Is Warren’s Plan to Break up Big Tech a Solution to America’s Second Gilded Age?

Emma Theisen, Scarlet Staff

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One of the pillars of Presidential candidate Elizabeth Warren’s campaign has been her plan to “break up big tech.” According to her campaign website, this would consist of two main steps: first, creating legislation that requires large tech platforms to establish a structural separation between platform utilities and participants, and second, appointing regulators for this legislation. With this plan, Warren expects competition to increase and the market to thrive, as small companies will have the space they need to grow.

Many people who disagree with Warren’s plan suggest that these decisions should be made by the market, not the government. This is a very neoliberal idea, as proponents of neoliberalism reject the state-led characteristics of other political ideologies. Neoliberal economists like Adam Smith also believe in the power of the free market to regulate itself, due to a concept called “the invisible hand.” This suggests that, in a perfect market, prices and wages will automatically adjust to what they must be, due to the market competition and supply and demand. These economists also cite tradition, monopoly, and state regulation as obstacles to a properly working market. So, while it may not be ideal to have the government intervene in the market, the growing monopolies may be more dangerous to our economy.

As many followers of the news know, the security of many users of Facebook has been compromised in the past couple of years due to the fact that our “user data” is the main way Facebook gains revenue. This is why ads for things we have in our search history or have clicked on, can appear on our feeds. According to social contract theory, citizens decide to enter into a governed society as long as the government can protect us. If large companies like Facebook can have access to our entire lives through their platform, isn’t it logical for the government to protect us from these companies using their power to corrupt their users? 

Amazon and Google are also large tech monopolies, but operate slightly differently. These platforms use their power to, for lack of a better word, kill their potential competition. They are able to purchase smaller companies and force them to sell at discounted rates, which often causes them to become bankrupt. Further, these massive companies are able to promote their own products. AmazonBasic items are cheaper and there is such a great quantity of them throughout the site, that they are often more appealing to consumers. Google is able to put its reviews above Yelp when you search for a restaurant, getting them more hits than the competing site. Having this power gives big tech companies the ability to control what consumers see, and it is fair to be concerned by that fact.

Some scholars, like Robert Reich, have begun to consider this time period, full of large tech companies, as a second Gilded Age. For context, the Gilded Age was a time where robber barons created big companies like Standard Oil. These companies monopolized the market, defeating and absorbing any possible competitors. Thus, President Roosevelt formed the Sherman Act, one of the three main antitrust laws in our country. These acts are put in place to prevent monopolization or unfair methods of competition. These acts were found to be violated in the case of United States v. Microsoft Corp. Due to the precedent set by this case, it is within the government’s jurisdiction to sue companies that have become monopolies, even though CEOs like Mark Zuckerberg oppose all regulation. 

Because Facebook is the most accessible monopoly to most of us millennials and gen z-ers, let’s return to it for a moment. We have seen Instagram – one of Facebook’s branches – continually develop and unusually become more and more like Snapchat, another popular social media platform. Instagram has introduced stories, and recently a new app called Threads, that is advertised as a “camera-first messaging app that helps you stay connected to your close friends,” which sounds a lot like how someone could describe Snapchat. Further, there has definitely been a shift from teens talking about how their streaks might die, as if it’s the end of the world, to teens using Instagram stories more often, and jumping more quickly on the trends they see through that site. There are clear indications that the Facebook empire may soon enough be the only social media empire, but with its background in user exploitation, Russian collusion, and overall user unease, maybe Warren’s plan is just what citizens need to regain their security online.