An excellent change. It's unfortunate that stewardship of the committee will soon change hands as Khan has been a great advocate for fair contracts between companies and consumers during her tenure.
The idea that these institutions, like FTC, are bad for consumers, and this new blind faith that things must be deregulated because the market will solve it for the better is going to be interesting.
By the way, when things turn bad, it's we who will pay the price again for this deregulation, not billionaires. It's like people are choosing fantasy and magical thinking over History... 2008 wasn't that long ago.
It feels like she's just against any acquisitions by large companies, and I think that's both too broad of a stance for the FTC to take (as opposed to really looking on a case-by-case basis of whether consumers would be hurt by an acquisition) and also harmful to new companies being created, since suddenly an important option for exits is a whole lot less likely as large companies hesitate to be acquisitive.
How does her term work?
Seats on the FTC are supposed to last for 7 years. She was nominated in 2021 and her term technically expired a couple months ago. Apparently she gets to remain in it until a replacement is appointed.
Has she just been filling in the remainder of someone else's term, like Laphonza Butler as CA Senator?
The prior chairman, Joseph Simons, had this same seat that Khan has now, so for him his term was also nominally set to expire September 2024. He resigned when the administration changed over in 2021.
But this looks genuinely good! It's basically banning fraud.
---[EDIT], since everyone is asking for reasons here are two libertarian/conservative critiques:
EDIT: to make it easier here's a list of actions from perplexity:
Here are more explicit actions taken by the FTC under Lina Khan's leadership:
Lawsuit against Amazon (2023): The FTC filed a landmark antitrust case accusing Amazon of monopolistic practices in its online marketplace and Prime subscription service.
Meta (Facebook) lawsuit (2023): The FTC sued Meta to block its acquisition of virtual reality app maker Within Unlimited, citing concerns about monopolization in the VR market.
Microsoft-Activision merger challenge (2023): The FTC attempted to block Microsoft's $69 billion acquisition of Activision Blizzard, though it ultimately failed.
Kroger-Albertsons merger: A U.S. district court judge ruled in favor of the FTC to block the proposed $25 billion merger between these two major supermarket chains
Nvidia's acquisition of Arm: The FTC sued to block this merger, though it's not explicitly mentioned in the search results
Amazon's acquisition of iRobot: While not explicitly mentioned in the search results, this is another high-profile merger that the FTC has challenged under Khan's leadership.
Enforcement against data brokers (2022-2023): The FTC took action against several data brokers for selling precise geolocation data that could be used to track people's movements.
Zoom settlement (2021): The FTC finalized a settlement with Zoom over allegations of deceptive security practices.
Right to Repair initiative (2021): Khan's FTC unanimously voted to ramp up law enforcement against repair restrictions that prevent small businesses, workers, and consumers from fixing their own products.
Made in USA labeling rule (2021): The FTC finalized a new rule cracking down on marketers who make false, unqualified claims that their products are Made in the USA.
Penalties for fake reviews (2022): The FTC imposed multi-million dollar penalties on companies for using fake reviews and suppressing negative reviews.
Action against "dark patterns" (2021-2023): The FTC has taken action against companies using deceptive design practices known as "dark patterns" to trick consumers.
Increased use of Penalty Offense Authority: The FTC has revived its Penalty Offense Authority to seek civil penalties for violations of FTC administrative orders.
Ban on hidden junk fees: The FTC announced a rule requiring companies to show full prices for items like hotel rooms, concert tickets, and sporting events upfront, rather than hiding fees until the end of the checkout process
Changes to merger review process: The FTC has altered principles, practices, and policies of merger review that had been in place for decades
Expanded scope of enforcement: The FTC has taken a more holistic approach to identifying harms affecting workers, independent businesses, and consumers, with a focus on addressing power asymmetries and unlawful practices
Rulemaking changes: Chair Khan has orchestrated wholesale changes in FTC rulemaking practices and policies
Proposed ban on noncompete clauses: The FTC has proposed banning noncompete clauses in employer agreements
Increased focus on data privacy: The FTC has sued multiple companies for allegedly sharing customer data and warned about the "hidden impacts" of advertising tools like third-party tracking pixels
But every sport punishes competitors who are cheating or being unsportsmanlike. As it should be in the marketplace. But hackers and the EU and US bureaucrats think that being a leader in a market has to be punished for being a "monopoly". While always turning a blind eye to rampant fraud and scams that are in the marketplace everywhere online and offline.
Almost all North American sports have a player entry draft, where the weighting is based on your success. The best teams (eg the Detroit Red Wings of the 90’s and 00’s) are given garbage draft picks, while the bottom-feeders (eg the Edmonton Oilers of the late 00’s-early 10’s) are given (the opportunity for) superstars. This is clearly a punishment for doing well, and a reward for being terrible.
Did he cheat? No, everyone used a similar amount of steroids. But to anyone with eyes and a basic knowledge of the sport it's overwhelmingly obvious that the organizers and judges threw it in his favor because of the attention it would bring.
Which is the issue when an entity becomes too big to fail. There is a power disparity that is virtually impossible to overcome as the leverage is so much that any opponent can be swat down with ease.
Things such as:
- leveraging economies of scale when dealing with suppliers and resources to the point of starving access to competition
- using lobbyists to write legislation in their favor or blockade opponents
- doing fuck all with no reservations, then pay out lawsuits and fines at an order of magnitude less than profit made and damage done
This is a provocative claim. Do you have any examples?
Constantly winning in a competitive environment with no runaway feedback loops[0] is evidence of cheating.
See also, casinos: the "legitimate" ones don't rig the game - they know the odds; they expect you to win something here and then, but if they see you winning consistently, they'll rightfully assume you're cheating somehow, and ban you from the venue.
> But every sport punishes competitors who are cheating or being unsportsmanlike. As it should be in the marketplace.
Marketplace isn't like sportsball. It's like war. On the market like in war, anything goes. The only people who can afford living under delusion of market sportsmanship are people who are already so well-off and safe they can treat it as a game; for everyone else, it's a matter of life and death.
> But hackers and the EU and US bureaucrats think that being a leader in a market has to be punished for being a "monopoly".
The market isn't some divine ball game, or a magic ritual. It's a feedback system, with known failure modes. Wrt. monopolies, in particular, any good profit-seeking actor will aim at becoming a monopolist in their market segment, because that's how they can maximize profits while minimizing effort. At the same time, the market serves a critical function in organizing human society - but that stops working when monopolies pop up.
It's really very simple: all the goods and services and advancement we enjoy require market players to be actively putting in effort. To society, an entrepreneur is basically a donkey with a pole mounted to it, from which there hangs a carrot, just out of reach - the donkey just wants to grab the carrot, but the society only benefits when the donkey is chasing it. The donkey needs to believe they can win, so it keeps running, but it also can never be allowed to actually get their prize, because then it'll stop. That's why markets are regulated as to let people and companies grow and accumulate winnings, until a point, past which they'd stop participating (or worse, just go screwing around breaking things).
I.e. it's not about punishing someone for winning - it's about preventing them from complete victory, because then they become useless to society.
> While always turning a blind eye to rampant fraud and scams that are in the marketplace everywhere online and offline.
Who's turning a blind eye to it? Fraud and scams are the base state of the market; it's what it decays to if left to its own devices. Regulations are there to counteract this tendency.
--
[0] - Feedback loops like compounding interest. In sports, unlike in the economy, you can't just reinvest your win to get more wins, and then reinvest them in turn, until you're winning so much so fast that no one can ever hope to catch up with you.
Right. How did Usain Bolt cheat? How did Michael Phelps cheat? How did ABBA cheat?
> any good profit-seeking actor will aim at becoming a monopolist in their market segment
Of course. And then hackers redefine the market segment to encompass that businesses product and ta-da, you have a monopoly. Like Apple.
If we're talking about real monopolies, then I couldn't agree more. But what hackers and the EU are doing is redefining monopoly in a dishonest way because they have personal grudges against a company.
> The donkey needs to believe they can win, so it keeps running, but it also can never be allowed to actually get their prize, because then it'll stop.
Here's something to blow your mind: The donkey enjoys running. Or let's take a real life example: sled dogs. They love pulling the sled. Entrepreneurs love working and love competing. Those who don't love it usually pull out of the game with their profits way before they have even national impact.
This is a huge divide in attitude I've seen everywhere in the world in my life. You have category X of people who see all kind of work as an immense suffering. They complain endlessly, do the minimum effort, and never get anywhere. And you have category Y of people who love working, because it's doing something productive and learning. That doesn't mean that they're satisfied with being abused wage slaves. Rather it is the first category who never advances in life, because they think it's all a scam. People in the second category also fail a lot because they take chances. But they usually get up again.
> Who's turning a blind eye to it? Fraud and scams are the base state of the market; it's what it decays to if left to its own devices. Regulations are there to counteract this tendency.
All governments and law enforcement seem to be turning a blind eye to it. About 50% of advertisements on Facebook and Instagram are outright scams, ie physical products from brand names that are advertised at bargain prices and if you "buy" it you will not get delivery because it is an outright scam. US and EU governments should fine Meta billions of dollars for having their main source of income from organized crime and fraud. But they are focused on completely irrelevant crap like app stores. Talk about sieving mosquitoes and swallowing camels.
So your analogy is very terrible, unless Simone Biles was bribing sports officials to change the rules to effectively prevent other gymnasts competing against her.
A better analogy for a monopoly in a free market is allelopathy in plants, where you actively modify the environment to starve out competitors.
Pro-market: pro-market advocates for policies that enhance competition and market efficiency. Understands that god markets are made. Pro-market advocates believe in creating conditions where businesses can compete fairly without undue advantages from government favoritism. Government regulation can be essential to correct market failures and promote a level playing field.
Free market: and ideological stance where markets are without government intervention. Belief in ideal world where market failures don't exist and if they exists that's a good thing.
Realist: "the free market has flaws, which can be addressed by..."
Replace "free market" with anything you like
> accepting a situation as it is and being prepared to deal with it accordingly.
or
> representing a person or thing in a way that is accurate and true to life.
The definition of realist has flaws...
Where the free market fans see child slavery and sexual slavery and rejoice (free to make any contract you want to after all), the pro market people believe that if you just put enough guard rails on it, greed will magically turn into a force for good.
Obviously I also have an ideology, but at least I'm honest enough to not pretend that capitalism (or communism/anarchy) are naturally occuring, instead of simply a choice we make.
no, markets without government intervention are called "laissez-faire" markets. There would be no need for that term if that's what free market meant.
I'm not following here: are you suggesting that given any two different words, it is impossible for them to refer to the same thing or mean the same thing?
There'd always been a belief in early capitalists that an unregulated market would be inherently self-regulating from competition, in a way that allowed for competition, and yeah, well, I would emphasise the word "belief" in that.
I once met a theologian who had done their PhD on the language used by a politically powerful neoliberal group in their writings on the market and came to the conclusion that it was primarily the language of faith, not the language of science.
Shit, even Hayek opposed laissez-faire markets in some areas.
That was probably before the internet was invented. These days, a typical online libertarian opposes all government action as violence, but when you mention fraud, it's like: "but who decides what is or isn't fraud? if the customer signed a contract, it was their revealed preference to get scammed..."
I totally understand why billionaires do, on the other hand. Worth watching Reid Hoffman embarrass himself on Jake Tapper on the subject of Khan recently for those interested
We're at an unprecedented levels of wealth inequality in America. Billion dollar businesses built on tax payer money, should contribute to the system. Instead we've designed a system where these companies would rather pay millions of dollars in campaign contributions and to lobbyists.
The free market shouldn't allow monopolies, or duopolies to form. Bad businesses should fail, not absorb more capital and continue scaling.
We have a dysfunctional Congress that can't/won't legislate to fill gaps that emerge over time with new circumstances. Someone will step in to fill those gaps. Sounds like you'd prefer to have corporate execs do so, focused largely on their stock prices, bonuses, and promotion prospects — cf. paperclip-maximizing AGIs [0] — than to have a citizen-advocate do so.
[0] https://www.lesswrong.com/tag/squiggle-maximizer-formerly-pa... and https://en.wikipedia.org/wiki/Instrumental_convergence
to the contrary, she's great for free, competitive markets
she's just not good for winner-take-all M&A investors, and _that_ is a good thing
the average American - and even the average investor - will not benefit from her departure
The paragon of good and sensible arguments like, "Legalize Insider Trading".
This author has not written one of those pieces, but she is in good company with the ones who did.
It says that she has been bad for them but there is no proof of this.
Instead it makes quite a comical attempt at trying to vaguely point at the sky and say she is evil or overreaching, but she is not and anyone whoa actually wants a free market can tell you that. I honestly just cannot understand what happened to Reason I checked some more or their side articles and wow the quality has dropped to a level that would make the NYT blush.
The main complaint is that the Khan FTC by default is against all mergers and acquisitions.
This is different from the previous standard that only mergers that harm consumers are bad. So now even mergers that benefit consumers are blocked.
The Reason piece is lazy drive-by snark. Calling the anti-trust standards of the 20c "hipster anti-trust" is just a-historical. Blocking consolidation of national chains is hardly some crazy innovation. In fact, it was Bork who was the rebel introducing the stricter "consumer harm" standard. People might argue which is the appropriate standard -- the one invented during the 1890s to break the most powerful trusts in history, or the one invented by a Regan appointee in 1980 to replace it. But the Reason snark does nothing except claim it.
At least the WSJ makes an actual argument about consumer harm. Unfortunately, their argument is: there has been so much consolidation in distribution, we need to consolidate retail to increase their bargaining power to balance. Given the geographical nature of grocery shopping, consolidation is likely to reduce consumer bargaining power further. That the WSJ fails to acknowledge the obvious fact that the greater power of a merged entity would act on both sides of the market is bad-faith.