Sen. Warren says tech giants like Amazon are helping to drive up prices
A Senate hearing held by prominent big tech critic Sen. Elizabeth Warren (D-Mass.) on Tuesday will focus on how market concentration in the technology sector may be driving up prices for consumers, with e-commerce titan Amazon poised to play a starring role.
In an interview with The Technology 202 ahead of the hearing, Warren said that supply chain issues and shortages on goods alone don’t fully explain recent pricing surges across the United States. Instead, she argued, it can be partly attributed to dominant tech companies being able to raise the cost of goods without the fear of facing more significant competition.
“We’ll talk about how industry concentration puts tech giants in a position to gouge consumers on profits,” Warren said in a phone interview.
It’s the first tech-focused hearing for the Senate Finance Committee’s fiscal responsibility panel since Warren, who made her critiques of the tech giants a signature issue during her unsuccessful 2020 presidential bid, took over the gavel. It shows Democrats are increasingly using fresh perches in the Senate to target industry titans.
Lawmakers are expected to put Amazon’s practices squarely in their crosshairs at the session, where they will hear testimony from an Amazon worker that has spoken out about its working conditions and an antitrust enforcer who is suing the giant over price-fixing allegations.
The worker, Courtenay Brown, recently spoke to my colleague Jay Greene about Amazon’s workplace surveillance practices and how she believes it has created a “demeaning” environment. (Jeff Bezos, who founded Amazon, owns The Washington Post.)
Warren said Brown can speak to “what it's like to work in a company that knows that if it squeezes its workers harder … that the company is so dominant in the region, that most of those workers will have no choice but to knuckle under and go along.”
The enforcer, D.C. Attorney General Karl A. Racine, accused Amazon in an ongoing lawsuit of fixing prices through contract provisions with third-party sellers who distribute their products on the e-commerce site. He argued it has led to “artificially high” prices on digital sales.
The argument resonated with Warren, who as a presidential candidate famously called for breaking up Amazon and proposed preventing tech giants from running a digital commerce platform and selling competing products on it.
“Amazon’s so-called fair pricing policy essentially creates a price floor that prevents other sellers from charging lower prices,” Warren said Monday during a phone interview.
Amazon spokeswoman Kelly Nantel said employee monitoring is a prudent business measure. “Like any business, we use technology to maintain a level of security within our operations to help keep our employees, buildings, and inventory safe — it would be irresponsible if we didn’t do so,” she said in an emailed statement.
Amazon has also disputed Racine’s allegations, with company spokesman Jack Evans saying in a statement after it was filed that the attorney general “has it exactly backward — sellers set their own prices for the products they offer in our store.” Amazon did not return a request for comment on Warren's remarks.
Warren has been sounding the alarm on allegations of anti-competitive conduct by the tech giants for years, but the issue has only gained significant bipartisan momentum in the past couple years.
That has stemmed in large part from the House Judiciary Committee’s sweeping investigation into the state of competition online, which zeroed in on the conduct of Amazon, Apple, Google and Facebook, since renamed Meta.
But their most aggressive proposal, which would prohibit tech platforms from operating a line of business that creates a conflict of interest, does not yet have a Senate counterpart. That bill, the Ending Platform Monopolies Act, is similar to Warren’s campaign proposal.
Asked about whether she has crafting legislation on the issue, Warren said, “I'm talking with other people in the Senate about action we should take and action we should take soon.”
While the push to revamp the nation’s competition laws and rein in the tech giants has picked up significant steam, Warren said so far the industry has been able to stave off reforms due to its massive lobbying influence.
“Whenever a senator considers going after Big Tech, that senator looks over their shoulder to see what Big Tech is doing, how Big Tech is going to respond,” she said. “So far, Big Tech has been able to beat back efforts to rein them in.”
Fred Hiatt, who edited The Post's editorial page, passed away. Here are some of his pieces on tech.
Hiatt, who died at age 66 on Monday, “was one of Washington’s most authoritative and influential opinion-makers,” Matt Schudel writes in a must-read obituary. Hiatt also opined on technology policy, writing blistering op-eds about our relationships with technology and Republican critiques of major tech companies.
“Social media exacerbates partisanship and elevates conspiracy theories over facts,” Hiatt wrote in January 2020. “The baneful influence of the Internet on democracy, in other words, is making it harder for democracy to tackle the Internet’s baneful effects.”
When President Donald Trump filed class-action lawsuits complaining that Big Tech was censoring conservatives, Hiatt wrote that they were “rightly derided as wrong on the facts, preposterous on the law and doomed to be thrown out of court.” But he also pondered the future of technology regulation, questioning the power of tech giants. Hiatt also touched on the subject of censorship and technology in a January 2021 op-ed on Sen. Josh Hawley (R-Mo.) and Trump.
Our top tabs
Nunes is leaving Congress to lead Trump’s social media venture
Rep. Devin Nunes (Calif.), the top Republican on the House Intelligence Committee, will become the chief executive of the Trump Media & Technology Group next month, Amy B Wang and David Weigel report. It comes months after Trump and his team announced that they would launch social media network Truth Social. Truth Social comes in response to major social media companies banning Trump in the wake of the Jan. 6 riot.
Meanwhile, federal regulators are investigating the company that plans to merge with Trump’s social media venture. Digital World Acquisition Corp. said in a regulatory filing that it received “certain preliminary, fact-finding inquiries” from the Financial Industry Regulatory Authority in October and November about stock trading regarding a merger agreement between the companies, Aaron Gregg reports. The Securities and Exchange Commission (SEC) has separately asked for information on meetings of the company’s board, communications and information on its investors, according to the filing.
The company said the filing shouldn’t be taken to indicate that the agencies have found that anyone broke the law. Trump and Digital World Acquisition Corp. spokespeople did not respond to requests for comment.
The White House is delaying the rollout of its Internet alliance
The National Security Council told the State Department on Sunday that it was delaying the launch of the initiative, Protocol’s Issie Lapowsky reports. The Biden administration had faced questions over the proposal, which it had originally framed as a group of like-minded democracies committed to supporting a free and secure Internet.
The Biden administration told digital rights groups on Monday that it was postponing the launch “in part to get more global South feedback and engagement,” a person on the call told Lapowsky. The administration originally planned to launch it at a Summit for Democracy that it’s hosting this week.
The SEC is investigating Tesla over solar panels
The probe comes after a whistleblower complaint that argued that Tesla didn’t properly inform shareholders and the public about the risk of fire from defects in the panels, Reuters’s Hyunjoo Jin and Chris Prentice report. The SEC disclosed the investigation in response to a Freedom of Information Act by Steven Henke, the former Tesla employee who filed the whistleblower complaint.
In the complaint, Henke said Tesla and SolarCity, which merged in 2016, didn't disclose the “liability and exposure to property damage, risk of injury of users, fire etc to shareholders” before and after the merger took place. The company also didn’t tell consumers about the risk of fire, Henke said.
Tesla did not respond to a request for comment from Reuters. The SEC declined to comment to the outlet.
Rant and rave
Tech Twitter weighed in on the retirement of Rep. Devin Nunes (R-Calif.). Journalist Casey Newton:
CNBC's Jay Yarow put it a bit more succinctly:
Journalist Kara Swisher:
Inside the industry
- Former FTC senior economist Julie Carlson is joining the Information Technology and Innovation Foundation as associate director of antitrust and innovation policy.
- Tim Wu, a special assistant to President Biden, speaks on the second day of a two-day FTC and Justice Department workshop today.
- Washington D.C. Attorney General Karl A. Racine (D) testifies at a Senate Finance subcommittee hearing on technology competition, growth and privacy today at 9:30 a.m.
- NATO Assistant Secretary General for Emerging Security Challenges David van Weel discusses artificial intelligence cooperation at an American Enterprise Institute event today at 9:30 a.m.
- Heather Boushey, a member of the White House’s Council of Economic Advisers, participates in a Brookings Institution event on technology and inequality on Wednesday at 11 a.m.
- Instagram head Adam Mosseri testifies before the Senate Commerce Committee’s consumer protection subcommittee on Wednesday at 2:30 p.m.
- The Senate Commerce Committee’s communications, media and broadband subcommittee holds a hearing on algorithmic harms on Thursday at 10 a.m.
- The House Energy and Commerce Committee holds a hearing on legislation targeting Big Tech on Thursday at 10:30 a.m.
- Intel CEO Pat Gelsinger speaks at the Economic Club of Washington D.C. on Thursday at noon.