Unlikely Senate Alliance of Klobuchar, Lee Paints a Bull’s-Eye on Big Tech
Unlikely Senate Alliance of Klobuchar, Lee Paints a Bull’s-Eye on Big Tech
(Bloomberg) -- By the standards of today’s polarized Washington, Senators Amy Klobuchar and Mike Lee shouldn’t be friends.
She’s a pro-choice, moderate Democrat who supported a bigger role for government when she ran for president last year. He’s Mormon and a small-government, conservative Republican whose father served in Ronald Reagan’s administration. They operate in an atmosphere of deep mistrust between parties, made worse by the Jan. 6 assault on the U.S. Capitol.
Despite their differences, they’ve forged a close alliance out of a mutual concern: that mega-corporations, especially giant tech companies, have too much power. That may bode ill for Apple Inc., Alphabet Inc., Facebook Inc. and Amazon.com Inc. as Klobuchar and Lee, the chairwoman and ranking minority member of the Senate Judiciary antitrust subcommittee, focus on revamping century-old antitrust statutes.
Klobuchar, 60, and Lee, 49, have shared the top spots on the subcommittee for eight years, and their rapport shows in the hearings they plan together, the joint meetings they take with lobbyists and their negotiations over how to overhaul antitrust policy.
When Apple tried to dodge a Senate hearing on app stores last month, the iPhone maker found out how determined the senators, both former prosecutors, are. Speaking by cellphone as Klobuchar flew home to Minnesota and Lee headed back to Utah, they composed a letter to Apple Chief Executive Officer Tim Cook, demanding he send a witness to explain a business model that “raises serious competition issues.”
It worked. Apple’s chief compliance officer appeared virtually before the subcommittee 12 days later. He fielded tough questions from both senators, who laughed at each other’s jokes, conferred with each other’s staff and reinforced each other’s points.
Regulating big companies traditionally has been the purview of Democrats like Klobuchar, whose new book, “Antitrust: Taking on Monopoly Power from the Gilded Age to the Digital Age,” covers the rise and fall of trust-busting over the last two centuries. But Republicans like Lee, whom she thanks in the book’s acknowledgments, are also increasingly critical of dominant firms. While most GOP anger has been focused on the tech giants, the changes Klobuchar and Lee are discussing could have implications for many other industries, including pharmaceuticals, agriculture and airlines.
“We do find common ground on questions of policy, working out deals and contingencies we want to have,” said Klobuchar. “We get along quite well.”
When Senators Lee and Klobuchar are in sync, “they’re a formidable bipartisan duo,” said Lee spokesman Lee Lonsberry.
Their collaboration comes as antitrust experts, other lawmakers and members of President Joe Biden’s administration are showing heightened concern about concentration across the economy.
“This is a once-in-a generation thing,” said Bill Baer, a former head of the Justice Department’s antitrust division during President Barack Obama’s second term. “I don’t think we’ve ever seen this collective concern in the body politic about increased concentration, increased power in the private sector.”
House Counterparts
Klobuchar and Lee’s working relationship is mirrored on the House side, where Democratic Representative David Cicilline heads that chamber’s antitrust subcommittee and works closely with the panel’s lead Republican, Colorado’s Ken Buck.
They, too, are unlikely allies. Cicilline, 59, was the first openly gay mayor of Providence, Rhode Island, whose attorney father defended mob bosses. As one of the House’s most progressive Democrats, he champions gun control and LGBTQ rights and served as one of the prosecutors in President Donald Trump’s second impeachment trial.
Buck, 62, is a gun-toting social conservative and close Trump ally who wrote a book called “Drain the Swamp: How Washington Corruption is Worse than You Think,” using a slogan borrowed from the former president’s first campaign. After serving as a Justice Department prosecutor, he ran for Congress on a pledge to rein in government spending.
Through spokespeople, Cicilline and Buck declined to comment.
An investigation last year resulted in a 450-page report by the panel’s Democratic staff, calling for a radical overhaul of antitrust laws and enforcement. In his response, Buck warned against over-regulation, but agreed with recommendations to better fund enforcement agencies, require companies to give consumers more control over their data and make it easier for regulators to block mergers.
Cicilline plans to soon introduce a series of narrow antitrust and tech-related bills -- a strategy designed to capture the support of Buck and other Republicans on some measures, even if there are other areas of dissent. Passing legislation in the House requires only a simple majority, which would be even easier if Buck is on board and can bring along some of his Republican colleagues.
That means Klobuchar and Lee are the ones to watch. She will need the support of every senator in the Democratic caucus plus at least 10 Republicans if she is to steer antitrust legislation around the Senate’s filibuster rule and to Biden’s desk.
The Minnesota senator has introduced a sweeping antitrust proposal, which she said she’d be willing to break into smaller pieces that are more likely to get bipartisan support. Lee plans to offer his own bill, parts of which will overlap with Klobuchar’s, according to a Republican aide.
‘On a Crusade’
Klobuchar’s obsession with protecting market competition began in 2008 when a constituent alerted her to a twenty-fold increase in the cost of a life-saving drug for premature babies with a heart condition, according to her book. She recounts her frustration with years of conservative court precedents that make it almost impossible for the Justice Department and Federal Trade Commission to win monopoly cases. “I’m on a crusade to fix this,” Klobuchar writes.
She makes the case for trust-busting as a return to the nation’s founding principles, describing the Declaration of Independence as “an act of economic rebellion against monopoly power.”
Using antitrust laws to defend economic freedom and capitalism is attractive to Lee, whose commitment to the Constitution and small government began as a child. He used to accompany his father, Rex Lee, President Reagan’s solicitor general, when he argued cases at the Supreme Court.
But it’s not clear how much change the GOP senator wants. He has said he’s committed to the legal measuring stick known as the consumer welfare standard for deciding whether companies should be allowed to merge. That generally involves determining if a combination is likely to result in higher prices. Many Democrats, like Klobuchar, would expand the criteria regulators should consider but also shift the burden of proof in some mergers from the government to the companies, which would have to prove their proposed combination isn’t anticompetitive.
Yet Lee has agreed that consumer welfare involves more than prices. Speaking during last month’s confirmation hearing for Lina Khan, a Columbia law professor who has been a critic of large tech companies and was nominated by Biden to be an FTC commissioner, Lee said consumers are also affected by product quality and diminished choice. He even advocated for more aggressive antitrust enforcement.
“It seems to me that our laws could meet the need if only enforcers brought the appropriate facts and the appropriate evidence and the appropriate cases to the table,” Lee said.
One GOP Senator, Missouri’s Josh Hawley, has been pushing for more radical changes to antitrust law, channeling Trump’s brand of angry populism. But Hawley, who was cheered by rioters on Jan. 6 as one of the first GOP senators to challenge the results of last year’s presidential election, hasn’t attracted any co-sponsors.
Bringing lawmakers from both parties on board for broader antitrust changes could depend on how well Klobuchar can leverage her friendship with Lee.
“I’ve got to find the support where I can find it,” Klobuchar said during a May 5 virtual book event. “The truth will be told how serious they are about taking on monopolies if they’re willing to look for common ground on these bills, and there are signals that some of them will.”
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