess. Based on recent developments, it doesn't look like she's going to get what she wants, especially now that a group of prominent free marketeers has come out against what she is trying to do.
Among the 46 who signed the letter sent to congressional leaders on July 19 in opposition to her American Innovation and Choice Online Act are influential economists like Arthur Laffer, Richard Rahn and Stephen Moore as well as the leaders of influential organizations like Americans for Tax Reform, the Center for Freedom and Prosperity, the Small Business & Entrepreneurship Council and American Commitment. Their message is a clear one. Reject what's embodied in the Klobuchar bill. It expands the size and scope of government and exacerbates the inflationary pressures on America's families.
Most importantly, they say in response to charges leveled by Big Tech opponents on the right, there's nothing in the bill that would do anything to address the issue of censorship on social media platforms. Instead, the letter reads, her bill “would worsen these issues by forcing targeted companies into a ‘mother-may-I' relationship with the federal government” while suggesting the near-universal buy-in to what she wants proposes to do by progressive groups should be enough to arouse significant suspicion.
“Whatever so-called ‘improvements' that the left has in mind for content moderation will certainly not work out in favor of conservatives' free speech,” the letter goes on. “If conservatives are unhappy with the status quo, just imagine Big Tech targeting conservative speech on behalf of Biden bureaucrats.”
That's an argument that should move those like Colorado GOP Congressman Ken Buck back to his senses. Buck is a key leader on the right among those in the U.S. House of Representatives who have endorsed or are flirting with what Klobuchar wants to do.
It's an argument that has weight even as the reality of things flies in the face of what people are saying online. Even if some conservative leaders and groups have been temporarily or permanently “de-platformed,” an issue about which people routinely post, those who espouse conservative ideas can reach more people for less money today than they could in the days when there were only three national television workers (four with PBS) and The New York Times set the news agenda for everyone.
The organizers of the letter also clearly intend for their arguments to move those whose interest in expanding the Federal Trade Commission's antitrust powers is motivated by economic concerns. The most influential of these would be Iowa GOP Sen. Chuck Grassley, a one-time chairman of the Senate Finance Committee and Klobuchar's principal Republican co-sponsor.
Their argument that the bill, while it applies to only a handful of tech sector giants now, is a proverbial camel's nose under the tent leading to “future government regulation based on the size of a company, a government cap on innovation” and other developments eventually bringing the most productive and innovative sectors of the U.S. economy “under the heavy hand of government control” should be persuasive.
Whether they will be is not certain, even if these companies have allowed new voices to join the national conversation and added considerably to U.S. GDP. A new study by Laffer and John Barrington Burke on the economic impact of the Klobuchar bill shows these firms “provide services at steadily lower prices to consumers.” That is exactly the opposite of what monopolies do, meaning there's little justification for going after them for violating the existing rules on antitrust and adding weight to the charge that Klobuchar's base motivations are political.
As she no doubt intended, her bill is winning her plaudits from progressives for the way it turns antitrust law on its head. For nearly 50 years, a period that not coincidentally aligns with the long boom that saw the size of the U.S. economy grow to $20 trillion, antitrust enforcement occurred only when it could be shown consumers were harmed as the result of tangible, measurable outcomes like higher prices, reduced innovation or lower quality. Under the Klobuchar legislation, S. 2992, America would adopt a European-style attitude toward antitrust that allows governments to routinely pick winners and losers and target politically disfavored companies with frivolous lawsuits. According to the signers of the letter, that means “Bureaucrats win, consumers lose.”
That's backed up by the Laffer/Burke study, which says that over the last decade, the high-tech sector has been the most instrumental in holding inflation down. Overall prices may have risen by 22 percent, but the cost of tech products and services has fallen by at least 16 percent.
Not all that long ago, Democrats and Republican leaders in Washington both believed a vigorous, powerful, intrusive federal government that made critical decisions about the direction of the nation's economy was good for America. The GOP may have promised to run things more efficiently and at a lower cost than the other party but there was barely a dime's worth of difference between them. Then the Reaganites came, bringing with them a flurry of new ideas that produced then-record job creation, price stability and economic expansion.
Some in the GOP have lost sight of that, even if they were part of it when it happened. In the post-Trump era, some leaders are more open to the idea of using federal power to regulate business to punish those they perceive to be hostile or unfair to conservatives. This is not okay. Chief Justice John Marshall famously wrote, “the power to tax is the power to destroy.” He might have said the same thing about the power to regulate – which some conservatives who ought to know better are talking about giving the federal government more power to break up the companies that make up “Big Tech” based on their size alone, their annual revenues or the perception, valid or not, that they are unfair to the right.
The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.
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Her bill would Boost Big Tech
Klobuchar the Slovenian does not compare favorably with Melania the Slovenian. Melania is all for free enterprise and American values. Klobuchar seems to have shlepped along much of the stark communistic principles her family ‘escaped.’ and sounds quite willing to re-inaugurate them in an ‘American Federation of Soviet States’….
Where do the lefties get these stupid ideas? Big Tech provides the jobs that millions of people depend on, why on earth would they want to vote for someone that would cripple their employers and cost them their jobs? Other than the left wing progressives, most people are smarter than that.
I think, Gus, the Lefties have such unshakeable faith in Mega-government that they are like lemmings following the Fearless Leader, to dash themselves over the cliff to death on the bitter rocks of socialism. Put your faith in Man and you will be eternally disappointed. For absolute power corrupts absolutely.