Multinational corporations, including big banks and big businesses represented by the Chamber of Commerce, are lobbying against a plan by New York State legislators to take on concentrated corporate monopoly power by claiming it will hurt small businesses.
The legislation, known as S.B.933A, would amount to the “most significant legal challenge to big tech monopoly power in the country,” according to Matt Stoller, the Director of Research at the American Economic Liberties Project.
“Right now, to be considered subject to monopolization law, a firm has to have 70 to 90% of a market, plus it has to engage in egregious behavior that economists measure as inefficient,” Stoller wrote of the legislation last year:
This bill would blow up that entire framework. First, a firm would only have to have 40% of a market to be considered dominant. Plus, firms that are powerful enough to set wages across an industry, ahem Amazon, would also be considered dominant. It wouldn’t be illegal to be dominant, but under this legislative framework, dominant firms would no longer be allowed to engage in predatory conduct or block competitors from the market. [Emphasis added]
A group of multinational corporations and various Chamber of Commerce branches, represented by the Partnership for New York City organization, wrote a letter to New York legislators and Gov. Kathy Hochul (D) — using allegations that small businesses will be hurt to lobby opposition against the legislation.
“This legislation purports to curb the excesses of the largest companies, particularly ‘big tech,’ but would instead create a new level of risk, cost, and potential liability for all New York state businesses, large and small,” the heads of various corporations write:
If enacted, this law would make New York far less attractive for business investment and job creation, since it will put restrictions on New York firms that their competitors in other states and most countries would not be subject to. It would also discourage competitive business activities that benefit consumers with lower prices and innovative products. Ultimately, the result of this legislation will be lost jobs and reduced tax revenues. [Emphasis added]
The implications of these changes would be significant. New York would be an outlier in its antitrust enforcement posture not only in the U.S., but internationally. Moreover, the new rules will not improve the ability of state authorities to prosecute bad business conduct that hurts consumers. New York already has effective antitrust laws that are vigorously enforced by the Attorney General’s Office, often in close coordination with the federal antitrust enforcement agencies and sister agencies in other states. [Emphasis added]
The anti-monopoly legislation, though, is only likely to affect corporations with concentrated market power, many of whom signed onto the letter — including American Express, Condé Nast, Pfizer, McGraw-Hill Education, and Sullivan & Cromwell LLP.
American Economic Liberties Project details that “only a small proportion of firms will have any changes to their legal obligations, as most firms do not have market power” as a result of the legislation.
“Large corporations are using small businesses as a shield to protect their own anti-competitive behavior, but most small and medium firms simply do not have enough market power to fall under this bill’s purview,” the group notes.
As data has long revealed, a handful of corporations dominate vital markets in the American economy from retail to pharmaceuticals — often outsourcing the manufacturing and production of their products to foreign countries.
According to the Open Markets Institute, corporations like “Worldwide Nike controls almost two-fifths of the sports shoe business, a number that has grown since its two main rivals, Adidas and Reebok, merged in 2005” while “Amazon sells 74 percent of all e-books sold online, and it sells 64 percent of all print books sold online.”
John Binder is a reporter for Breitbart News. Email him at email@example.com. Follow him on Twitter here.