Robber Barons: Control Too Strong to Resist

Where Are the Left’s Modern Muckrakers?

Victor Davis Hanson
Where Are the Left’s Modern Muckrakers?
By Victor Davis Hanson
 
High-tech corporations have acquired massive power and wealth, dwarfing the might of the robber barons of the past.
In the late 19th and early 20th centuries, there was an epic fight of so-called muckrakers — journalists and novelists such as Frank Norris, Upton Sinclair, Lincoln Steffens, and Ida Tarbell, along with trust-busting politicians like Teddy Roosevelt — against rail, steel, and oil monopolies. Whatever one thought of their sensationalism and often hard-left socialist agendas, they at least brought public attention to price fixing, product liabilities, monopolies, and the buying of politicians.
No such progressive zealotry exists today in Silicon Valley and its affiliated tech spin-offs. And the result is a Roman gladiatorial spectacle with no laws in the arena.
In the last two elections, Facebook has sold its user data to Democratic and, apparently more controversially, Republican campaign affiliates. Google, Twitter, and Facebook have often been accused of censoring users’ expression according to their own political tastes. Civil libertarians have accused social-media and Internet giants of violating rights of privacy, by monitoring the shopping, travel, eating, and entertainment habits of their customers to the extent that they know where and when Americans travel or communicate with one another.
Apple, Alphabet (Google), Amazon, Microsoft, and Facebook are the world’s five largest companies in terms of stock value. Together they have market capitalization of about 3 trillion dollars, about the net worth of the entire country of Switzerland.
Until the rise of high-tech companies in the 1980s, there were, for better or worse, certain understood rules that governed the behavior of large corporations. Services deemed essential for the public — power, sewage, water, railroad, radio, and television — were deemed public utilities and regulated by the state.
Anti-trust laws prohibited corporations from stifling competition: Price cutting and fixing, dumping, and vertically integrating to ensure monopolies were all illegal. The government broke up large “trusts.”
The public looked askance at the power of mega-corporations and their ability to sway public opinion through the monopolistic purchases of media and advertising and their ability to liquidate smaller rival companies. Product liability laws, if often punitively and unfairly, held corporations accountable even for the misuse of their products: Smokers sued the tobacco companies when they suffered from lung cancer and emphysema. Baby cribs that had hard edges were liable for infant injury.
Yet today’s Silicon Valley and related high-tech companies are largely exempt from such traditional regulations. Facebook and Google run veritable monopolies. Facebook alone controls an estimated 40 percent of the world’s social-media market. It has more than 2 billion monthly users. Google controls about 90 percent of the world’s search-engine market. Apple earns $230 billion in annual revenue and is nearing a market value of $900 billion. Microsoft controls about 85 percent of the word-processing personal and business markets. Amazon alone was responsible for about 45 percent of all online sales of any sort last year. It has huge contracts with the Pentagon and owns the Washington Post. When competitors to Big Tech arise, they are offered billions of dollars, cashed out, and absorbed. Facebook has bought more than 50 rival companies. It acquired former competitor WhatsApp, the world’s leader in messaging platforms, for a staggering $19 billion. Alphabet/Google has bought more than 200 companies, YouTube among them.
The point of these surreal statistics about wealth, influence, and power is not to suggest that they prove abuse. Rather, they point to temptation. By itself, Facebook, which the government does not regard as a public utility, can adjudicate tasteful — or proper political — expression. Google alone determines each day what sort of imaging — much of it ideologically driven — billions of Internet users will see on screens. Disagree with Facebook, YouTube, or Google, and you will learn that it’s hard to find commensurate alternative services. If a particular historical video does not meet Silicon Valley’s correct narratives, YouTube will stifle it through “restrictive mode filtering,” as it has with many offered by Prager University, a conservative nonprofit.
Each year there are about 330,000 injuries caused by drivers texting — all of them in a sense preventable. One out of every four automobile accidents in American is said to result from texting while driving. Indeed, texting is six times more likely to cause a car accident than driving while intoxicated. Yet there are few consumer activist groups demanding products that cannot be misused by drivers, much less safety devices that automatically shut down texting when the user is moving at automobile speed.
None of these tech giants are held to the same oversight that monitors rail, drug, oil, or power companies.
Why is that?
The companies provide cool 21st-century products. People are mostly happy with the way they word-process, search, email, post, and buy online — at least until they butt up against the power of these monopolies and find their social-media accounts arbitrarily frozen, their private habits and data sold to other companies and operatives, their Internet use constantly interrupted by ads and messaging, or their providers using their patronage to massage the larger culture and law.
Unprecedented capital and revenue matter — both the fear of governments’ losing it and the hope of acquiring it. Jeff Bezos, owner of Amazon, is the world’s richest person, worth $112 billion. Bill Gates of Microsoft is second, at $90 billion, Mark Zuckerberg ($71 billion) is fifth. Civilization has never seen such Croesus-like concentration of personal wealth, and we are dumfounded by it.
In inflation-adjusted dollars, our tech masters of the universe dwarf the 19th-century so-called robber-baron fortunes of the Rockefellers, Carnegies, Fords, and Mellons that once prompted a cultural revolution of muckraking and trust-busting. Such huge amounts of capital, coupled with monopolies over the way much of the world communicates, gives just a handful of people never-before-seen political power.
The elections of entire nations, the tax policy of states, and the zoning laws of municipalities are in some degree affected by the decisions that a few make. The fear of losing tax income, or the desire of gaining huge tax revenue, holds elected officials hostage to the decision-making of such huge conglomerates.
Nationalism also explains why Big Tech is mostly unregulated. Why would Americans wish to hamstring some of the world’s largest companies when they ensure that American culture and practice saturate the cyber world?  Democrats, the traditional trust-busters and hyper regulators, appreciate the progressive politics and West Coast culture of corporations such as Facebook and Amazon. Republicans are wedded to free-market economics and are ideologically averse to intruding into the marketplace.
Even more significantly, high-tech companies have managed to thread the needle between the two political parties. Democrats, the traditional trust-busters and hyper regulators, appreciate the progressive politics and West Coast culture of corporations such as Facebook and Amazon. Why would they regulate entities that are a cash cow for the Democratic party and that push progressive agendas insidiously through daily Internet use? The worst-kept secret of the modern age is that big corporations are mostly run by leftists and are far more politically correct than independent small-business owners who lack the clout to enact social change by fiat.
On the other hand, Republicans and conservatives are wedded to free-market economics and are ideologically averse to intruding into the marketplace — even when they are often at odds with high-tech monopolies and sometimes targeted by them.
The owners and operators of Apple, Facebook, Google, and Microsoft certainly don’t look like the Jay Goulds and John D. Rockefellers of the past. Instead they wear shades, T-shirts, jeans and Dockers, sneakers and flip-flops as if they were regular guys and gals. When a hipster worth $70 billion looks no different from someone worth $50, how can he really exercise global power? Did anyone believe that the CEO of the now nearly defunct Theranos — cool thirtysomething Elizabeth Holmes, outfitted in Steve Jobs–lookalike black turtle necks — was a multibillion-dollar fraud of the first order, whose cool assurance led to the destruction of investors and sometimes lethal harm to individual patients?
We are in a brave new world of mobile communication, computers, the Internet, and social media without guidance from the past about whether these international and global mega-companies qualify as public utilities, monopolies, trusts — or quasi-independent and autonomous states that make their own laws and have no loyalties other than to themselves and their genre.
What is needed is some sort of bipartisan national commission that might dispassionately and in disinterested fashion offer guidelines to legislators about how to make sure that these companies do not abuse their enormous powers of surveillance and data acquisition, vast wealth, and monopolistic control of how we write, think, shop, and communicate — while ensuring that they can continue to offer the public what are now its daily necessities.
For now, things are going to get far worse before they get better. Big Tech has all the political, cultural, and commercial cards, and plays them with a reassuring hipster grin.
 
VICTOR DAVIS HANSON — NRO contributor Victor Davis Hanson is a senior fellow at the Hoover Institution and the author, most recently, of The Second World Wars: How the First Global Conflict Was Fought and Won.

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