Advertisement

Ambitious breakup of Amazon, Facebook and Google is proposed by Elizabeth Warren

Ambitious breakup of Amazon, Facebook and Google is proposed by Elizabeth Warren
Massachusetts Sen. Elizabeth Warren, a Democratic presidential candidate, speaks at a March 1 campaign rally in Dubuque, Iowa. She unveiled her plan to break up tech giants Friday. (Scott Olson / Getty Images)

Sen. Elizabeth Warren (D-Mass.) pledged Friday to take aim at Amazon, Facebook and Google if she is elected president in 2020, breaking apart each of the big tech companies and introducing sweeping new regulation of Silicon Valley.

The proposal marks the most ambitious and aggressive effort targeting the tech industry offered by any Democratic contender for the White House, and it could put pressure on other presidential aspirants to offer similar plans for more aggressive tech oversight.

Advertisement

“To restore the balance of power in our democracy, to promote competition, and to ensure that the next generation of technology innovation is as vibrant as the last, it’s time to break up our biggest tech companies,” Warren said.

Warren’s proposal has two key elements. First, the Democratic lawmaker said her administration would appoint “regulators committed to reversing illegal and anti-competitive tech mergers,” including Amazon’s purchase of Whole Foods, Facebook’s tie-up with WhatsApp and Instagram, and Google’s ownership of Waze, Nest and DoubleClick.

Second, Warren said she would push legislation that would label key services — such as Amazon’s marketplace for goods and Google search — as “platform utilities,” which would have to be spun off from those tech giants’ other businesses.

Her plan primarily targets companies with annual revenue over $90 million, and it would embolden federal and state regulators to issue steep fines and other penalties for practices that harm competition or consumers. Even Web users could sue Amazon, Facebook and Google if they violated Warren’s proposed federal rules.

Warren’s blueprint — detailed in a Medium post — was unveiled as she prepared to speak to supporters in New York’s Long Island City neighborhood, where Amazon initially sought to construct one of two new headquarters. The company ultimately withdrew from the city amid staunch local opposition and fierce criticism from national figures such as Warren, who felt Amazon had received “taxpayer bribes” from New York.

“We must ensure that today’s tech giants do not crowd out potential competitors, smother the next generation of great tech companies, and wield so much power that they can undermine our democracy,” Warren said in the Medium post.

Amazon, Facebook and Google did not immediately respond to requests for comment.

For now, Warren’s plan illustrates the tech industry’s political fall from grace, as policymakers around the world begin to confront the ills posed by Silicon Valley — from the job losses threatened by the rise of automation to the fast spread of falsehoods online. Privacy scandals, fears of election interference and rapid consolidation have soured even the industry’s historically close ties with Democrats in Washington in recent years.

Previously, Democratic presidential candidates jockeyed to be seen as digitally savvy in the hopes of courting young voters and raising critical cash from tech moguls’ deep pockets. Then-candidate Barack Obama even appeared at Google headquarters during the early days of his 2008 campaign.

More than a decade later, though, the party’s most prominent national figures have become some of Silicon Valley’s fiercest critics, responding to mounting concerns about the effects of major internet platforms on the economy and even democracy itself.

Sen. Amy Klobuchar (D-Minn.), another 2020 presidential hopeful, broadly has decried the “major monopoly problem” in the United States — particularly with big tech. Sen. Bernie Sanders (I-Vt.), meanwhile, has tangled with Amazon over its business practices, particularly its treatment of workers. While neither they nor any other presidential contenders have issued a plan as aggressive as Warren’s, tech experts in Washington said the party in general had set its sights on reining in the tech industry.

"I don't believe this will be an out-of-the-mainstream proposal in 2020,” said Rob Atkinson, president of the Information Technology and Innovation Foundation, a think tank where representatives from Apple, Microsoft, Google and other tech companies sit on the board of directors.

Calling Warren’s proposal “appalling,” he said of the tech industry’s relationship with Democrats: “Not only is the honeymoon over, but they’re in divorce court.”

Advertisement
Advertisement