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First of all, it's easier to be able to optimize for this; this is many more steps removed from the company, so you do the chain of causation is less certain. That makes all of the harms less speculative. It's also more dependent on exogenous outcomes that they can't control, so it's much harder to optimize. |
And it's a values distinction, right? We don't—it's trivially good that cheaper prices and better quality are better for everyone, but this is about a series of value trade-offs, which makes it incredibly difficult to optimize for. |
But even if we could optimize both equally, we would say that this is a more important standard because economic conditions are the most important thing to most people around the world living close to the poverty line. This matters to everyone, not just people who particularly care about privacy. |
It matters to consumers; it matters to firms and their growth and their workers when they can get cheaper input goods. We can probably predict it much better on our side. We have things like market modeling; we have lots of super analogous examples. |
We also get far better—oh, also know, we can, on our side, regulate out the set of things that they want to talk about. We can set a baseline; we can say you can't do these bad forms of price dumping. But you can't set a baseline for competition law because you're worried about price freezing out supply. |
You can't set a baseline for how much innovation you have to do. And the next thing to say is that consumer law actually feeds into other things because the consumer standard feeds into other things. Because when goods are cheaper, consumers can more optimize for themselves what kind of privacy they want because they can discriminate between goods far easier when the cost of doing so is less. |
Because economic development allows you to develop things that end up, in the future, contributing to those externalities. We also get less corruption on our side because they talk about democracy. I don't think it's a good idea that the government is able to make decisions about who can and cannot stay. |
I think that the government shouldn't be making that decision. I think that in the worst cases, where democracy is actually under threat, that is incredibly likely to get weaponized in order to throw down your political enemies; that is a huge harm. |
</lo> |
<dpm> |
Two questions in this speech. First, which side has—on which side is regulation more likely to be successful? And second, the side that provides the most impactful regulation on success OO makes a number of trades. |
The first thing they say is that this makes mergers and acquisitions more difficult because it relies on a more nebulous legal standard and more nebulous legal reasoning. First, I want to point out that this does not interact with the material you get from Victor that explains why M&As are likely to be harmful in the first place at best with the symmetrizes this content. I will understand why they're particularly and why these arms are incredibly precious to individuals. But secondly, I just don't think this is true, right? I think many a time the legal system is able to establish legal standards for things like harm to the environment, harm to privacy, for example. It's easy to prove because we have a broad sense of what kind of data we don't want to be in the public domain or the kinds of data that we want to be in the hands of corporates. Crucially, I will flip this because the test for increased prices, for example, is vastly more speculative because it's a game of margins. Often, it's obvious when there's a violation of privacy, but with the advent of increased scrutiny on privacy due to things like artificial intelligence, like abortion legislation, and so on, this is likely going to improve over time. With prices |
What's different is that it is difficult for you to prove that the margin by which you reduce or increase prices is a margin that is likely to be consequential. Is a $1 increase enough? Is a $2 increase enough that sort of thing? They then say that a reduction in M&As is harmful in two ways. First, because on their side, in the absence of M&As companies, operate on a larger scale. I think this is harmful because already the companies that are able to engage in acquisitions in the first place are profoundly powerful customers. They have incredible influence over political systems; they make the economy incredibly dependent on them. Imagine the nature of companies that are engaging in these M&As. What happens if they consolidate? It supercharges the harm if you get our picture. |
They then say that these companies become less vulnerable to shocks. I only think this is true for horizontal mergers, that is, cross-industry mergers. But I think in the majority of cases of this debate this likely deals with vertical mergers because this is where harm to antitrust is almost consequential. If you own the entire production line, it's an incredible stretch to antitrust standards and antitrust explanation. Lastly, I want to note that often the standard necessary to prove a harm under the consumer welfare standard is often very difficult to acquire at the point at which this regulation is happening. There are two reasons for this. First, businesses are often able to do things like price couch, particularly at the moment of the merger or the acquisition. They keep their prices very low at the beginning of their ownership and then influence the market. Then they drive these prices up. This means often you're not able to prove an immediate harm in court because the harms associated with monopolies are often harms that emerge over time. |
This is important because this debate likely happens in Western countries that rely on a posterior legal system where it's impossible to preemptively litigate, or rather very difficult to preemptively litigate because courts are very focused on proving a degree of harm to consumers that they will never be able to prove. Secondly, though, businesses in court are often unable to make claims with respect to economies of scale that make it easier for them to claim that they will actually have the financial power to be able to do things like lower prices or increase quality and so on. The weighing of this is as follows: both sides must come to the agreement that the success of regulation is important. Companies will have extraordinary levels of power and influence in the places where this debate is likely to exist. There's an incentive to cap this power and influence as far as possible. |
We think we do that best before The second question on impact for regulation; Cases |
<poi> |
Just to clarify: do you agree that there will be a substantial increase in blocking of mergers and acquisitions on your side? |
</poi> |
We think there will be a reasonable number of mergers and acquisitions on both sides. We think this debate should be premised on the fact that a finite number of mergers have been flagged. This is simply a question of, on both sides, we're litigating for the same mid-day, which is more likely to yield impactful regulation. Our side tells you that we make companies preemptively regulate in such a way that they're unlikely to do in the world of opposition. |
Opposition says that economics are often the most important thing to consumers, but I want to be perfectly clear on a number of levels here. First, often consumers within the market are able to regulate for things that affect their economic conditions most directly. Consumers can see for themselves when prices have gone up. Consumers can see for themselves when quality has gone down. This is different for harms to democracy or harms to the environment because these are harms that often happen over a protracted period of time. Democratic backfighting doesn't happen overnight; it happens over a long period of time. These are harms that are very difficult for the immediate consumer to see for themselves. |
This is precisely why we think the FTC and the DOJ need to be the ones to creatively point out these harms and try to prevent them. But secondly, I think there's a logical priority here because obviously economic conditions, the media, and consumers are reliant on things like the existence of a functional democracy. In the absence of democracy, you don't get the kinds of investment that you think are necessary to bring jobs and create employment for individuals. In the absence of a clean and healthy environment, you don't have, for example, a labor force that's equipped to go out into the workforce. You don't have, for example, the land that's necessary for the vast majority of economic activity in many parts of the world. |
I want to weigh this in two ways. One, the places where this debate likely exists are places where harms to non-economic outcomes are under new scrutiny in a number of ways. In cases like the US and the EU, where right populists have gained power, where climate justice movements are on the rise, and where privacy issues due to things like the wars for the right to abortion and the regulation of AI connect these struggles in such a way as to raise political capital with this regulation. I think raising this capital is important because the comparative big companies are often able to market themselves as doing incredible things for the market. |
Before AT&T and T-Mobile attempted to engage the merger in 2011, they flooded the market with advertisements about how much the cost of accessing, for example, the internet would go down and how incredible this would be for the immediate consumer. Often, we think it is necessary for you to be able to connect pre-existing movements for regulation in such a way as to raise political capital for the regulation of these M&As and for these businesses and their activities. But secondly, the harms associated with privacy, with democracy, and the environment often disproportionately affect vulnerable groups. Environmental harms, for example, ruin the lives of individuals on the ground. Indigenous people, for example, are disproportionately affected. In the world in which you harm the environment, harms to privacy disproportionately affect women, who in many instances have very limited access to their rights in the first place. They are likely to be disastrously affected, having their lives ruined by violations of this right. |
Harm to democracy is often dangerous to the middle class because you take away the political capital that they often use as a check against the economic capital of the ruling class. This means most importantly that we think these kinds of harms should be prioritized because they are the most approximate to the median consumer. This has two consequences: what it means is that these are the kinds of harms that lead to consumers actually raising political capital for these mergers and for these acquisitions. But secondly, we fulfill an obligation to prioritize the most vulnerable individuals in a way that you would never be able to do on their side, in a way that makes us so incredibly proud to propose. |
</dpm> |
<dlo> |
I talk generally about the biggest question. This, and I'll get into the specific claims made by the opposition. The most obvious question you need to ask in this is is trading of business growth, all these goals, environmental, privacy, and democratic protections actually work. This is central to whether you should empower these organizations against democracy through the will of judges deciding to do so. I only make two notes of back. Firstly, there's little to no proof from the opposition of how mergers and acquisitions actually result in these harms. They give a very, very small number of even examples of how this would occur. |
That should suggest to you that at best, I think this happens to a very small extent. Even if closing government let go off that significantly. Secondly there's also no proof of why causing these harms necessarily comes from a lack of competition. This is to say that a tech firm buying a data company can significantly harm the privacy of its users and of consumers in general, whilst being in a very competitive market. And that's important because it dramatically expands the scope of these regulatory bodies to consider often what is only mildly anticompetitive behavior to be something that is worth being shut down. So they're now acting beyond the scope of what they were previously tasked with. |
For the rest of this, I would now pretend as if they had proved both of those things to be true. And later, why is it not worth trading up business growth for these goals? Firstly, as we explained, these harms, not universally, are great harms in the first place. All people believe that harms to the environment are actually harmful. The idea that animals and trees actually matter as beings is something that I believe, but a lot of people may not. Maybe that's bad, but that's true of a lot of people. And even things like high costs, for example, a lot of people want companies to collect more data so that they can offer better services. Comparatively, higher costs are every election year a huge concern for consumers that everyone doesn't want because it objectively makes your life more expensive and more difficult. |
Secondly, even when they are agreed to be harmful, the trade-off is much more ambiguous than with consumer issues. Environmentalism, for example, is often a controversial issue. It's something that affects a small group of people, the people who live in that area that is being polluted at the benefit of everyone else who is able to access the resources. Whereas consumer protections affect everyone. Everyone who purchases that good bears that cost, and everyone in society bears the cost of less innovation and the decreased functionality of the products that are available. |
And thirdly, business growth is just very, very important. It gives people access to jobs and prevents businesses from going under. Often, the reason why acquisition or mergers occur is because those two businesses couldn't independently operate without this. It creates more efficiency, which again leads to more jobs. It helps the economy grow. It is substantially better than other alternatives. It's also more durable because it makes companies larger and therefore more resilient economically. So business growth should be valued as something that is important to people's lives as a moral concern, just like the moral concerns of environmentalism are important. |
The final thing that I want to prove here is that I am on the side of being overly valuing these kinds of protections, like protections of the environment and democracy over business concerns. Why is that true? Firstly, it's because they're appointed by politicians. Some politicians care a lot about business concerns, but others care a lot about the environment and about privacy and about those issues. For example, many left-wing governments value those things as being above and far more important than other things. Socialist governments, for example, value those things at the entire expense often of economic growth. These people will select deliberately judges that are most likely to be pro-environment when they engage in decision-making, which is popular around the world. |
Secondly, those judges are often unaccountable. They kind of cannot be removed because of the separation between the legislature and the courts, which means that when they make bad decisions or have a proven track record overly leaning towards environmentalism, it can be very difficult to review. That level of judicial activism is common around the world. For example, in Europe, there is extremely judicial activity, as well as in South America. This is a very common problem, but they think only about the law and whether it meets specific criteria in that proven level of harm. |
The environment, like I should believe, is this trade-off worth it in theory or in practice? But secondly, and arguably more importantly than that, this is clearly something better handled by governments and by democracy. If the trade-off is ambiguous and it's unclear whether it's worth it, you put it in the hands of people that are accountable to the public rather than unelected judges who do not have a mandate to do so. |
Let me just respond specifically to the claims made by this team. Their first claim is that this will lead to more data being released on the level of environmental concerns. They actively release that data. Firstly, there's no reason to believe they would freely release that data; they might store that data so they can later use it in court. It's unclear why they would make that data public unless mandated to do so. Secondly, equally, they might hide that data because if they have to prove that they were going to cause some harm to the environment or some harm to privacy, they can also just never show that data. So that if they were in court, you wouldn't be able to prove the merger decision is going to lead to that harm. |
Thirdly, collecting that data is a big expense. It slows down business because you have to do a lot more record-keeping and keeping track of that data, which means you do actually face a trade-off here, which in many cases isn't worth it. You don't need to do that because the merger or acquisition was fine in the first place. And finally, we think there are better ways to regulate this in the context of if you believe it is absolutely necessary. |
Next, this will lead to more political will to be controlled and pledged. This isn't the easiest flip in the world. Firstly, because these are much more ambiguous. Now, DPM explicitly says that issues like harms to the environment or harms to privacy or harms to democracy occur over very long periods of time and are things that consumers are unable to detect. Therefore, they must be in the hands of the FCC or other organizations. That is a concession that now the government also has to stand by. If you believe that's true, you must believe that consumers are unaware of why regulators are making these decisions, or at the very least, they are more skeptical of them. |
This means they see regulators blocking things that would create jobs, maintain business stability, and support growth at the expense of something they have not realized yet. Comparatively, other things are much more politically valuable, which is why those sensible levels of regulation get more support on our side. |
But secondly, it's more politically unvaluable specifically to the right. These are obviously things that hug towards left issues, like privacy, democracy, and environmentalism. These are left issues, whereas specifically right-wing parties oppose them. The impact of this is probably that it's less popular in general to fund regulators, and specifically popular right parties to remove their money. That's important because when they have less funding, Yes |
<poi> |
Your case seems internally inconsistent. So that's majority of people care primarily about economics and politicians probably appoint people who don't go crazy far left woke and only |
care about environmental issues by your own characterization... |
</poi> |
Well the problem with that is there are different people in the world right some people prefer issues. others don't. we have left wing parties, right wing parties. our intention is left wing parties are in power, which obviously happens a lot around the world. they appoint police judges that cause a series of harms and if you believe that a right wing politician pointing right wing judges you should believe those judges will basically never implement your policy if they don't support that level. So, I don't think that really works. The impact here is when regulators are less funded they both do their job less they do less regulation to do it worse which is that they select worse forms of regulation. |
The final thing I want to point out is the large amount of corruption that will likely occur as a result of this. This occurs at the individual level, where the regulators are captured by the government because it becomes substantially more in their interest to do political goals as well as those smaller financial goals. But also at the government level, where you get certain firms wanting to influence politicians so the appointments will be biased in certain directions. This is bad for competition; it's extremely corrupt, and it decreases people's trust in the government. So, extremely harmful. Vey proud to oppose. |
</dlo> |
<mo> |
The main problem with the top half is the problem of characterizing the types of cases where the consumer welfare standard differs from the citizen welfare standard. The answer from closing government is relatively straightforward. The clearest example where this debate meaningfully differs is the example of large tech corporations like Google, Microsoft, AI, etc. Why is this where the debate realistically occurs? Three reasons. First, large tech companies are naturally highly consolidated due to network effects. For example, there is often a consolidation of large numbers of people onto a small number of social media platforms, which means that these industries are often large. But more importantly, the reason the consumer welfare standard cannot apply to these platforms, even though they are particularly large and consolidated, is because the vast majority of services provided by large tech companies are either free to use or very low cost. For example, no one has to pay money to Google Search; no one has to pay money to use OpenAI for service. The consequence is that the consumer welfare standard is completely unable to address consolidation in large tech companies. |
The other reason the consumer welfare standard does not work in the context of large tech corporations is because the perception, especially amongst the non-tech world, is that large tech companies are enormously innovative and job-creating. Most people think of Google, Microsoft, or Amazon as highly innovative, which means it's very difficult for a judge to argue we should break up Google or spin off OpenAI from Microsoft because the perception is that there is not a lack of innovation in the status quo. |
I want to be very clear about why this framing is important. Opening opposition runs a very scary doomsday case about what happens when judges start blocking mergers left, right, and center. But no, that's not what's going to happen under this debate. Why? Because on both sides of the house, you will only block mergers and acquisitions in cases where the increased competition would pose a meaningful threat to the environment, to security, to data, etc. The problem is that most other industries are not highly concentrated, which means that the merger between two relatively small automobile manufacturing companies has a relatively limited effect on the environment or a relatively limited effect on privacy. |
Whereas the much more important part of the debate is the context of tech companies, which is why, for example, Lina Khan—it's not Lisa Khan, by the way—is so in favor of our policy because she wants increased capacity to go after large tech companies. |
The other reason this is important is it answers opening opposition's challenge: "Oh, a fair claim. Why can't we just regulate these companies? Why do we need antitrust?" This is the burden closing opposition will fill that puts us over opening government. You cannot regulate big tech companies for three reasons. Reason number one: governments are structurally unable to regulate tech. This is because the vast majority of politicians are old; they're boomers. They often don't understand how tech companies work. Like, have you all seen that hearing where they literally asked Facebook what the hell an algorithm was or what a phone looks like? The problem is, given that you need power, money, and connections to be in politics, the people tasked with regulating big tech are often incompetent. |
Secondly, the pace of advancement in AI is far faster than the pace of advancement in legislators. No government can keep up with this. This is a one-liner PM, but here's the real reason why the legislative process is slow: it involves horse trading. You have lots of discussions between lots of different parties. By contrast, tech advancement happens rapidly because it's naturally self-fulfilling. When one company, for example, develops a better AI algorithm, another company incorporates the algorithm into its products and advances its own rate of advancement. This means you can never legislate as fast as the tech sector advances. |
Reason number three: governments do not regulate tech because of fears of regulatory arbitrage. The reason the United States will never strictly regulate AI is fear that if you tightly regulate AI, AI companies will flow elsewhere, for example, into less regulated districts. This answers the problem that opening government does not solve. Why is antitrust specifically necessary? It's because regulation is insufficient. |
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