In this episode of the Building Local Power podcast, ILSR Co-director Stacy Mitchell interviews Lynn about the changes in policy that gave rise to today’s monopolies, including the tech super-giants — Google, Facebook, and Amazon. And they talk about how a new movement to break up these monopolies is fast gaining momentum.
We let this episode run long, because there’s a lot to discuss. Mitchell and Lynn delve deep into the history of anti-monopoly policy in the United States, including the changes in antitrust enforcement in the 1980s that brought us to where we are today. And then they talk about where we go from here. Lynn outlines a one-two punch for wresting our country back from monopoly control: 1) We must see ourselves and assert our identity as citizens and not as consumers, and 2) We must talk about concentrated power and encourage our community leaders and elected officials to do the same.
“We are going to win. We are going to break up Google, Facebook, and Amazon. We are going to take on these other powers. The issue at this point is not, ‘Are we going to do it? Can we do it?’
We are going to do it,” says Barry Lynn of our current moment of reckoning.
He continues: “It’s just a matter of when and how. The American people, when they wake up, when they see the problem in front of their face, when they see that fist that is balled right there, we have awesome capacities to respond. Working together, just using our common sense, because that’s all we need to beat these people with their ideologies, just our common sense and our ability to see the facts before us. At this moment of despair, when people see these awesome concentrations of power, the most important step we have taken it, and that is to recognize the problem.”
The Rise and Fall of the Word ‘Monopoly’ in American Life — In this piece for The Atlantic, ILSR’s Stacy Mitchell looks at the history of the anti-monopoly movement in the U.S., and how today, as economic concentration soars, monopoly could again be just the word we need.
Cornered: The New Monopoly Capitalism and the Economics of Destruction — In his book, Barry Lynn “strips the camouflage from the secret world of twenty-first-century monopolies-neofeudalist empires whose sheer size, vast resources, and immense political power enable the people who control to direct virtually every major industry in America in an increasingly authoritarian manner.”
Report: Monopoly Power and the Decline of Small Business — This report from ILSR’s Stacy Mitchell details how the United States is much less a nation of entrepreneurs than it was a generation ago. This report suggests that the decline of small businesses is owed, at least in part, to anticompetitive behavior by large, dominant corporations.
Democrats Must Become the Party of Freedom — In this piece for Washington Monthly, Barry Lynn encourages a beaten and battered Democratic Party to re-embrace anti-monopoly policies to reinvigorate American liberty and beat back Trumpism.
The Monopolist’s Playbook: Strategies To Retain Overwhelming Economic Power – Episode 21 of the Building Local Power Podcast — In this podcast, ILSR researchers detail how monopoly power exerts itself in a number of different sectors of the American economy, such as: energy, Internet connectivity, and retail.
Open Markets Institute — The relaunched, independent website of The Open Markets Institute details the organization Barry Lynn leads to reclaim American liberty from concentrated corporate control.
Report: How Amazon’s Tightening Grip on the Economy Is Stifling Competition, Eroding Jobs, and Threatening Communities — In this comprehensive report, ILSR’s Stacy Mitchell and Olivia LaVecchia detail the history of Amazon and its quest for millions in public subsidies and growth throughout the economy.
|Stacy Mitchell:||Hello. Welcome to Building Local Power. I’m Stacy Mitchell of the Institute for Local Self-Reliance. We have a very special show with you today. My guest is Barry Lynn. Barry, I think it’s fair to say, is the founding father of today’s fast-growing movement against monopolies. Barry’s been working on this issue for more than 15 years. In that time, he’s been the Paul Revere, warning us of the dangers of concentrated economic power, and the Thomas Jefferson, articulating a framework for understanding and responding to this threat, and the Abigail Adams, quietly influencing the thinking of those around him.
The result is that there is a new movement afoot that seeks to wrest control of our country back from corporate monopolies and is gaining momentum. Today on the show, Barry and I are going to talk first about how we got to this point, and then turn to the important question of where we go from here. I first met Barry 10 years ago, when I had just published a book called Big Box Swindle, about how Walmart and other big retailers were taking over our economy. One of the central things I explored in that book was this question of what the hell had happened to our antitrust laws? At the time, Walmart was marching across the country, and it was employing tactics like predatory pricing and price discrimination to crush the competition. These tactics are illegal. I looked up the laws, and yet the laws weren’t being used to check Walmart’s power.
The same year I published that book, Barry wrote a terrific essay in Harper’s Magazine called Breaking the Chains: the Antitrust Case Against Walmart. Barry and I found we had a lot to talk about. In 2010, Barry produced a book that’s a favorite of ours here at ILSR. It’s called Cornered: the New Monopoly Capitalism and the Economics of Destruction. He then went on to write a series of deeply-reported articles about how monopolies are pushing down wages, stifling innovation, and killing job creation. His pieces have also tracked the political currents around monopoly policy, including how the Democratic Party had lost its way on this issue, and how that failure may have contributed to the election of Donald Trump.
Barry published many of his most important pieces in Washington Monthly, an underappreciated magazine that should be in your rotation if it’s not already. Barry is the executive director of the Open Markets Institute. He joins us today from our Washington, DC office. Barry, welcome to the show.
|Barry Lynn:||Thank you. Great to be here. I must say, you have been working with me for pretty much since the beginning, so I did help to pioneer this, but I think you get just about equal credit for pioneering where we are today.|
|Stacy Mitchell:||Well, that’s too kind of you, but I appreciate it. It’s been just so terrific to see this really take off in the last few months. Now the real work begins, right? It’s good. I want to ask, I talked a little bit in the intro about how I came to be thinking about this issue. I want to ask how you came to be thinking about it.|
|Barry Lynn:||Yeah. I came to think about or actually see America’s concentration problem, America’s monopoly problem, in somewhat of a roundabout way. I run, used to run a magazine called Global Business, and this was back in the 1990s. This was a major magazine back in those days. What I did is I had never studied anything about concentration. I hadn’t studied competition policy, but what got me walking down this pathway was there was an earthquake in Taiwan in 1999, in September 21, and there was a disruption to the production system. All of a sudden, all these factories in the United States shut down. I said, “Well, why did these factories shut down in the United States when there’s an earthquake in Taiwan, on the other side of the world?”
It turned out that all the certain kind of semiconductor was being made in this one town in Taiwan named [Sinju 00:04:05] and then being exported out to all the rest of the world. In essence, what I saw with that one earthquake was that human beings as a society, we put all of these really important eggs in one basket. It was at that moment, and I wrote a first book, which is called End of the Line, and that was about supply chain crashes, and it was about the effects of concentration on the functioning of complex systems.
What I really came to understand in writing that first book, this really was a too-big-to-fail-type thesis that I was dealing with, was that the reason that we saw this cascading failure of a supply system was because everything had been concentrated in one place. That’s what led me to look at the changes in how, especially here in the United States, but also people all around the world, did their competition policy, how we think about monopoly, how we protect ourselves against monopoly, or, as the case actually is, how we don’t protect ourselves against monopoly or the concentration of risk the way we used to.
|Stacy Mitchell:||It’s really interesting about these hidden monopolies in the supply chain, because I think most people, they encounter some monopolies in their lives that they recognize for what they are, maybe the cable company, I think 75% of all households have at most one choice for broadband internet. They see it in the airlines, especially if you live in a small city like I do, where you have one choice about which airline to fly to a given destination. Maybe they see Walmart’s power.
One of the things you’ve written about are all these things that are hidden monopolies to people. You talked a little bit about the supply chain ones, but there are other kinds of hidden monopolies that live behind what seems like a lot of choice, the sort of veneer of choice. Can you talk about what some of those are?
|Barry Lynn:||Yeah. There’s one that I wrote about in Cornered. This is a story that’s gotten a lot of attention, actually, including last night on John Oliver. What I wrote about was this company called Luxottica, which is an eyeglass manufacturer, but they’re actually a lot more than being an eyeglass manufacturer, because what happened is they realized that, in order to sell more eyeglasses, one way to do that would be to buy up all of the retailers. At some point, more than a decade ago, this Italian company called Luxottica came to the United States, and they started to buy a whole bunch of retailers. They bought LensCrafters. They bought Pearl Vision. They provided services to all the federated stores, Macy’s. They provide eyeglass services for all of the Target stores. They own Sunglass Hut.
Here’s a company where, if you go to the mall, because people still tend to buy their glasses in a physical location, you walk around in your town, you may see a whole bunch of different places selling eyeglasses, but what you don’t know is that they’re all owned by this one company called Luxottica. Luxottica is steering all of your business to their factories, so that the entire sense that you have that you are operating within an open market and there’s competition for your business is a myth. It’s an illusion.
|Stacy Mitchell:||It’s amazing. The supermarket ones also are phenomenal to me. You walk down the dairy aisle and you think, “Oh, I have all these choices for milk.” You walk down the beer aisle and you think, “Oh, I have all these choices.” It turns out all those brands are owned essentially by two companies, right?|
|Barry Lynn:||Yes. There’s really two companies that control almost all of the milk business in the United States. In many cases, they trade off their control, so that if you go into one particular store, you may just be dealing with one particular company. I remember going into this one Walmart, this is down in Tennessee, and there were maybe eight different brands of milk. When I left, I wrote down all of those different … Every one of those brand names, I wrote it down. Then, when I left, I started Googling. I discovered that every one of those brands was all controlled by just one company. All that milk, at all these different price points, it was all being sold by one company.|
|Stacy Mitchell:||It’s amazing. I think one of the things I really like about your work is that you’ve helped us recover a history that had been lost. We have this incredibly robust anti-monopoly history, and yet, from the view of today, a lot of that history has been obscured or lost. The example that, when I was working on Big Box Swindle and first really looking into this issue, I went back to look at the origins of the country, and the stuff that the Founding Fathers said, and so on. I was really … The Boston Tea Party was the one that so struck me at that time. I ended up writing about it in the book, because it’s this story that we all learn about how the colonists didn’t like taxes, and so they dumped tea into the harbor, right?
But no. It turns out that, in fact, there’s this big company, the East India Company, the global conglomerate of its time, which, as all monopolies do, had a very close relationship with the British Parliament, and had gotten itself into trouble through some bad choices that it made. It was losing money, in danger of going under, and Parliament stepped in and said, “Well, we’ll lift the duty on taxes. You can go sell all your tea in the American colonies. We’ll charge all those local tea merchants over there taxes, but you don’t have to pay them.” When the colonists went and dumped 46 tons of tea into Boston harbor, it was really a protest about monopoly, about corporate power, and about the relationship between corporate power and political power.
That was so eye-opening for me to discover. Then in reading your work over the years, learned more and more about how this history has actually played out, and that the period that we’ve been living in for the last 30 years, 40 years or so, is really a departure. I was wondering if you could help our listeners by telling us how our federal antitrust policies initially came about, which I think the earliest ones at the federal level are really in the 19th century, and before that, economic power had been controlled at the state level. What was it that led to the national policies, and what are the key milestones in that process of building up those laws?
|Barry Lynn:||As you mentioned, America, in many respects, was born out of rebellion against monopoly, the British East India Company. There are letters from 1773, signed by people like Sam Adams and John Hancock, in which they’re saying, “The problem with this company is not simply that they’re screwing with our commerce. The problem with this company is that they are a threat to our liberties.” America, in many respects, was born out of rebellion against monopoly, was born to … People created the country to ensure that they had liberty as individuals to sell their own products and their own labor to anyone that they wanted to within their own societies, in open markets.
At the beginning, the idea was, “No one is going to tell me who I can sell my goods to and my labor to, and no one is going to tell me at what prices. We’re going to just figure it out among our own selves. Liberty.” Over time, we kind of understood that monopoly was also a threat to our democracy, our democratic institutions. You allow people to concentrate wealth, concentrate power, concentrate control, and when you allow that, then your democratic institutions are almost inevitably put at risk, so we’re going to fight monopoly to preserve democracy.
Over time, Americans also understood, and this is actually what your institution is doing such a great job of promoting this idea today, is that communities, Americans wanted each community to be self-governing, the people in each, every community to govern the commerce within that community. Monopoly, people understood, was a threat to the sovereignty of the people within a community, our ability to do with our community what we will.
Americans did a fantastic job over most of our history at preserving liberty, democracy, community, through the use of anti-monopoly law. As you mentioned, initially, this was easy to do at the state level, at the local level. What happened over time is that new technologies came along, the railroad, the telegraph, and this allowed people to project power over space in ways that had not been possible before. Thanks to the railroad, thanks to the telegraph, you saw these corporate powers escape the control of state powers that had … The state powers that had regulated them up to that point.
In the 1888, 1890, you saw a set of the first federal anti-monopoly laws being passed. The first ones were … The Interstate Commerce Act was designed to protect people who were shipping things from the power of the railroads. The second one was the Sherman Antitrust Act, and that was in 1890. That was a more general anti-monopoly law. That was designed to break what people saw as cartels, which were, at that point, were the first real super-corporations, in which people would blend multiple corporations into a single entity. That was, from that point forward, most anti-monopoly policy has been pursued at the federal level, because most commerce in the United States takes across state borders.
|Stacy Mitchell:||We often talk about Teddy Roosevelt as being a trustbuster, but I think there are some later presidents that actually maybe even had a more influential role. Who stands out in your mind?|
|Barry Lynn:||The people who were most responsible for the modern anti-monopoly regime, the regime that was in place through most of the 20th century, that was Justice Luis Brandeis. Brandeis was put onto the court by President Wilson. He was appointed to the court by President Wilson in 1916. In 1912 and 1913, Brandeis was a close advisor to candidate Wilson and then President Wilson. Together, the two of them really established a language. They resurrected, renovated, updated, modernized the language of Jefferson and Madison for the Industrial era, of the 20th century.
Then, in the 1930s, we had a couple of other people who were major players in this. There were many people, but two others who were really important were FDR … Franklin Roosevelt was, in a way that … More so than almost any of his advisors, really understood anti-monopoly, and just delivered some of the most important speeches and pursued some of the most important actions in the 1930s. All together, by the end of the 1930s, you had in place the regime that would remain in place until Ronald Reagan began to take it apart in the early 1980s. It was that regime, that antitrust system that was put in place beginning more than 100 years ago with the election of 1912, really accelerating in the 1930s, that approach to competition policy, to breaking up power, neutralizing power, that was more than anything else responsible for the fantastic prosperity and spread of liberty that we saw in the United States through the heart of the 20th century.
|Stacy Mitchell:||All those fat decades of the 1940s, ’50s, ’60s, that’s the period when anti-monopoly policy is at its strongest, right? Talk about how that unraveled, because here you had these really solid public policies that served these deeply-held core values of liberty, of equality, of democracy, and they worked. You had an economy that did quite well, with a lot of innovation, rising middle class, shrinking gap between the rich and poor, women and people of color still not fully allowed in, but making big progress in those years. Anti-monopoly wasn’t maybe the only factor, but it clearly was a huge one, so how is it that, given that history and the effectiveness of those policies, how did that begin to come undone? How do we get to Reagan’s election, and he can flip a switch and turn these things off and no one does anything about it?|
|Barry Lynn:||That’s a great question. That’s really the key question to understanding what went wrong in America. We know that in the early days of the Reagan administration, he and his people targeted unions. That was a big deal. Unions are actually part of competition policy. The idea is like, “We’re going to make it easier for the worker to get together and join his or her labor with his or her colleagues in a way that allows them to equalize their bargaining power with a corporation. That’s always been part of competition policy properly understood. The Reagan people went after unions right at the beginning. We know that. We’ve told that story, but what they also did, and this is the story we haven’t talked about, is they went after anti-monopoly pretty much as we had done it in America going back to 1773.
What they said is, “Rather than using our anti-monopoly law to protect our liberty, to protect our democracy, to protect our communities, to protect innovation, we should use anti-monopoly law to promote our welfare as consumers. The result of promoting our welfare as consumers is that we’re going to get more stuff. We’re going to get more material things. The way to measure that, we’re going to measure it by price. Actually, we’re not even going to really measure it. We’re just going to take people’s word for it. If you come to us and you say, ‘We’re going to make a merger,’ and you can make a reasonable case that a merger is going to … That you’re going to use the power from this merger to cut prices, we’re going to let you do that merger. If you happen to grow organically the way Walmart did, we’re going to leave you alone, as long as you make this case that you’re lowering prices.”
Just kind of at a stroke, they did this by just changing the guidelines that are used to interpret all anti-monopoly laws. They changed the philosophy that we use to understand our anti-monopoly laws. At a stroke, they just took this whole rich body of law and they turned it on its head, and they essentially turned it into a tool of the monopolists, of he who seeks to concentrate power and control over others.
|Stacy Mitchell:||As long as those companies are offering a veneer of choice and the appearance of low prices, at least in the short time, we traded our liberty, our democracy, and all of the rest of it for that.|
|Barry Lynn:||All the rest of it, all the things that America was built to protect, everything that was most important for the citizen, we traded all that away for a few pennies worth of stuff.|
|Stacy Mitchell:||Where was Congress when this was happening? Partly, where was the Democratic Party, but also, there were Republicans who got this stuff too. We have a history of at least some conservatives being supporters of this, so how did Reagan do this and what was Congress up to at the time? Did they just miss it, or did they … What happened?|
|Barry Lynn:||That’s a great question, because it’s like, “How do we miss this kind of revolution?” Here we had this revolution in America back in 1773, and we studied that. When we think about it, it was revolution against monopoly. 200 years later, a group of people came in and engaged in a counter-revolution to overturn the prohibitions against monopoly in ways that would allow the rich and the powerful to concentrate control over the rest of us. There were a number of people in Congress who noticed that something was up. There was a group of senators, Howard Metzenbaum was one of them, Arlen Specter, a Republican, who said, “Hey, what is going on here? This is outrageous. This is wrong. We have to do something about it.” They were not able to concentrate sufficient power to stand up to the Reagan administration at that time.
One of the reasons, and this is an important factor, is one of the confounding factors was that when the Chicago Schoolers on the right, when the people promoting consumer welfare came to this in the Republican party and promoted these changes in the Reagan administration, there was a group of folks on the left who said, “Amen.” This was a group of folks that … It was really from the command-and-control Socialist left. It was the command-and-control left. You say, “Okay, when in American did we ever had a command-and-control left?” We actually had a very powerful intellectually and a very influential command-and-control left that in the 1960s and ’70s was led by a thinker, an economist, a writer who was very famous in those years called John Kenneth Galbraith.
John Kenneth Galbraith, his whole philosophy was that, well, what you do is you let the rich and the powerful concentrate control over entire parts of the political economy, and then we stick the government on top of it, and we make sure, we use experts to regulate the system, to command the capitalists to do the right thing, and it all ends up good for the people. It was the command-and-control left provided the cover for the command-and-control right to concentrate the power that we have seen concentrated in this country.
|Stacy Mitchell:||You’re listening to Barry Lynn, executive director of the Open Markets Institute, and a leading thinker on anti-monopoly. I’m Stacy Mitchell with the Institute for Local Self-Reliance. We’ll be right back with more of this conversation after a short break.
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When all those changes happened in the ’80s, and there was this revolution on how we looked at antitrust from a policy perspective, Reagan, Galbraith, all of that, it’s amazing how much that ideology blinds people in power to what’s really going on, or at least gives them cover not to look. What’s so striking to me about this issue is how much people on the ground, how much small business owners, farmers, and others out there encounter monopoly power all the time. I hear it from all sorts of people. I’m sure you talk to people all over the country for whom this is true. Whether they’re brewing beer, or driving a taxi cab, or whatever it may be, they are at the losing end of monopolies who are simply using their size and power to crush competition and do so in ways that harm our welfare across the board.
Yet federal regulators, people in power, have this ideological view that allows them to live in I think a kind of fantasy land where these things aren’t actually happening. They allow their ideology to form how they see the world, as opposed to allowing reality to inform how they think about the world. This has been going on for a long time, where small business owners have been dismissed, but it seems like reality is maybe beginning to overwhelm this misguided set of notions that have overwhelmed policy for so long.
|Barry Lynn:||Yeah. No, absolutely. We are seeing change, real change for the first time. What is that change? Actually, the most important part of that change is seeing the monopoly problem. To put it bluntly, what it is is seeing that this is concentrated power that we are facing. This is not an economic problem. It’s a political-economic problem. Our rights are being taken from us. As I mentioned before, our liberty is being taken from us. Our democracy is being destroyed. When monopolists concentrate power, they are basically concentrating a fist, and they are putting that fist in our face. They’re using that fist to make us cower. They’re using that fist to make us accept lower wages. They use that fist to force higher prices on us. They use that fist to get us to work longer hours. They use that fist to push bad drugs on our children. Monopolists use that fist to kill people, and they use that fist to concentrate more and more control in their own hands.
Now, what the economists of the last generation did, what the Chicago Schoolers did, the real magic that they managed to achieve is, when they came in with this consumer welfare frame that we talked about, is one of the things they did is when they were creating the consumer welfare frame, they basically managed to lop of the word political from political economy. They said, “In this new world, that antitrust, it’s not a matter of politics. It’s not a matter of people using our combined power of our votes and our voices to affect the world around us through Congress. This is entirely a matter of science. When we’re trying to promote our interests as consumers, we have to approach this scientifically, and we need to have specially trained economists and lawyers study this. No one else should actually be involved in this.”
Actually, you can look at this. Robert Bork, who is the father of this whole movement, in his book, the Antitrust Paradox, right at the beginning, it says, “This is a science,” and basically, asserting that it was a science, “The goal of this,” and they actually achieved this goal, was “to hide the fist” that was in our face. Here we have been, for 30 years, beaten, day after day by these people who have concentrated power against us, and they use that power against us. Yet, somehow, these people have tricked us into not seeing the fist that is beating us.
Now, thank goodness the American people at last and many of our representatives in Congress are waking up to the fact that this fist of power has been concentrated against us. As you said, it’s like, at a certain point, just the mere facts gets up to … The pile of facts is so large that you just cannot ignore it anymore. We’re now at the point where the pile of facts is such that the American people and our representatives are waking up and seeing that this whole ideology that was conjured out of nothing and used to trick us into giving up these tools that we had built over the course of 200 years, that was a giant lie. We’re starting to form our own fingers into a fist.
|Stacy Mitchell:||Mm-hmm (affirmative). Why do you think the issue of monopoly has caught fire right now? What is that pile of reality that is catching up on this issue?|
|Barry Lynn:||There’s a whole bunch of … You and I have been doing this for a long time, and we’ve seen all these different effects. We know that it means higher prices for certain goods, and it means less choice. When you teach people … You’ve been doing journalism and outreach, and your team has written really terrifically important papers, like that big report you did on Amazon. Getting these papers published, getting them out there, connecting them together with other people’s papers, just providing the facts for people to see by themselves, providing analysis for people to see, all the work that you have been doing, and that members of my team has been doing, and other teams around Washington and around America, that preponderance of fact that we have built up is having a real effect.
This has been the muckraking period. We’ve all been raking the muck and pulling the truth out of the muck, and now, at this point, people see it. Before you can ever really deal with the problem, you have to see it. That’s where we are now, is we’re at the point where people see the problem. The other fact that is really starting to have an effect is, 10 years ago, you and I were talking about Walmart, but there were still a lot of different sectors of the political economy in which there were large companies. What we’re now seeing is a whole second stage of monopolization in which three giants, supergiants, Google, Facebook, and Amazon, are concentrating power that even makes Walmart scared.
|Stacy Mitchell:||Mm-hmm (affirmative).|
|Barry Lynn:||There’s this whole second stage of consolidation that is taking place today that is leading to a number of people to say, “Not only do we have a problem, but given the power these companies have, we better start acting now.”|
|Stacy Mitchell:||It’s also striking how bad the economy is for most people. I say that mindful of your right thinking that this is really ultimately an issue about power and about controlling the future of our communities. I think both of those things out there, both the sense that we have lost control over our own destinies at the local level, that we no longer have in our communities the capacity and the authority to shape our own future, I think a lot of the despair that’s out there is being driven by that.
It’s also striking as well these deep problems in the economy, whether it’s the failure to generate enough jobs, or how precarious so many of those jobs are. People working in the gig economy, doing two hour stints delivering packages for Amazon, they’re paid by a piece rate to do that. The fact that productivity has slowed, that corporations aren’t actually investing the way that they used to, you can look at all of these big measures, and things are not looking good, even though we’re supposedly at the height of a recovery period.
I think it’s one of the most interesting things that’s happened in recent years, is that the economists are beginning to recognize what’s going on, because none of the other explanations that they might offer up for these challenges really hold water, right? When you look at it, all of this seems to point back to concentration.
|Barry Lynn:||No, absolutely. It has gotten to the point where even, as you said, the economists are recognizing that we have a problem, which is quite … That is an achievement in itself. Something I want to make clear here is that we are going to win. We are going to break up Google, Facebook, and Amazon. We are going to take on these other powers. The issue at this point is not, “Are we going to do it? Can we do it?” We are going to do it. It’s just a matter of when and how.
The American people, when they wake up, when they see the problem in front of their face, when they see that fist that is balled right there, we have awesome capacities to respond, working together, just using our common sense, because that’s all we need to beat these people with their ideologies, just our common sense and our ability to see the fist before us, to see the facts before us.
At this moment of despair, when people see these awesome concentrations of power, the most important step we have taken it, and that is to recognize the problem. Once we have recognized the problem, once we have woken up from that ideology, I don’t know when ultimate victory will be at hand, but ultimate victory is in the future.
|Stacy Mitchell:||That’s great. I’m glad you have that kind of confidence. I have to say, one of the most encouraging things in recent months has been this attention on the big tech companies, on Google, and Facebook, and Amazon, because for a long time, I feel like we … People had this understanding of the bad monopolies. You could put your cable provider in there, your internet service in there, companies that really everyone hates, right? All the way around, they’re just awful.
Then there were these sort of good monopolies in a lot of people’s eyes, Google being one, Amazon being another. It’s been so nice to see that that’s finally breaking down, that people are, in fact, a lot of people, are very nervous about the power that they have, and that there’s this sense I think that’s beginning to drive a shift, where people are setting aside that consumer identity that has held us back for so long and beginning to recognize how these companies ultimately govern us in a way, and that it has everything to do with our livelihoods and our liberty. It’s really … I guess I’m genuinely surprised that this has happened. I thought it would take a lot more work for the conversation to turn on these guys.
|Barry Lynn:||Having just lived through this, because we were at … My Open Markets unit, institute, was until recently the Open Markets Program at New America, which was, is, a think tank here in DC. We just lived through an experience in which, back in June, we applauded this decision by the head of antitrust of the European Union, the decision that that person brought, Margaret Vestager, against Google. We said, “Hey, this was a good decision, and American regulators should learn from this decision and improve on it, build on it.”
The result of that was, within a couple days, my entire team was asked to leave New America. It was asked to leave New America because Google, a bunch of people, it wasn’t just one person, but a variety of people at Google brought real pressure to bear against the leadership in New America. That leadership buckled. We were shown the door. That ended up in the press, and one of the things that happened is just a phenomenal outpouring of support, just way beyond anything we expected, way beyond what anything that the communications people that we had worked with had expected.
What that really illustrates is that there is an absolute hunger out there. One, is there is real terror out there of these companies, but there’s also a hunger among people to stand up to them. Now, where is that coming from? One of the things that is at play is the Facebook fake news story, the Russian propaganda story. That’s educated a whole lot of people. Another issue is Amazon Whole Foods. Okay. Amazon, well, Amazon told us that retail was dead, physical retail was dead. We didn’t need to be in physical retail. It’s like, the whole was going to go virtual. Well, now, all of the sudden, they’ve made this sideways jump into the real world, and they seem to be intending to do a lot more of that. They’re setting up stores all over the place. They’re setting up stores inside of Kohl’s department stores.
You got Amazon owning Whole Foods. You got Amazon stores in a bunch of malls. You got Amazon inside of Kohl’s. Where does it stop? Is Amazon going to control all of commerce online and all of commerce in the real world? I think suddenly people are saying, “Well, golly. Maybe there’s something else going on here. Maybe this isn’t a pure technological play. Maybe this is actually just a monopoly play like we’ve seen before. Maybe, if we don’t do something about it soon, we’re going to be in a world of hurt.”
Another thing is there’s a growing concern among a bunch of companies about the power that Google has, power, not just over commerce, not just over our data, but actually over the newspapers that we rely on, control over the news magazines that we rely on. That Google and Facebook together, they control to a very large degree, the flow of news between the publisher and the reader, between the reporter and the reader, the author and the reader. In America, we have never before allowed for any couple of companies to have that kind of control over the flow of information from citizen to citizen that we see today.
People are seeing this in their lives in all these different ways, and every time they wake up to one problem, it helps them see other problems. It’s a cumulative thing, and that’s what makes sudden change possible, because the knowledge builds on knowledge, awareness builds on awareness, facts build on facts. What we’re seeing is, in America today, this awakening of the citizenry and of our leaders, and we are not going back to sleep again.
|Stacy Mitchell:||I love that. Sudden change is possible. Looking ahead at the coming months and years, what do you think is most important for us to do right now? If you were advising members of Congress, and if you’re out talking to ordinary citizens who are passionate about this issue and want to do something, and all the people you talk to, what is it that we should be doing? What’s the most important thing to have happen next?|
|Barry Lynn:||I think the most important, you and I have talked about this, is actually it has to do with how we see ourselves. We have to see ourselves as citizens foremost, not as consumers. For the last 35 years, really powerful people have tried to take us, and put us in a box, and call us consumers. They actually wrote that into the law. They scratched out, back in 1982, they scratched out the word citizen, and they wrote in the word consumer into our antitrust law, and that changed both how we are seen by the law and how we see ourselves to a large degree.
The first thing we have to say is, “I’m not a consumer. I am a citizen. I produce things. I produce labor. I produce goods. I produce ideas. I will have open and free markets into which to sell my goods, my ideas, my labor. There will be competition for my goods, my ideas, for my labor, and there will be no intermediary standing between me and my neighbors telling us how to do business with one another, just the way Sam Adams and John Hancock said back in 1773.” That’s the first thing we have to do.
The second thing is, for anyone who’s in a position of authority, a position of power, a position of leadership, this could be within your community, within your town, within your church, is just go out there and talk about this. You don’t have to figure out what the fixes are. There’s going to be a thousand fixes. There’s going to be 10,000 fixes. That’s the beauty of antitrust law, of anti-monopoly law, is we have an immense number of tools that we can bring to bear. What we have to do is see the problem, and help our fellows see the problem. We have to make it safe for other people on the Hill, on Capitol Hill, to talk about this.
If you’re on Capitol Hill, and we have a number of people who are taking the leadership roles in this, they need to speak about it more and more, and more and more powerfully, no matter who comes at them, no matter how hard the other folks come at them. Speak about it. Every time you speak about it, you make it easier for your fellows and your neighbors to speak about it. Every time they speak about it, it makes it easier for you to speak about it. Admit we have a problem. Talk about it. Make it normal, and we will fix it.
|Stacy Mitchell:||One of the people in Congress who has been an outspoken leader on this issue early is Elizabeth Warren. She gave a speech back in the spring of 2016, the spring of last year. You’ve called it the most important speech by someone at that level in 80 years on antitrust. It was widely covered. Time Magazine’s headline was “Elizabeth Warren says Google, Apple, and Amazon snuff out competition.” I actually thought one of the most radical parts of that speech went under the radar in some ways, which was how much Elizabeth Warren talked about markets.
She opens the speech and she says, “I love markets. Strong, healthy markets are a key to a strong, healthy America.” She talks about small businesses throughout that speech, over and over again. She ends, near the end of it, she says, “Competitive markets generate so many benefits on their own that the government’s only role in those markets should be simple and structural: Prevent cheating, protect tax-payers, and maintain competition.” Do you think the left heard what she was saying?
Here she is, the leader of the progressive wing of the Democratic party. When we think about the progressive wing is about, it’s about raising the minimum wage, about having a strong social safety net, about taxing the rich and making sure that that’s redistributed out, all things that Elizabeth Warren very much strongly supports, I should say. But progressives, for a long time, have been more about fixing what the economy does to people after the fact, and what Elizabeth Warren here is saying, “We ought to structure the economy from the get-go in a way that actually allows people to have the liberty and the equality straight out of the very structure of the economy itself.” Do you think people heard that?
|Barry Lynn:||I think a lot of people heard that. I think more people are hearing that every day. Part of what the Chicago Schoolers did on the right a generation ago, they kind of came up with this idea that markets are not so much things that people make in society, that they use laws and policies to make a market, but that markets are these kind of forces that exist outside of society, that society exists within the marketplace.
Now, a lot of folks on the left, a lot of well-meaning people, a lot of people who consider themselves liberals or progressives, have fallen for this lie that society exists within this thing called the market, that the market is like nature, that the market is like weather. It’s like, there is no such force out there that is the market. Markets are the institutions that human beings make to regulate how human beings compete one with another. If you structure a market well, it allows you to compete constructively, to actually bring new ideas and new techniques to bear so that we make more stuff for each other.
The other thing that markets do is markets are a pathway to freedom. If we structure a market well, in doing so, we provide liberty to ourselves, to our neighbors, to our children, to our families, to trade their labor in ways that ensure that they’re not dependent on a boss, to run a business or a farm, an independent business or an independent farm, without fear that some Brazilian monopolist or some giant combine is going to come in and just put you out of work tomorrow, take away your property at a whim.
Markets are institutions that we make to provide us with liberty, and the left forgot that. Many people on the left, not all people, but many people on the left forgot that, and that’s in some ways one of the most important things that people have to learn, is that there is no such thing as a market that exists around us. Markets are things that we make to serve our fundamental interests.
|Stacy Mitchell:||Barry, this has been a terrific conversation. Thank you so much.|
|Barry Lynn:||It’s been great to talk to you.|
|Stacy Mitchell:||Thank you for tuning into this episode of Building Local Power. You can find links to what we discussed today by going to our website, ILSR.org, and clicking on the show page for this episode. That’s ILSR.org. While you’re there, you can sign up for one of our newsletters and connect with us on Facebook and Twitter. Once again, please help us out by rating this podcast and sharing it with your friends. This show is produced by Lisa Gonzales and Nick Stumo-Langer. Our theme music is Funk Interlude by Dysfunction_AL. For the Institute for Local Self-Reliance, I’m Stacy Mitchell. I hope you’ll join us again in two weeks for the next episode of Building Local Power.|
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