Archives for August 2020

Tech Policy and the 2020 Election: Antitrust and Big Tech

By: Jennifer Huddleston

Introduction

Is Big Tech too big, and do companies such as Facebook, Apple, Google, and Amazon need to be broken up via antitrust action? Have we moved into a new age of “cyber barons”? Criticism of large tech platforms and discussions of antitrust action have come from both the left and the right recently. Many of these criticisms do not reflect the underlying principles of antitrust law, but instead reflect other policy concerns such as data privacy and content moderation. Given the criticism from both sides of the aisle, it is not surprising that both presidential candidates have suggested that they would engage in further antitrust scrutiny of large tech platforms if elected.

Liberal Criticisms Regarding Existing Standards

Democratic criticisms of current antitrust largely suggest that enforcement is not aggressive enough and does not account for practices that harm workers and stifle competitors but are not seen in economic harm to consumers. For example, the Biden-Harris platform supports modifying antitrust laws and ties the need for such modifications to “empowering workers.” More generally, criticisms from the left argue that the current approach to antitrust law does not properly account for all the harms to a market by large firms’ behavior and that a more flexible, policy-based approach should be used for more zealous antitrust enforcement.

There are two main problems with such criticisms. First, a more flexible and broad policy-based approach to antitrust would create greater uncertainty for consumers, innovators, and competitors. The prior rule of reason approach stifled beneficial mergers or changes out of an unjustified concern. This approach also tends to focus on the impact on competitors rather than on consumers’ welfare and a properly functioning market.

Second, even the supposed problems have not been shown to be truly harmful or even actually exist. Arguments about the use of data for house brands by Amazon is not that different from the behavior traditional retailers such as Target or Walmart have engaged in for decades. The idea of a “kill zone” (where big tech companies buy out small companies before they can challenge them) appears to be largely a myth and instead has provided more options for startups and investors as well as improved products for consumers. Concerns about market concentration often miss changes in market dynamics or differences in competition at a local versus national level.

Moving away from an objective standard of antitrust might not benefit the very consumers competition law was intended to protect and risks providing a dangerous way for political motives to intrude into an already competitive market. Such politicization could increase the abuse of antitrust law such as the Trump Administration Department of Justice’s alleged use of antitrust to review mergers in the cannabis industry based only on its dislike of the product.

Conservative Critiques of Antitrust

Calls to break up Big Tech have not only come from the left but also from policymakers on the right. Conservative criticisms often allege that the companies are abusing market power to silence conservative voices and argue that breaking these companies up would solve a litany of non-competition related policy concerns. The Department of Justice during the Trump Administration has been actively pursuing potential antitrust claims against the largest tech companies. The president himself has suggested more use of antitrust law against large tech companies, even applauding European Union fines against American tech companies. But as with the criticisms from the left, these proposed solutions might make the alleged problems even worse.

Breaking up “Big Tech” would not solve concerns about anti-conservative bias, content moderation, data privacy, or any of a litany of non-competition policy concerns. Such a policy motivation is not the appropriate use of antitrust and would be better addressed by more targeted policy reforms if needed. In fact, using antitrust to require a breakup might even make these problems worse. Smaller firms would have more limited resources to devote to tasks such as content moderation or data security and might find themselves engaging in more advertising or data usage without the efficiency of a large company. The result is far from a guarantee that these now separated companies would better respond to these policy concerns or be more friendly to conservatives. As former Senator Rick Santorum recently wrote, “Going back to the media of 25 years ago would not go well for the President or for conservatives…. As America wrestles with so many tough issues and prepares to select its leaders in a charged partisan atmosphere, social media matters. And social media matters more to the election prospects for conservatives than it does for progressives.”

Using antitrust for more political purposes not only risks undermining those purposes; it risks unnecessary government interference in a free and competitive market. The result again could easily be that consumers lose out on potential mergers or efficiencies that would have benefited them. In some cases involving technology, the result could even be an increase in costs for once zero-cost products.

Conclusion

The current approach to antitrust is principled and objective with a focus correctly on consumers. As a result, it is a tool to allow competitive markets to continue to flourish while providing a principled mode of correction when anti-competitive behavior arises. Such a standard is adaptable to fast-moving, innovative fields as well as more traditional markets. As conversations around antitrust and Big Tech are likely to continue under either a Trump or Biden Administration, proposed changes to antitrust would likely bring with them new problems as well as fail to cure existing ones.

Jennifer Huddleston is the Director of Technology and Innovation Policy at the American Action Forum.  @jrhuddles

California ‘Dream Team’ Wants Arizona’s LD-6

By Eddie Whipple

For years Arizona has had to fight off the influence of Californians who want to meddle in our way of life.

“Don’t California my Arizona,” is a rallying cry for many conservatives who want Arizona to remain a state of low taxes with few government regulations, where families and businesses can thrive with limited governmental intervention.

However, more and more we have seen an influx of California-influenced political ideas invading our desert and mountain regions.

Just two years ago, Tom Steyer spent tens of millions of dollars to reengineer our electric grid by mandating solar consumption and significantly increasing our electric bills. Thankfully, voters up and down the state soundly rejected that bad idea. Steyer did not begin the effort to bring bad California ideas to Arizona. And sadly, his resounding defeat wasn’t the end, either.

Now, in Legislative District 6, which covers the White Mountains area, along with Flagstaff, Sedona, Payson and parts of Yavapai County.

The “California Dream Team” of Felicia French, Coral Evans and Art Babbott is running to take out the two current members of the Arizona House and Senate candidate Wendy Rogers. And LD6 isn’t your typical district. It’s one of the biggest targets for Democrats to flip from red to blue. Republicans hold 31 seats in the House, with the 29 Democrats closer than at anytime in 60 yeas from having control of the body. In the state Senate, Republicans hold 17 of the 30 seats. Capturing these seats is the lynchpin to the Democrats taking over the state House and leading them on the path to the same outcome in the Senate.

French, who is taking on Rogers for the Senate seat, loves her some San Francisco area cash. According to campaign finance records, she has received at least $18,000 from more than 100 Bay Area donors. And her campaign rhetoric matches her liberal donors. 

She buys into the wackiest of liberal policies. She supports cutting beef production by 50 percent to cut down on global warming. Cows, she reckons, contribute to global warming. Never mind that ranching is one of the most important industries in the district.

Flagstaff Mayor Coral Evans never met a tax increase she couldn’t support. She once said at a Hillary Clinton rally she would be a “hard-bent progressive.” She’s living up to her own words. She once compared celebrating Columbus Day with waving the Confederate Flag and she wants to replace that October holiday with Indigenous Peoples Day. She has supported the Invest In Ed income tax proposal that would increase taxes on small business owners and create California-like tax structure that will drive away businesses and residents. She has supported property tax increases in Flagstaff for many of her years as mayor. One of her top priorities in the Legislature she once said was to increase the gas tax.

Babbott, a Coconino County supervisor and running as an independent but aligning with Democrats, has spent decades supporting Bernie Sanders’ various runs for office. He first began donating to Bernie’s campaign as early as 1990. In 1987, Babbott said the self-described “Radical Socialist Mayor” was doing a “great job.” He’s given nearly $1,000 over the years to Bernie’s campaigns and supported his 2016 run for the presidency.We’ve seen the evidence that French, Evans and Babbott are as liberal as they come. Now it’s up to the voters to take that into consideration when they fill out their ballots. The direction of the state is may just come down to these three Democrats.

National Council on Disability releases Statement Opposing Importation of IPI

Importation of the IPI in the U.S. will restrict access to prescription medications for the millions of Americans who rely on Medicare Part B due to the IPI’s reliance on quality-adjusted life years (QALYs) – a formula used to assess the value of medications by assigning a lower value to the life of a person with an illness or disability

WASHINGTON—The National Council on Disability released the following statement:

Making prescription medicines more affordable is a proper and necessary goal for the U.S., but it is not in the best interest of Americans to import price controls from countries that use the International Pricing Index (IPI) to determine U.S. drug pricing.

Importation of the IPI in the U.S. will restrict access to prescription medications for the millions of Americans who rely on Medicare Part B due to the IPI’s reliance on quality-adjusted life years (QALYs) – a formula used to assess the value of medications by assigning a lower value to the life of a person with an illness or disability.

To date, QALYs have been deemed contrary to U.S. public policy because of the discriminatory design and impact on people with chronic illnesses and disabilities. NCD’s 2019 report on QALYs describes their consequences on people with chronic illnesses and disabilities in countries with government-run health systems that use the IPI. Where Americans enjoy broad access to the most effective and cutting-edge medications available, people in IPI countries have dramatically less access to important drugs, including denied or restricted access to the most effective drugs for cancer and other serious medical conditions.

Medicare and Medicaid have not relied on value assessments that use QALYs for prescription drugs but importing the IPI will most certainly reduce access to quality healthcare for Americans by limiting or restricting access to medications. It will also import the use of QALYs, which run counter to U.S. civil rights laws that prohibit healthcare discrimination against people with disabilities.

For the benefit of all Americans who rely on nondiscriminatory access to the most effective prescription drugs to treat their individual conditions, NCD urges the Trump administration to abandon its plan to use IPI and to examine alternatives that do not rely on QALYs or other discriminatory metrics.

America Needs Conservative Journalists!

Journalism is among America’s least trusted professions. I know, that’s not a big surprise…

In fact, when asked if they trust the honest and ethical standards of the media, Americans put journalists below most professions, and trust them only slightly more than car salespeople and Congressmen.

Now, more than ever, conservative journalists must use their voices to report the facts and speak over all of the lies. 

If you’re interested in a career in journalism, now is the time to be proactive. 

The Leadership Institute’s annual Journalism Career School will help you succeed in journalism by teaching you the skills to succeed and build your network of conservative journalists. 

Click the link below to learn more and register!
What: Journalism Career School
When: Thursday – Friday, September 17 – 18 | 9:00 AM – 5:30 PM EDT
Where: Online
How to register: Sign up by September 14 for $40!
Register here
Whether you aspire to be on television or pursue a career as a writer, the Journalism Career School will give you the tools to succeed.

You will learn how to:Traditional Journalism: You will learn how to get a job with a publication, build and use contacts in media, and write stories that get you noticed.Broadcast Journalism: You will learn how to get yourself on camera, as well as practice and analyze your television techniques in LI’s studios.Watchdog and Citizen Journalism: You will learn how to build your following online, as well as how to create your own publication and videos that get you noticed!Register today so you don’t miss out!

Conservative leaders say tech anti-trust lawsuits “undermine the rule of law, and negatively impact consumers”

The Honorable David N. Cicilline
Chairman, House Committee on the Judiciary
Subcommittee on Antitrust, Commercial and Administrative Law

The Honorable F. James Sensenbrenner
Ranking Member, House Committee on the Judiciary
Subcommittee on Antitrust, Commercial and Administrative Law

Dear Chairman Cicilline and Ranking Member Sensenbrenner,

We, the undersigned, write to you regarding your July 29 hearing, “Online Platforms and Market Power, Part 6: Examining the Dominance of Amazon, Apple, Facebook, and Google.” We also understand that the House Judiciary Committee has launched its own investigation into these companies and are also reviewing whether changes are necessary to existing antitrust laws. This comes as both sides of the aisle are pushing for the weaponization of antitrust, either as a tool to punish corporate actors with whom they disagree or out of a presupposition that big is bad.

We would like to emphasize the need to distinguish between the proper and improper uses of antitrust in approaching discussions of market power, and are concerned that today’s hearing could lead to the use of antitrust to address concerns surrounding online content moderation, data privacy, equality, or other socio-political issues that are unrelated to the competitive process.

It is important to consider what is at stake. Using antitrust to achieve policy or political goals would upend more than a century of legal and economic learning and progress. The need to bring coherency to antitrust law through a neutral underlying principle that cannot be weaponized is what led to the adoption of the modern consumer welfare standard.[1] It is broad enough to incorporate a wide variety of evidence and shifting economic circumstances but also clear and objective enough to prevent being subjected to the beliefs of courts and enforcers. Abandoning the consumer welfare standard by giving enforcers a roving mandate would shift antitrust law back to the approach of the 1960s when, in Justice Potter Stewart’s words, “[t]he sole consistency that I can find is that, in litigation under [the antitrust laws], the Government always wins.”[2]

It is also important to put today’s hearing into perspective. The current antitrust debate is relevant to far more than just “Big Tech.” The economic consequences of many of the recent proposals would make the American economy and consumers substantially worse off across a wide array of industries. Proposals include aggressive merger prohibitions, inverting the burden of proof, allowing collusion and antitrust exemptions for politically favored firms, and politicizing antitrust enforcement decision-making more generally. Arbitrary or overly-broad antitrust enforcement would hamper our economic recovery and risks job losses—something we can ill-afford as the nation recovers from the COVID-19 economic slow-down.

In sum, weaponizing antitrust for broader socioeconomic purposes would fundamentally alter the primary goal of antitrust, undermine the rule of law, and negatively impact consumers. We ask that this letter be entered in the hearing record. We thank you for your oversight of this important issue. 

Sincerely,

Ashley Baker
Director of Public Policy
The Committee for Justice

Robert H. Bork, Jr.
President
The Bork Foundation

Ralph Benko
Chairman
The Capitalist League

Wayne Brough
President
Innovation Defense Foundation

Tom Giovanetti
President
Institute for Policy Innovation

Douglas Holtz-Eakin
President
American Action Forum

Karen Kerrigan
President & CEO
Small Business & Entrepreneurship Council

Curt Levey
President
The Committee for Justice

Stephen Moore
Co-Founder
Committee to Unleash Prosperity

Katie McAuliffe
Executive Director
Digital Liberty

Doug McCullough
Director
Lone Star Policy Institute

Lisa B. Nelson
CEO
American Legislative Exchange Council

Grover G. Norquist
President
Americans for Tax Reform

Andrea O’Sullivan
Director, Center for Technology and Innovation
James Madison Institute

Eric Peterson
Director of Policy
Pelican Institute

Steve Pociask
President / CEO
The American Consumer Institute

Thomas A. Schatz
President
Citizens Against Government Waste

Pete Sepp
President
National Taxpayers Union

Josh Withrow
Senior Policy Analyst
FreedomWorks

David Williams
President
Taxpayers Protection Alliance

Price Controls Aren’t Solutions

BY DANIEL SAVICKAS

Prices for prescription drugs in the U.S. are far too high. There is no denying this sad reality. According to an analysis done by the House Ways and Means Committee, the U.S. pays roughly four times as much as 11 similar nations for prescription drugs. For millions of patients, families, and caregivers, this is unacceptable. Policymakers are right when they say something needs to be done.

However, it wouldn’t truly be a day that ends in ‘y’ in Washington if the proposed answer from lawmakers didn’t threaten to make the problem worse. Lawmakers of all stripes – from Sen. Bernie Sanders (I-Vt.) to Sen. Josh Hawley (R-Mo.) to even President Donald Trump himself – are proposing to implement price controls in hopes of assuaging the problem.

These lawmakers, especially the self-proclaimed “conservatives” who should know better, ought to heed the sage wisdom from President Reagan’s inaugural address: “Government is not the solution to our problem, government is the problem.” Sadly, the proposal on the table would introduce more government to the equation, not less.

Currently, various lawmakers have proposed some form of an international pricing index (IPI). This concept would tie drug prices in the U.S. to drug prices overseas. The Department of Health and Human Services (HHS) rolled out a proposal in late 2018 that would have capped drug prices in Medicare Part B to no more than 50 percent above the aggregated prices in 14 comparator nations. This is similar to a proposal introduced in the Senate by the aforementioned Sanders.

Fortunately, that proposal seemed to go the way that most socialistic schemes do: to the dustbin of history. Unfortunately, there are credible rumors that the White House is attempting to revive it with the added twist of the knife in the form of a “most favored nation” provision (MFN). Said provision would ensure that, amongst developed nations, the U.S. would have to have the lowest prescription drug prices. In other words, the U.S. will have the most stringent price controls in the world. This is a problem.

While the U.S. does have unacceptably high drug prices, there are a number of reasons why we are still higher than the rest of the world. Most of the other nations in the developed world have price controls of their own. This does ensure that they have lower prices. However, it also ensures that they have access to fewer cures, are subject to longer wait times, and often suffer from drug shortages. These are consequences that the U.S. will surely inherit if we choose to model the rest of the world.

There are plenty of solutions to help bring U.S. prices down in a market friendly way that would not upset the superior quality of care Americans receive. One would be to appoint a special trade negotiator who will convince other nations to relax their price controls so the U.S. does not have to shoulder the disproportionate burden of pharmaceutical research and development. Another would be to relax the massive burden the Food and Drug Administration (FDA) places on drug makers, making it exorbitantly expensive to do so. We could also reform the patent system that incentivizes minimal innovation and cyclical price hiking.

If we decide to go the route of the rest of the world, we will succumb to the socialist vision of European healthcare and will inherit their deficiencies. There is a definite problem in the U.S. However, despite being rebranded as a “most favored nation” proposal, is still a price control, and thus the introduction of a new problem. We need actual solutions.

US Chamber: AMERICA’S ANTITRUST LAWS MYTH vs. FACTS

America’s antitrust laws have ensured competition thrives, providing consumers with the benefits of lower prices, higher quality products and services, more choices, and greater innovation. However, some seek to rewrite these laws to undermine the consumer’s ability to pick
winners and losers in the marketplace.

Before Congress starts making unnecessary and harmful changes to existing antitrust laws, it’s important to set a few things straight.

2020 AZ Primary Early Vote Wrap-Up

What happened and what it means for November

With the primary election tomorrow, we’re giving you our takeaways from the early vote data. There are still tens of thousands of ballots to be cast on Election Day, but the ballots mailed back thus far paint an interesting picture.

Here are the high-level highlights you need to know going into Tuesday:

  • 1,063,828 Ballots Cast
  • 2,316,329 Ballots Requested
  • 45.6% Return Rate
  • 26.7% Turnout
  • 0.9% Democrat Ballot Advantage (representing 9,900 ballots) 

Interesting takeaways: 

  1. Turnout is high: We have seen more overall ballots returned than ever before in a primary election – 1,063,828. As a comparison, we saw about 835,000 ballots returned in 2018 and 682,000 in 2016. While we don’t know yet if these are people who would usually drop their ballots off, we are on pace to hit at least 30% overall turnout.
  2. Democratic turnout is exceeding Republican turnout: While we don’t know how Election Day turnout will fare, we are on pace to see something that we haven’t seen in Arizona in at least the last two decades – more Democratic ballots cast than Republican ballots. There is some hope for Republicans, though, Democrats have 1.4% more of their ballots returned. That 1.4% represents about 15,000 Republican ballots.   
  3. More Independents have cast Democratic ballots than Republican: In Arizona, Independents can choose to vote in either party primary or cast a non-partisan ballot. This year, they have cast a total of 117,845 ballots and about 8,800 more in Democratic primaries than Republican. As a comparison, in the previous two cycles Independents have cast between 10,000 and 12,000 more ballots in Republican primaries than in the Democratic primaries.

While primary turnout does not specifically correlate to general election performance, Republicans need a big Election Day performance to mitigate some of these troubling numbers. Democrats have not traditionally had a lot of primary elections – which has driven down their turnout in the last two cycles – but high turnout this year is occurring in places with and without contested primaries on the Democratic side. 
We will have at least one additional update from Maricopa and Pima counties today that can be seen here. Stay tuned for a full debrief post-election to see if these trends from mailed early ballots held or if the trends simply represented Democratic voters mailing in versus dropping off on Election Day because of COVID concerns.

*Data is current as of 8/02/20 at 6:00pm*
Looking ahead to the General Election
 As mentioned before, we decided to share our entire primary ballot tracker with the public but will be providing general election early vote tracking via paid subscription only. We apologize for any confusion we may have caused in our previous email regarding the general election subscription model. We will continue to release basic, high level numbers publicly for the general election (total ballots and party breakdown, statewide only) but for those looking for greater detail and analysis, we will be offering two subscription levels.

Level One will provide full current year breakdowns similar to what is currently shown on our primary election tracker.

Level Two will have comparison data for the previous two cycles and will add in additional filtration features.

If you have any questions or would like to subscribe for the general election tracker, you can contact Data Orbital here

ABOUT DATA ORBITAL: 

Data Orbital is a full-service data solutions and survey research firm with local, state, and national experience.  We offer precise data solutions, informed by political and policy intelligence, so our clients can chart the right course through the corporate or political landscape ahead. 

Martha McSally Releases a Volley of Political Ads

US Senator Martha McSally released a volley of political ads on YouTube Friday. Here are those ads:

How America Gets Its First Black Woman President

The real question is will she be a Republican or Democrat?

Time for a crazy political scenario. This spins off insider speculation that Trump will pull out of his re-election bid before he loses. It may sound far-fetched but we do live in crazy political times.

Trump is going to lose the 2020 election. He knows this and I believe the Republican Establishment knows it too. It’s inevitable and as many of us have been warning since 2015, the man has brought it on himself.

Trump is a quitter, especially when the going gets tough. And the tough is really going tough and tougher. Some Phoenicians remember when he pulled out of the development of a high rise in the Biltmore area. He knew when to cut his losses and move on. That’s what savvy business leaders do. He’s been that way his entire life. Bankruptcy after bankruptcy, change of plan after change of plan. He’s won some and he’s walked away. Running the country has become too much of a hassle for someone who has always sought leisure and pleasure and maybe it’s just not worth it to him anymore.

That’s just Trumps modus operandi and its how some deal-cutting New Yorker’s operate.

Right now the political heat has reached temperatures I think he’s no longer willing to tolerate.

At the same time, the GOP Establishment is worried, very worried. Arizona is likely to lose its other US Senate seat – the first time in decades Arizona may have two Democrats in the US Senate. Other Republican Senators across the country are panicking.

The “Trump Effect” we warned about flipped the House in 2018 and is about to flip many seats in the Senate. Arizona is on the verge of turning blue. We warned you.

So how do we get an African-American woman as our next President? Indulge me.

Knowing the election is going down, Trump and the Republican Establishment gather and conclude there’s only one way to possibly save the presidency – elevate Mike Pence through the resignation of Donald J. Trump. It’s all done quickly before most states issue early ballots – mid- September – leading to a real “October Surprise.”

Prior to the Trump exit, Biden picks his VP. He’s already announced it will be a woman of color and one of the names floated has been former Obama advisor and Ambassador to the United Nations, Susan Rice. It works for Biden because he already knows her well, she brings foreign policy experience to the ticket, can protect her former boss from Republican investigations and frankly, delivers on a promise.

Republicans in a free fall with Mike Pence at the top of the ticket, counter with a strategic move. They call up former Secretary of State and National Security Advisor, Condoleezza Rice. It’s one final push to hold the election and make a statement about the Republican party’s diversity.

Biden has Susan Rice, Pence has Condoleezza Rice. Coincidence?

On to Election Day and the answer of whether the first African-American woman President will be a Republican or Democrat. I don’t know.

In the first scenario, Mike Pence holds the presidency, barely. Americans were tired of all the Trump drama but were also willing to forgive Pence for his guilt by association.

Unfortunately, the US Congress doesn’t hold the same sentiment.

The Senate, now flipped, has the numbers to convict a sitting Republican President. The US House, even more democratic, impeaches Pence on the impeachable offense du jour. The vote heads to the Senate and this time, Democrats are successful in convicting the nicest man to ever become President. Vice President Condoleezza Rice becomes the first Republican African-American woman President.

The second scenario unfolds with the election of Joe Biden as the 46th President of the United States. There’s only one problem and everyone knows it. Joe Biden’s mental capacity is waning. Republican leadership in the House and Senate calls for the removal or resignation of the President. Welcome to the 2020’s where impeachment is now weaponized. The hesitation by the American people in electing Biden in the first place becomes a reality and the calls for resignation grow louder. Democrats quietly push for his exit to save the party embarrassment but mainly to elevate the first woman of color into the White House. Susan Rice becomes the first Democrat African-American woman President

The beautiful irony in all this is that the two old white guys – who many were asking, “is this the best we have?” – have now been displaced and replaced by individuals who reflect the times and turmoils of where the country appears to be headed.

Too far fetched or is political truth stranger than fiction these days?