Technology

What Steve Bannon Wants to Do to Google

The White House strategist reportedly wants to treat tech giants as public utilities, an idea that some Democrats also support.

By Robinson Meyer
Carolyn Kaster / AP

Over the past year, the old idea of enforcing market competition has gained renewed life in American politics. The basic idea is that the structure of the modern market economy has failed: There are too few companies, most of them are too big, and they’re stifling competition. Its supporters argue that the government should do something about it, reviving what in the United States we call antitrust laws and what in Europe is called competition policy.

Stronger antitrust enforcement—it’s enough of a thing, now, that Vox is explaining it.

The loudest supporters of this idea, so far, have been from the left. But this week, a newer and more secretive voice endorsed a stronger antitrust policy.

Steve Bannon, the chief strategist to President Donald Trump, believes Facebook and Google should be regulated as public utilities, according to an anonymously sourced report in The Intercept. This means they would get treated less like a book publisher and more like a telephone company. The government would shorten their leash, treating them as privately owned firms that provide an important public service.

What’s going on here, and why is Bannon speaking up?

First, the idea itself: If implemented, it’s unclear exactly how this regime would change how Facebook and Google run their business. Both would likely have to be more generous and permissive with user data. If Facebook is really a social utility, as Mark Zuckerberg has said it is, then maybe it should allow users to export their friend networks and import them on another service.

Both companies would also likely have to change how they sell advertising online. Right now, Facebook and Google capture half of all global ad spending combined. They capture even more global ad growth, earning more than three quarters of every new dollar spent in the market. Except for a couple Chinese firms, which have a lock on their domestic market but little reach abroad, no other company controls more than 3 percent of worldwide ad spending.

So if the idea were implemented, it would be interesting, to say the least—but it’s not going to become law. The plan is a prototypical alleged Bannonism: iconoclastic, anti-establishment, and unlikely to result in meaningful policy change. It follows another odd alleged Bannon policy proposal, leaked last week: He reportedly wants all income above $5 million to be taxed at a 44-percent rate.

Which bring me to the second point: Bannon’s proposal is disconnected from the White House policy that he is, at least on paper, officially helping to strategize. The current chairman of the Federal Communications Commission, Ajit Pai, is working to undo the rule that broadband internet is a public utility (which itself guarantees the idea of “net neutrality”). Trump named Pai chairman of the FCC in January.

Bannon’s endorsement of stronger antitrust enforcement (not to mention a higher top marginal tax rate) could very well be the advisor trying to signal that he is still different from Trump. Bannon came in as the avatar of Trump’s pro-worker, anti-immigration populism; he represented the Trump that tweeted things like:

As the president endorses Medicaid cuts and drifts closer to a Paul Ryan-inflected fiscal conservatism, Bannon may be looking for a way to preserve his authenticity.

Third, it’s the first time I’ve seen support for stronger antitrust enforcement from the right. So far, the idea’s strongest supporters have been Congressional Democrats. Chuck Schumer has elevated the idea to the center of the “Better Deal” policy agenda in 2018. Before that, its biggest supporters included Bernie Sanders, who railed against “Too Big to Fail” banks in his presidential campaign; and Elizabeth Warren, who endorsed a stronger competition policy across the economy last year.

Finally, while antitrust enforcement has been a niche issue, its supporters have managed to put many different policies under the same tent. Eventually they may have to make choices: Does Congress want a competition ombudsman, as exists in the European Union? Should antitrust law be used to spread the wealth around regional economies, as it was during the middle 20th century? Should antitrust enforcement target all concentrated corporate power or just the most dysfunctional sectors, like the pharmaceutical industry?

And should antitrust law seek to treat the biggest technology firms—like Google, Facebook, and perhaps also Amazon—like powerful but interchangeable firms, or like the old telegraph and telephone companies?

There will never be one single answer to these questions. But as support grows for competition policy across the political spectrum, they’ll have to be answered. Americans will have to examine the most fraught tensions in our mixed system, as we weigh the balance of local power and national power, the deliberate benefits of central planning with the mindless wisdom of the free market, and the many conflicting meanings of freedom.