The Fight Ahead to Breakup Amazon
This Congress has taken significant first steps toward reining in Amazon’s power, setting the foundation for Amazon to be broken up once and for all. In early 2020, breaking up Amazon or bringing any meaningful antitrust legislation to the floor was unthinkable — a “radical”, “fringe” idea that seemed partisan at best, and at worst, a non-starter even for legislators avowed to tackling corporate concentration. Yet thanks to the relentless efforts of workers, small businesses, and racial justice and civil rights organizations, this Congress, led by the Judiciary committees, made tremendous strides not only to investigate Big Tech monopolies, but also to move substantial legislation through the House and Senate committees with bipartisan support.
The challenge we faced
At every turn in this fight, Big Tech corporations wielded their tremendous capital and power to protect their monopoly power. In total, the Big Tech monopolies spent over $95 million in lobbying in just 18 months, since the start of 2021.[1] Like the other Big Tech corporations, Amazon has ramped up its lobbying spending significantly in the past decade to defend its rapid acquisition of competitors,[2] anticompetitive conduct,[3] and mistreatment of workers[4] (see Figure 1). To date this year, Amazon spent a record $16 million on lobbying,[5] employing an army of 118 federal lobbyists.[6] This war chest of lobbying spending makes Amazon the 6th largest spender on lobbying in the country, and the single largest individual corporate spender.[7]
Amazon’s self-reported lobbying expenditure, however, does not include the totality of its true lobbying activities. Taking a cue from Big Tobacco and Big Oil playbooks of the past, Amazon and other Big Tech companies have increasingly relied on “astroturf” groups to represent its interests among legislators and regulators. In 2020, former Google lobbyist Adam Kovacevich founded Chamber of Progress, a trade group that misleads audiences into believing its intentions are to fight for progressive values — but in reality is funded and controlled by Big Tech companies including Amazon.[8]
Figure 1: Amazon lobbying spending, 2012–2022. Source: OpenSecrets.org
While astroturfing trade groups are common stock in Washington, some Big Tech tactics are less common, and even more ethically ambiguous. In March of this year, reporters found that an Amazon and Google-funded lobbying group listed dozens of small businesses as its “members” without their consent or knowledge.[9] Many small businesses across the country heard about the pro-tech group for the first time when contacted by reporters about their alleged membership.
Apple CEO Tim Cook and Amazon CEO Andy Jassy personally picked up the phone and called members of Congress, Democrats and Republicans alike, to lobby against the passage of these bills — proving that the bills, if passed and implemented, would pose serious threats to the respective businesses.[10] Part of the access Big Tech executives have to the top ranks of Congress may be attributable to their political contributions: in the 2020 and 2022 federal election cycles, Amazon’s PAC contributed over $2.3 million to individual candidates, to both Democrats and Republicans.
Big Tech’s efforts, however, were not limited to Congress. Amazon attempted to remove Federal Trade Commission Chair Lina Khan from matters concerning the company,[11] while Google successfully barred the Department of Justice head of antitrust, Jonathan Kanter, from actions involving the company.[12] Both Khan and Kanter are long-time critics of Big Tech.
All the while, Amazon flexed its capital and growing monopoly power by expanding into new industries through pricey mergers that have raised concern among regulators. These mergers and acquisitions only allow Amazon’s unfettered growth to continue, and raise the stakes for urgent action to rein in the monopoly. In the past two years, the corporation’s buying spree included the following:
- $1.3 billion to buy Zoox, an autonomous vehicle company[13]
- $1.7 billion to buy iRobot, a robot vacuum maker (This deal is currently under investigation by the FTC.)[14]
- $3.9 billion to buy One Medical, a primary health care network (This deal is also currently under investigation by the FTC.)[15]
- $8.5 billion to buy MGM, the film and television studio[16]
What we accomplished
Despite the formidable opposition by some of the most profitable corporations in the world,[17] we built a broad coalition of Amazon workers and labor organizations, racial justice groups, and activists fighting corporate monopolies, surveillance, and state violence, as well as organizers fighting for environmental and economic justice. In response to our coalition’s demands, as well as the relentless organizing of Amazon workers, small businesses, and racial justice, civil rights, and antimonopoly activists across the country, the 117th Congress took significant steps toward laying the groundwork to rein in Big Tech.
Under the leadership of House Judiciary Committee Chair Jerry Nadler and House Subcommittee of Antitrust, Commercial and Administrative Law Chair David Cicilline, six bipartisan bills were introduced to rein in the monopoly power of Big Tech. These bills were built on the findings of Subcommittee Chair Cicilline’s 18-month investigation[18] into the anticompetitive conduct of the Big Tech companies during the 116th session of Congress:
- H.R. 3816, the “American Choice and Innovation Online Act”
- H.R. 3460, the “State Antitrust Enforcement Venue Act of 2021”
- H.R. 3826, the “Platform Competition and Opportunity Act”
- H.R. 3825, the “Ending Platform Monopolies Act”
- H.R. 3849, the “Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act”
- H.R. 3843, the “Merger Filing Fee Modernization Act”. This last bill was passed through the House of Representatives.
Several bipartisan companion bills were also introduced in the United States Senate and passed through the Senate Judiciary Committee.
Our movement also successfully advocated for the appointment of personnel across the Biden-Harris Administration in independent agencies that have taken and will continue to take bold action against Amazon and the Big Tech companies: Federal Trade Commission Chair Lina Khan, Federal Trade Commissioner Alvaro Bedoya, Special Assistant to the President for Technology and Competition Policy Tim Wu, and United States Assistant Attorney General for Antitrust Jonathan Kanter.
Chair Khan has led the FTC to investigate several potentially anticompetitive acquisitions, including those of Amazon listed above, in addition to an antitrust lawsuit against Facebook for monopolistic behavior.[19] The Department of Justice is expected to take action against Apple for anticompetitive behavior,[20] as well as Google for its own anticompetitive behavior in collaboration with 11 state Attorneys General.[21] Another DOJ case against Google, specifically over its anticompetitive behavior in the online advertising market, is anticipated to be announced shortly.[22]
Finally, pressure from workers and advocates have led President Biden and his administration to voice enthusiastic support for reining in Amazon and other Big Tech companies.[23] Last summer, President Biden signed an executive order of 72 actions and recommendations to limit Big Tech’s monopolistic power, further codifying the administration’s support of ambitious action against their outsized influence in our economy and our democracy.[24]
The road to victory
In addition to the clear forward momentum of the movement to rein in Amazon and Big Tech, several other indicators make us optimistic about the road to victory.
Personnel is policy, and we remain confident that leaders like FTC Chair Khan, Assistant Attorney General Kanter, and Special Assistant Wu will remain vigilant and bold in their fight against Big Tech. What’s more, several incoming members of Congress have publicly committed to tackling corporate concentration head on, including John Fetterman, Chris Deluzio, Mary Petolta, and Pat Ryan.[25] We look forward to these members’ leadership in Congress to introduce strong bills to tackle Amazon and Big Tech, and fight for their passage. These future members’ successful campaigns prove there is a mandate from Americans across the country to tackle corporate power and increasing concentration head-on.
We also look forward to findings and subsequent action of major investigations and lawsuits including the aforementioned FTC investigations into Amazon’s mergers, as well as among state Attorneys General; the Washington State AG has already fined Amazon $2.5 million and shut down its “Sold by Amazon” price fixing program[26] and the California AG sued Amazon for unfairly penalizing merchants for offering products at lower prices on competing sites.[27] State bills in New York[28] and Minnesota[29] that would tackle corporate concentration are also gaining momentum. We anticipate support will only grow in coming years, especially given Democrats’ victory in the Minnesota state legislature this past election, handing Democrats full control of the state government.[30]
Concentrated corporate power has long stood in the way of improved public and social services, safe jobs with good pay, opportunities for entrepreneurs, racial and social equity, and a strong democracy. It is not surprising that Amazon and other Big Tech monopolies are fighting tooth and nail to maintain and grow their power. Yet momentum toward reining in these monopolies and breaking up Amazon is undeniable, as evidenced by the incredible efforts to start doing so in the last two years. We will continue fighting to restructure our economy to work for all of us, not a handful of billionaires.
Originally Published: December 18, 2022 in Politico.
References
[3] https://www.washingtonpost.com/technology/2022/09/14/california-amazon-antitrust-lawsuit/
[5] https://www.opensecrets.org/federal-lobbying/top-spenders
[6] https://www.opensecrets.org/federal-lobbying/clients/summary?cycle=2022&id=D000023883
[7] Larger spenders include lobbying groups (i.e., US Chamber of Commerce), trade associations and group (i.e., National Association of Realtors, Pharmaceutical Research & Manufacturers of America, American Hospital Assn), and federations of companies (i.e., Blue Cross/Blue Shield).
[8] https://progresschamber.org/partners/
[9] https://www.politico.com/news/2022/03/30/connected-commerce-council-amazon-google-lobbying-00021801. https://www.cnbc.com/2022/03/30/how-google-and-amazon-bankrolled-a-grassroots-activist-group-of-small-business-owners-to-lobby-against-big-tech-oversight.html
[10] https://www.politico.com/news/2022/06/17/amazon-jassy-antitrust-bill-00040461. https://www.businessinsider.com/tim-cook-nancy-pelosi-apple-lobby-antitrust-bills-legislation-nyt-2021-6. https://www.cnbc.com/2022/01/20/ted-cruz-spoke-to-apple-ceo-tim-cook-for-40-minutes-about-antitrust.html
[11] https://www.protocol.com/policy/khan-facebook-amazon-recusals
[14] https://www.cnn.com/2022/09/20/tech/roomba-amazon-ftc-investigation/index.html
[17] https://companiesmarketcap.com/most-profitable-companies/page/2/
[18] https://www.govinfo.gov/content/pkg/CPRT-117HPRT47832/pdf/CPRT-117HPRT47832.pdf
[19] https://www.nytimes.com/2022/01/11/technology/facebook-antitrust-ftc.html
[21] https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-antitrust-laws
[25] https://prospect.org/politics/corporate-power-had-a-bad-election-night/
[28] https://prospect.org/power/anti-monopoly-fight-will-be-in-the-states/
