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Antitrust laws are too reactive. We need proactive laws that break up companies if they grow beyond a certain size criteria. Ideally, the criteria would be aggr

• mikepurvis 3y ago
  Is there a model anywhere for this having been tried, successfully or otherwise? The obvious hesitation I have is just that some companies really do benefit from a lot of vertical integration. Could Apple be Apple if they were forced to spin off the phone business, or the chip design house, or the OS? What would it mean for the startup ecosystem if getting bought by a conglomerate was a less plausible exit? How would regulators enforce that the split off entities were truly independent vs faking it and then having exclusivity deals that meant they were basically still the same singular entity?
  • dmbche 3y ago
    Should Apple exist in it's current form? If it weren't, the things that are integrated become available for others - meaning better products for all, no? What's the societal benefit of integrating all these advances in single companies?
    • vlovich123 3y ago
      Not so much because then, for example, you become Qualcomm and have 50 different customers all asking for different things from your chips and you reach a local optimum where you solve everyone’s issue a little bit but don’t actually do a good job. There’s a reason that Apple’s chips are so much better in terms of performance and energy efficiency. Similarly, it’s why Apple did the W1 first and it took a very long time before any competitor figured out how to do the same thing. And you’ll see the same with VR where FB will struggle to make HW with comparable specs while Apple’s chip gives their SW a leg up. TLDR: it’s complex, but successful vertical businesses have fairly different products, efficiencies, and outcomes.
      • dmbche 3y ago
        Thank you for the answer! My first thought is that the "apple Qualcomm" that would come out would have incentives to make better chips without needing to also sell phones (competing with other chip manufacturers) but I can understand that the chip industry is very costly and risky, I can see how without integration they can't compete with any current player - too expensive and risky.
      • bogwog 3y ago
        Apple made better chips than Qualcomm because Qualcomm is a monopolist, and thus doesn’t need to actually compete. The moment a competitor sprung up, they got their ass kicked. Yes, no other company but Apple could have pulled that off, but that’s only because Apple themselves are a monopolist with the market power to fight another monopolist. That’s not a good thing. The solution to monopolies isn’t more monopolies. A much smaller company than Apple could have theoretically created a better processor than Qualcomm, but it just couldn’t happen due to multiple anti-competitive factors. Like how Qualcomm has a patent portfolio that gives them a monopoly on 4G modems, and can use that to force companies to purchase other components from them if they want a modem. https://www.cnet.com/tech/mobile/qualcomm-us-ftc-apple-chips-smartphones-phones-patents-monopoly-court/ https://www.cnet.com/tech/mobile/qualcomm-us-ftc-apple-chips...
        • jonhohle 3y ago
          I ask this every time it comes up, but what exactly does Apple have a monopoly in? They don’t control majority of anything in any category that they participate in. They are a major purchaser of high end fab processes, but that doesn’t allow them to control PC, phone, steaming, messaging, audio, home integration, or any other market. They are one of the most vertically integrated large companies, but they are allowed to monopolize their own products. There is no iPhone market - that’s a product within a huge market of other mobile devices that anyone can join.
          • bogwog 3y ago
            These types of discussions on this site are pointless. I can tell that no matter what I say, you’re going to end up moving the goal posts. Why do I know this? Because you non sarcastically are trying to say that Apple doesn’t have a monopoly. The amount of mental gymnastics is takes to frame it that way is only possible if someone cares more about defending the honor of their favorite megacorp than finding any kind of truth. And if I’m completely wrong about you, then I apologize. My patience for these internet arguments isn’t what it used to be. To answer your question, there are no doubt thousands of comments on this website about that topic. Ignore the ones that seem to come from Apple fanboys, and you’ll find the right answers.
    • kylehotchkiss 3y ago
      Substantially less opportunities for your private data to be hacked and leaked all over the web. I think Apple’s long term privacy and e2ee pushes and googles recent attempts at the same would not exist across a pile of medium sized companies. iCloud Photos leaking would continue to be a thing.
  • ehnto 3y ago
    > What would it mean for the startup ecosystem if getting bought by a conglomerate was a less plausible exit? I guess going public would be the move realistically. I would prefer to see a shift toward startups aiming for solvency though, which I believe would make better companies. Companies that fit a role in society better. Free market capitalism isn't really happening if consumers aren't paying for anything and the money rains in from the VC heavens instead.
• colordrops 3y ago
  It's similar to the two party system at this point, where the powers are so entrenched that they control the regulatory bodies that could change anything.
• lolinder 3y ago
  I agree that antitrust is too reactive, especially in tech, but when it hits the real world your proposed solution would just lead to a new Byzantine maze like our current tax code. We'd get a whole new industry built up around helping corporations to technically stay under the thresholds by exploiting loopholes (and another industry for lobbying for those loopholes to be expanded).
  • deleted 3y ago
    [deleted]
  • bbor 3y ago
    This could be used as a criticism of literally any law of any kind.
    • charrondev 3y ago
      Precisely. Laws and regulations are overly complex, and as a result open many opportunities for corporations pay for carve outs for themselves, enriching themselves at the expense of the public.
    • wahnfrieden 3y ago
      Yes, see the entire field of anarchism
  • ghayes 3y ago
    My spitball solution is to add an excise tax on revenue based on market concentration, potentially paid back to consumers or new market entrants. So if you own 50% of a market, maybe you pay a 25% excise tax, and thus the market finds an equilibrium except in cases where a monopoly is warranted, despite the high tax.
• hintymad 3y ago
  > and the elimination of Big Corp's big money political influence. And companies like Google have more than just "big money political influence". YouTube banned discussions on legitimate discussion of Covid and politics in the past few years, for instance.
  • skinkestek 3y ago
    As someone who has taken my vaccines and are anti anti-vax: I think this is true and it hurt us.
• nicoburns 3y ago
  I feel like we ought to have progressive taxation on corporations: the larger you are, the more you get taxed. This would act as a general purpose biasing of the economy in favour of smaller companies and more competition.
  • barnabee 3y ago
    I'd strongly welcome this, based on both size and profitability (which should also include money going to salaries above some level per employee, as well as accounting profit, dividends, etc.).
  • gottorf 3y ago
    What we have currently is the other way around, unfortunately: the larger you are, the more efficient it is for you to be "compliant" with various laws and regulations. The same way that a billionaire wouldn't mind paying half a million dollars to an accounting firm to optimize their taxes another 1-2%, whereas someone making $50k a year would just use the free version of TurboTax and maybe miss out on some deductions. This (among other things) contributes to the trend of increasing consolidation in virtually every industry in America.
    • elteto 3y ago
      While I agree with you, people making $50k a year are not missing out on many deductions. Putting its parent company aside, Turbo Tax is not a bad product for simple taxes at that income level. What they are missing out is alternative investment categories only available to those with more money, or estate planning solutions that are expensive to setup.
• lordnacho 3y ago
  Bigger fines and liquidation on misbehaviour.
• huitzitziltzin 3y ago
  The point of antitrust law is to protect competition. It’s not to protect small firms nor to prevent the emergence of large ones. The kind of law you want is different, and in my opinion as an antitrust guy a very bad idea. To my knowledge no such law exists in any industrial democracy.
• raincole 3y ago
  Yeah and other countries won't follow suit. Congrats, you yield all the economics of scale to China. What now? "Export" the US's domestic laws to other countries like it always does?
  • bbor 3y ago
    We would be more efficient if we made the work week 80 hours minimum, at the small cost of people's happiness! China would stand no chance. In case I'm unclear, I feel that not keeping our economy diverse and fair because China might make more stuff than us if we do is very misguided.
    • thfuran 3y ago
      >We would be more efficient if we made the work week 80 hours minimum No, we wouldn't.
  • 0xDEF 3y ago
    >Congrats, you yield all the economics of scale to China That is the goal and why "Break up Google" is being aggressively pushed by pro-Chinese bots on reddit, twitter etc. "Break up Google" should be translated to "Give all the data to China". Before the rise of TikTok I would as a European have supported the US shooting itself in the foot by breaking up Google, Microsoft etc. I assumed those would be trivially replaced by European alternatives. However today, post-TikTok, I know the majority of people will just eagerly jump on the first Chinese spyware alternative that pops up.
• jahewson 3y ago
  This gets you cartels, where the top players collude.
• summerlight 3y ago
  > We need proactive laws that break up companies if they grow beyond a certain size criteria. Even assuming that this is a good idea, this have an unnecessary risk of being unconstitutional and getting scrapped by the justices. If you want to limit property rights in this fundamental way, that has to be based on a very strong judicial basis. That's why almost all reasonable antitrust regulation happens in a reactive way, because it has to prove that those regulated entities are actually doing something harmful.
  • arrosenberg 3y ago
    The constitution says nothing adverse to regulating entities that are not actively doing harm (though I disagree). Congress can write any standard they want into law if you get the right legislators in a room. Antitrust is reactive because consolidation is a slow burn and it takes a while for a critical mass of voters to feel the problem. Thats why Obama and Biden have taken completely different approaches, despite being ideologically similar.
    • summerlight 3y ago
      Regulations have to happen in a "Necessary and Proper" way (see 8.18). The Congress is delegated with a strong legislative power, but it's not something limitless.
      • arrosenberg 3y ago
        That clause basically says “Congress shall have the authority to make laws that enable it to execute its powers”. It has nothing to do with what you said. Its there to prevent judicial chicanery, not encourage it.
  • TheCoelacanth 3y ago
    People have rights. Trillion dollar corporations should not.
• vharuck 3y ago
  It would also have the benefit of making supply chains more robust. Baby formula prices shot up during the pandemic because one factory had a contamination problem. My sister-in-law was asking friends on Facebook to look in their local stores for a specific type of formula her baby needed, because her store has empty shelves of it for a month. The free market wasn't solving that problem. A new baby formula factory can't just be built to cover a gap that'd probably disappear in a year. But that leaves people in a shitty position for a year.
  • yjftsjthsd-h 3y ago
    > The free market wasn't solving that problem. By the definition I learned in school, that's not a free market, precisely because it can't scale on both supply and demand sides. If it can't be (if factory startup costs will always be too high) then that's an argument for regulation to offset the problem, but it's not a free market problem.
• Animats 3y ago
  > We need proactive laws that break up companies if they grow beyond a certain size criteria. Which is what the Sherman Act says: "Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other per- son or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $100,000,000 if a corporation, or, if any other person, $1,000,000, or by imprisonment not exceeding 10 years, or by both said punishments, in the discretion of the court." It hasn't been rigorously enforced since the 1960s, but the Department of Justice does have the option of enforcing it as written.