One of the defining issues for incoming President Joe Biden is how he will treat Big Tech. Public sentiment towards the tech giants, which rank among the wealthiest and most powerful corporations in the world, has shifted significantly since fellow-Democrat Barack Obama’s tech-friendly presidency. Now, calls for government action to contain their influence resound – but will Biden heed them?
The appointments that Biden has announced so far include several former Big Tech executives who are unlikely to support calls to break up the industry or other radical interventions. At the same time, the political consensus has shifted to such an extent that a return to Obama-era ties between the White House and Big Tech is unthinkable.
Joe Biden’s Big Tech appointments
It is hard to tell what Biden thinks about Big Tech himself: he has not taken a strong, public stance on most of the blockbuster issues involving the tech giants. The three biggest are competition (will he support anti-competitive action against the tech giants or even breaking them up?), regulation (will he support increased legislation governing how tech companies operate?), and taxation (will he support the OECD’s call for a globalised tax that would hit major American technology companies hardest?).
We do know that the tech industry was among the biggest backers of his presidential campaign. Employees at Alphabet, Amazon, Apple, Facebook, Microsoft and Oracle contributed $4.78m to the Biden campaign leading up to October 2020, according to an investigation by Wired. Google-parent Alphabet’s employees and political action committee outspent the others. An analysis by Vox found that 15 Silicon Valley donors collectively gifted a total of $120m to the cause of destroying Trump over the past two years.
And based on the political appointments he has announced so far, Big Tech’s perspective will be well represented in the White House.
Despite growing regulatory scrutiny of Amazon, Biden has so far appointed two Amazon executives to his administration. Mark Schwartz, an IT leader who served in Obama’s administration before joining Amazon Web Services in a strategy role, will join the Office of Management and Budget as an ‘enterprise strategist’. Tom Sullivan, formerly an executive on Amazon’s public policy team, is set to join Biden’s review team overseeing the Department of State.
Out of all the tech giants, Facebook arguably attracted the most political flak during the Trump presidency. Some have baulked, therefore, at the appointment of Jessica Hertz, formerly Facebook’s associate general counsel, as Biden’s staff secretary, an influential role that involves deciding which paperwork the president sees, among other things.
There has been widespread speculation over whether former Google chairperson Eric Schmidt might join the incoming administration. It was initially rumoured that Schmidt was to head up a technology task force, but this was rapidly quashed. However, Nicole Wong, a former deputy chief technology officer under Obama and a vice-president and deputy general counsel for Google, was appointed to Biden’s review team for the National Security Council and the Office of Science and Technology Policy.
Return of the old guard
Many of Biden’s appointments are of former advisers and allies that left politics to join the tech industry during the Trump years. For example, Cynthia Hogan, a top adviser to the Biden campaign, used to head up Apple’s lobbying operation, but also worked under Biden twice in the period since 1991. This is also true for Hertz, his staff secretary, who served as deputy counsel to Biden when he was vice-president.
They most certainly are not going to want to take any action that would jeopardise their future employment prospects.
Max Moran, researcher, Revolving Door Project
“What we’ve seen so far from Biden’s appointees has been largely a return of the old guard,” says Max Moran, a researcher at the Revolving Door Project. But he says the fact they left for Silicon Valley in the meantime complicates matters. “In some cases they became lobbyists, in other cases [they] took jobs that are not technically lobbying but their value-add to these companies was essentially their political connections and political influence.”
Nevertheless, Moran argues that their connection to Big Tech means it is unlikely they will support strong action against the tech industry. “I think you can assume they are not going to want to crack down on Big Tech,” he says. While they might not explicitly act in favour of the tech giants, “they most certainly are not going to want to take any action that would jeopardise their future employment prospects once they leave government again, and want to go back into the private sector”.
In addition to the four tech giants, Biden has also nominated people from Airbnb, Uber, Lyft and LinkedIn to his agency review teams. And more appointments from the industry may be forthcoming: Reuters reported late in December that Amazon, Google, Facebook and Microsoft pushed to place candidates in senior roles in the new administration, although Amazon and Google have denied the allegations. An Amazon spokesperson dismissed them as “completely false”.
Beyond those who have directly worked for Big Tech, other appointees are understood to have connections with the industry. For example, Biden’s pick for secretary of state, Antony Blinken, has ties with both Amazon and Google according to Reuters. Blinken helped Amazon’s public policy and communications chief Jay Carney land a spot in Biden’s media team in 2008, and Google was one of the clients of WestExec Advisors, a consulting firm Blinken founded.
Big Tech’s influence in the White House
There are other ways in which Big Tech might influence the Biden Administration beyond his appointments. One of these is the Innovation Policy Committee, a 700-person strong volunteer group that advised Biden’s campaign. It included at least eight people who work for Facebook, Amazon, Google and Apple, according to the New York Times, as well as lawyers who have worked for the companies and employees at think tanks they fund. Anant Raut, Facebook’s director of global competition policy, and Matt Perault, Facebook’s former director of public policy who now works in academia, were both members of the committee.
While former Google CEO Schmidt has not been appointed by the administration, he has taken advisory roles at the Department of Defense. It has been reported that the Biden administration has taken advice from Rebellion Defense, Schmidt’s military tech start-up. Vox writes that even if Schmidt is not offered an official role, he is expected to “at least have considerable access to the Biden White House”.
Many have also noted Facebook’s ties to incoming Vice-President Kamala Harris. For previous campaigns, Harris has raised funds from Facebook-linked billionaires, and she participated in a marketing campaign for Facebook COO Sheryl Sandberg’s book Lean In. As California’s attorney general, the highest-ranking law enforcement official overseeing Facebook, Harris took a permissive view of the company absorbing competitors such as Instagram and Whatsapp.
Other Facebook figures have been given advisory roles by Biden. Austin Lin, a former programme manager at Facebook, has taken a position on an agency review team for the Executive Office of the President. A former board member, Erskine Bowles is advising the transition team, while another, Jeff Zients, has been selected to lead Biden’s Covid-19 response team.
Eyes on the DOJ and the FTC
Two of the most important agencies for determining what the Biden administration’s approach to Big Tech will be are the Department of Justice (DOJ) and the Federal Trade Commission (FTC). The heads of both of these bodies will be instrumental in pursuing investigations against Google, Facebook, Amazon and Apple and their appointments are eagerly anticipated.
Terrell McSweeny, a long-time Biden aide and adviser, and FTC commissioner between 2014 and 2018, is one of the names in the mix. “She has drawn plenty of criticism for waving through a lot mergers from folks like Facebook and Google, while simultaneously, in some cases, using antitrust concerns and FTC consumer protection concerns to crack down on things like Uber driver organising,” says Moran. However, he notes that there are signs McSweeny and others are shifting their stance, in line with evolving attitudes towards Big Tech.
More troubling for progressives, is the news that Biden is considering two attorneys with extensive experience advising monopoly platforms to head up the antitrust division at the DOJ. The frontrunner, Renata Hesse, worked as a Justice Department official under President Barack Obama, but has also taken private sector roles advising Google and Amazon. She instructed Amazon on its $13 billion acquisition of Whole Foods, for example. Her work with Google would potentially pose a conflict of interest in the DOJ’s antitrust case against the firm were she to get the role, sources told Reuters.
The other name in the mix, reportedly more likely to appointed deputy assistant attorney general in the antitrust division, is Juan Arteaga, who also worked in the Obama Justice Department. He also has experience of working on monopoly cases, having represented AT&T in its merger with Time Warner. Reuters reports that other Big Tech critics are still under consideration, such as Jonathan Kanter, who runs his own law firm, but Hesse and Arteaga are leading the pack.
Aside from the FTC and DOJ, there is a less well-known body called the Office of Information and Regulatory Affairs (OIRA) to watch out for. “It’s the most powerful part of the federal government no one’s ever heard of,” says Moran. The body reviews almost all regulation put forward by any part of the federal government, carrying out a cost-benefit analysis. If it decides the costs outweigh the benefit, it can veto legislation, and the agency has to go back to the drawing board.
“In effect, OIRA becomes this massive bottleneck for any sort of regulatory action that is going to be a pro-public, pro-consumer, pro-worker, and so on,” says Moran. OIRA can essentially act as a kill switch on any threatening legislation. “[Big Tech] and most of the rest of corporate America are going to be trying to get someone who sees things from their particular perspective to run OIRA,” says Moran.
As well as a number of tech industry veterans, Biden has also hired a number of Big Tech sceptics. Tech critics such as Gene Kimmelman, senior adviser with Washington-based Public Knowledge, was appointed to the review team for the Department of Justice, and Sarah Miller from the American Economic Liberties Project was selected for a group assessing decisions about the Department of Treasury. Both are advocates of stronger antitrust action against tech giants.
Bill Baer, an ex-director of the FTC’s Bureau of Competition and former head of the Justice Department’s Antitrust Division is on a team reviewing the Federal Trade Commission. Baer has advocated tougher antitrust law. And Jim Steyer, the head of Common Sense Media and a high-profile critic of Big Tech, said he has proposed staff appointments to Biden, including senior advisor Bruce Reed.
No return to the Obama era
Obama was renowned for his tech-friendly stance. A joint project with the Campaign for Accountability and the Intercept illustrated the intimate ties between Obama’s admin and Big Tech – especially Google. Google representatives attended White House meetings more than once a week on average, throughout Obama’s presidency. Nearly 250 people traversed the revolving door between government and Google over the course of his administration.
It’s hard to ascertain how exactly this affected the government’s approach to the company. However, in 2012, when staff at the FTC recommended filing antitrust charges against Google due to anti-competitive behaviour, this was unanimously overturned by the presidentially appointed FTC commissioners. During his second term, Obama argued that European regulators were being too aggressive towards Google.
The context is very different than when Obama took office.
Sarah Miller, American Economic Liberties Project
However, Big Tech has lost its shine since then. “If you go back three, four or five years ago, Silicon Valley titans were seen as great American innovators that really could do very little wrong,” says Sarah Miller, executive director of the American Economic Liberties Project. “Obviously, that mindset has changed dramatically… the context is very different than when Obama took office.”
A recently published report from the House Judiciary Committee’s antitrust subcommittee argued that Facebook, Google, Amazon and Apple are monopolies and called for action to be taken to remedy this. Miller says that the report’s suggestions are “likely to be turned into an aggressive set of legislative proposals relatively early in the congressional term that will help shape the agenda on the tech front for the White House”.
There is a consensus that the antitrust investigations and other lawsuits started against Big Tech will continue under Biden. However, doubts remain that the report’s most radical interventions will be implemented.
“The most progressive voices are and will be heard, but they are unlikely to prevail in completely overhauling US antitrust law or in breaking up companies,” says Andrew Gavil, antitrust expert at Howard University School of Law Antitrust law. “Antitrust law and policy will change. It will become more attuned and responsive to the economic challenges of today’s economy. But radical changes and break-ups seem unlikely [without] very substantial evidence of wrongdoing.”