The European Union is on a crusade against American technology companies. Through a litany of aggressive new laws, the E.U. has declared war on Silicon Valley which, in Brussels’ view, currently enjoys a blank check to run riot over consumer rights and protections in Europe. The E.U. appears more concerned with banning new technologies and eradicating U.S. firms’ presence in Europe than fostering innovation and competition. Recently, the E.U. has recruited a show-stopping new ally to its fight against American companies—the U.S. government.
It was little surprise, when the E.U. unveiled its latest salvo against the U.S. tech scene: twin bills called the Digital Markets Act (D.M.A.) and Digital Services Act (D.S.A.). They include clunky regulations like age verification mandates which are likely to worsen privacy, do nothing to protect children from adult content, and balloon costs for American businesses. Research suggests the two Acts could, between them, cost companies a whopping $50 billion in compliance alone, such is the administrative and regulatory burden the E.U. is lumping on American enterprises.
Why would the U.S. government ever get behind such a transparently anti-market and anti-American regime? Enter Lina Khan, chairwoman of the Federal Trade Commission (FTC). She, too, buys into the narrative of untethered forces in the tech industry which regulators can heroically rein in.
Khan’s activist leadership of the FTC, which includes blocking deals between tech companies, pursues cases where threats to competition are far from obvious and require substantial assumptions about the future. Take the case of Illumina, a healthcare tech company, where the FTC’s own administrative judge determined the FTC had failed to prove an Illumnia acquisition would harm competition. Khan maintained the deal could harm competition at an unspecified point in the future, overruled her own judge, and blocked the deal.
Khan appears to be a great admirer of the E.U.’s work in expanding its legal framework for antitrust, so much so that she has gone out of her way to arrange meetings with the lawmakers behind the E.U. bills and signal to the world that she admires their approach. Along with Jonathan Kanter, assistant attorney general in the Department of Justice (DOJ) antitrust division, Khan was pictured smiling alongside European Commission executive vice president Margrethe Vestager, the architect of the E.U.’s antitrust policy, following a recent meeting.
Vestager, a former Danish deputy prime minister, spoke in glowing terms about the E.U.’s “close and fruitful cooperation” with the DOJ at a conference following the meeting, which was the third of its kind. She waxed lyrical about how she and President Biden’s appointees share a common approach to antitrust issues, centered on an engorged role for the state. This recent coziness follows a 2021 announcement of a ‘joint technology competition policy dialogue’ to facilitate U.S.-E.U. collaboration.
You might reasonably expect the U.S. government to stand up for American businesses in the face of an unwarranted attack from a powerful foreign regulator, seeking to preserve and expand opportunities for American companies to do business overseas. Instead, the DOJ and FTC seem determined to restrict those opportunities by lending their support to the attackers.
It is in the interests of the American government, consumers, and enterprises for large overseas markets like the E.U. to be receptive to U.S. services. It’s no different to American car factories or oil producers exporting their goods abroad. It gets money flowing into America, it cements America’s position at the helm of the free world’s economy, and it helps the American free market bloom.
The E.U.’s aggressive approach to tech regulation will no doubt harm European consumers. That’s Brussels’ prerogative. But for U.S. regulators to voluntarily muck in with an effort to wring a key American growth industry by its neck is baffling. The DOJ and FTC ought to have at their heart the interests of American companies and taxpayers, not European consumers – much less the bizarre, niche, and radical fixations of a cabal of unelected bureaucrats in Brussels.
The trend of the DOJ and FTC more closely integrating U.S. antitrust policy with the E.U., even when the European approach directly harms American interests, is profoundly worrying. Through Brexit, the U.K. (where I’m writing from) escaped the harm of unaccountable top-down regulation from the E.U.’s lawmakers. Does the Biden administration want the U.S. to take Britain’s place, taking orders from Brussels?
