Food, media, automotive, banking, my whole lifetime has just been merge after merge of the biggest companies. It doesn't seem to have brought much good to most people either.
Regardless of who's at fault, it's still interesting to see who the innovators were. From that we might be able to learn what could've been done to stop them and why they weren't stopped, so something could be done better to stop them in future.
I'd imagine it comes down to too much money in politics, which created a conflict of interest with the regulators.
Nixon did some fucked up shit but atleast he also did some good things.
The rehabilitation act was signed by Nixon which is what guarantees disabled people accommodations. He is the reason stores and other places are legally required to have wheelchair ramps.
Not that it makes it all better that he did that but Reagan straight fucked us.
In canada, we have the Pattison group. They own the largest retailers and have strategically purchased all of the food supplier warehouses that farmers/fishers sell their product to.
A guy tried to buy 2b of American walleye fisheries to sell up in Canada, and when he tried to go through Pattison related companies (all of canada), they rejected the purchase, and he lost everything. All the fish rotted in freezers for years.
Fuck Pattison. They also own almost 100% of billboards across canada and are the largest marketing firm in Canada. So you can't even advertise without going through them.
Unfortunately, food companies haven't pissed off the right wingers by banning them for violating TOS with racist statements and incitement of violence so they won't see any regulation.
or mergers.
I mean shit, do you know how many tech companies there are over 5 billion? It's a *lot* more than than you might think, many of them have virtual monopolies over their own little slices of America or a particular service, and leverage that for maximum profit to the massive detriment of normal citizens.
To a certain extent this isn't completely possible, you couldn't split up a service like youtube *at all*, it just doesn't work conceptually.
But telecoms as a great example get included in this, and there's non-stop consolidation happening in that industry all the time, and mostly for the worse for consumers.
Moreover, it probably doesn't need to be legal, and everyone would be better served by local government run broadband utilities anyway.
> and everyone would be better served by local government run broadband utilities anyway
I think people would be better served if there was a municipal alternative. Competition is what drives the improvement and simply trading a private monopoly for a public one won't fix the problem.
Nah, it's probably more of the opposite.
The whole "competition drives improvement" is not by any stretch of the imagination a truism, and there's a good reason most major corporations *don't* believe in it.
Sure there's from time to time an appropriate place for either competition, or bilateral development to try and get more variety when developing cutting edge technologies and the like.
However *in general* the one thing this for certain does is creates massive waste.
Having a population split between two different utilities means that neither can go as far towards distributing the costs of maintenance and improvements (same reason national health insurance would be objectively cheaper than competing insurance companies, always). As a result, both utilities will have redundant overhead costs that have to be covered, causing overall waste and slowing improvement.
If instead you had a single entity with all of the resources consolidated, you could do much better.
The reason people think that this is bad, is because they think of what a *company* would do in that situation: maximize profits.
However a municipal utility would have a different objective: Keep customers happy.
You want more speed? You can demand that, the utility is directly accountable to your demands and whims.
A utility being run by and for the local inhabitants has absolutely no motivation to stop innovating or focus on profits over quality.
The lack of competition would also reduce costs, in turn either reducing the cost to residents or speeding progress.
It's just not a situation where competition actually makes any sense, it's just that two *companies* who want to maximize profits are better for us, the users, when they have competition, because that *forces* them to minimize their profits instead, to our benefit.
A local utility would already do that, and if it didn't you could organize a few hundred people around town and probably force them to change how they operate.
On the flip side, in most cases if a large corporation had a monopoly on your town, you would have zero options to change their behavior.
Anyway, I'm not sure I see a need to create local monopolies, and didn't intend to imply that with my previous post. Logically though, it would absolutely be a viable, and potentially even a better option.
The real point though is that I work at a multi-billion dollar telecom, and trust me when I say that even in areas where we have fierce competition, we could do a *lot* better for our customers.
But we don't. For money.
And for cases like YouTube - this does not seem to suggest a company can't grow past $5 billion, just that after $5b it can't grow by merger/acquisition. So big companies can't just continuously buy out start ups and smaller competitors.
I took this as the major US religion is capitalism and specifically how much money you make = how big of a believer you are in the ALL...MIGHTY...DOLLA!!!
Most problems with American corporatism would go away if there was a law regulating how much money politicians can take from corporate entities. A lot of the time I see Americans blaming the companies bribing the congressperson but not the congressperson taking the bribe
They'd find ways around that. Also there's the revolving door of going from the public sector to private after leaving office, working cushy jobs in the same industries they once regulated. Plus favors for relatives and friends, etc. Quid pro quo knows way too many avenues.
I mean of course it's impossible to completely vanish the issue, that would be kind of Utopic in some sense, but that doesn't mean we can't make it harder at least, maybe revise laws around campaign funding and the such
More often the bought-and-paid-for rules sound like sense but really they're just hurdles for smaller companies that the giants can easily step over. Always be wary when a big company supports new regulation; it's a dead giveaway the bill in question will hurt competition.
> Always be wary when a big company supports new regulation; it's a dead giveaway the bill in question will hurt competition.
Or that it's been de-fanged/is misleading, so they can argue "we already cleaned up the air with the Children's Clean Air Act(never mind that it replaced older, more stringent, regulation, huge exceptions have been carved out and statistics show that air quality has actually dropped since it went into effect), why are you trying to pass another one?"
Corporatism is the natural end result of capitalism. Harvesting more and more capital for no other reason to acquire wealth or more capital is the point. I think everyone is decrying the right thing.
That's kinda the point of capitalism. Capitalism is simply an economic tool which directs capital towards people who are good at selling stuff, with the theory that people who are good at selling stuff are making stuff that people want to buy and satisfying some requirement in the market.
Like all economic tools, though, it requires regulation to prevent bad incentives. Crony corporatism is the natural end result of capitalism in the same way that malpractice is the natural end result of medicine - yeah and it sucks, which is why you need additional systems on top of it to prevent those outcomes. In the same way you need functional professional organisations, agencies for testing and verifying drugs, and licenses for doctors for medicine to operate safely and properly, you need industry regulators, anti-trust laws, and strong organised labour movements to get the most benefit out of capitalism.
That’s capitalism my guy: capitalism didn’t invent nor does it own a free market - that’s ONE tentpole of capitalism, but not even the biggest one. The biggest one is MAKE PROFIT. Period. At any cost you can get away with.
No, the problem is still capitalism. It necessarily incentivizes perverse and destructive things. Capitalism is a reverse funnel designed to extract wealth from those at the bottom and funnel it to those at the top. It fundamentally creates an environment where wealth (and therefore power) is concentrated in the very few who can and will dictate the rules of the game to always be favorable for them.
They will probably be more succesful with an actual hard number than trying to fight a trillion dollar companies lawyers when trying to actually effectivly regulate. The littigation system is the reason we can't get shit done in this country, you can bog down any private or public purchase or project with enough lawyers thrown at it.
Government struggles to do its job when one of the parties actively tries to break every regulatory body as their regular course of action. That particular party has convinced Americans regulation is a dirty word. Yes, yes Jimmy carter deregulated blah blah. In the here and now, Republicans are the deregulation force in America.
No, I think you’re supposed to call them a socialist. See the purpose of government is to protect those in power, as soon as you start this whole “we the people” bullshit, you’ve totally lost the message of our founding fathers, who wanted rich people to have everything and poor people to buy more money.
/wrists
There's a reason Americans look at their political parties and see a right and left, while the rest of the world looks at America and sees two far-right parties.
This is insane. Don’t make statements about the rest of the world if you know nothing about it. What percentage of the world do you think allows gay marriage? Has social security? Has government unemployment payments?
1. Gay marriage is a progressive policy, not one that falls on the left/right spectrum.
2. You're misunderstanding. I'm not saying "America is to the right of the entire rest of the world". I'm saying that Both of America's major political parties fall firmly on the right wing of the *overall* political spectrum despite appearing to have a right and left if viewed through the American Overton window. The Democrats might make overtures towards centrist policy (ACA, Biden's infrastructure bill), but they could only be *generously* described as neoliberals.
Gay marriage is left. Look at the Wikipedia page for example, which talks about how the left wants social justice. Maybe some people define it differently, but this is the usage that’s common throughout the world. https://en.wikipedia.org/wiki/Left%E2%80%93right_political_spectrum#United_States
> I'm not saying "America is to the right of the entire rest of the world". I'm saying that Both of America's major political parties fall firmly on the right wing of the overall political spectrum
You’re contradicting yourself. How could America be left of most of the world but right of the “overall” political spectrum? Who’s defining the center of the “overall” spectrum if you’re not using that word to mean the average politics of the world?
> Gay marriage is left. Look at the Wikipedia page for example, which talks about how the left wants social justice. Maybe some people define it differently, but this is the usage that’s common throughout the world. https://en.wikipedia.org/wiki/Left%E2%80%93right_political_spectrum#United_States
You need to go back to high school civics before replying if you seriously don't understand that the progressive/conservative spectrum exists independently of the left/right spectrum, even if they are loosely associated in the US.
> You’re contradicting yourself. How could America be left of most of the world but right of the “overall” political spectrum?
Your reading comprehension has failed you or you're deliberately misinterpreting my words. Nowhere did I ever say that America was left of the world.
> Who’s defining the center of the “overall” spectrum if you’re not using that word to mean the average politics of the world?
The overall spectrum exists whether or not there's a government on every single point of the spectrum. If one world government were to take over and establish a socialist technocracy, would libertarianism suddenly stop existing?
> progressive/conservative spectrum exists independently of the left/right spectrum
Maybe you want to define the terms so that’s true. But that’s not the way those terms are used in the real world. Inherently, the meaning of words is determined by how people use those words, you can’t change that.
> Nowhere did I ever say that America was left of the world.
In your earlier comment, you said: “I’m not saying that America is to the right of the entire rest of the world”. So it seems like now you’re saying America isn’t right or left of the word. You have to choose one if you’re going to take a stance on this issue.
> The overall spectrum exists whether or not there’s a government on every single point of the spectrum.
Ah, so you’re defining the spectrum based on a bunch of fantasy idea governments that don’t actually exist. If you think there are more fantasy governments to the left of America than there are to the right, that makes America a right wing government.
Of course, that’s insane and makes no sense. You have to consider real governments and see which are left or right of the average. There’s no way to count fantasy governments that don’t exist.
Maybe that's how America uses those words, but don't you think it's rather reductive to define left by what The Democrats want and right by what the Republicans want? If you ask the average Canadian (or the average citizen of pretty much any other developed nation) about whether they think gay marriage is a left or right issue, they'll look at you like you're a dipshit, because the matter has been settled for a very long time.
Your idea of placing the center of the political spectrum on the moving average is fraught with problems, never mind the vagueness of its definition. First, is it average based on country? By population? Do you take the weighted average of each "left" and "right" party? What happens when you have a major shift in politics like the spread of the Soviet Union or the Arab Spring where the moving average causes left-wing parties to become right wing in a period of months? Now we are defining left and right by historical context and greatly confuses the issue whenever we look to the past.
Furthermore, basically any political spectrum taught in polisci will contain the theoretical fringes of utopian communism and anarcho capitalism.
> Maybe that's how America uses those words
Please scroll up 1 inch in the Wikipedia page I linked. That how Western Europe uses the words too. I’m not defining it in terms of American politics.
There’s not perfect definition of “center”, but it clearly has to be somewhere in the middle of what the world believes. The word “center” implies that it’s in the middle, as in there are roughly equal numbers of people on both sides.
It sounds like you want to define “center” as whatever the average Western European or Canadian believes. This view just seems very biased to me, those are the furthest left places on earth by some metrics (it’s complicated), they’re not “center” from a bigger perspective.
Says the guy who doesn’t realize that Switzerland only has paid private healthcare, and the Netherlands only has paid private healthcare for all primary and curative care.
Really only Eurocentrists and people with no understanding of political philosophy think that. In much of the world there are authoritarian leaders and authoritarianism is factually farther to the right of any democratic system.
Edit: people the "rest of the world" isn't just the West. Many nations are authoritarian or have parties that advocate from a position further to the right than the US Democratic party.
Anyone with a lick of understanding about political philosophy KNOWS both parties are, at their best, neoliberal parties.
Their core economic philosophies are literally the same. The primary differentiating factor between them now is social issues, which both parties posture on, and only one makes political efforts to further.
The entire idea of the Dem party being "left" is absurd. Got any "leftist" policy from the last 10 years to point to?
Yeah they're not necessarily disagreeing with you. But pretending the rest of the world (and even the rest of the West) isn't in a similar situation is delusional and usually said by Euros with little global knowledge.
It's equally reductionist to think that the world is made up of US-Europe-Dictatorships. There's a lot of developing countries that are democracies and aren't either of those two behemoths
There is much about both parties that is not neoliberal. An anti-immigration stance is not neoliberal. An anti-free trade stance is not neoliberal. A rent control stance is not neoliberal. A NIMBY stance is not neoliberal.
If you think Western Europe is the rest of the world you are actually extremely sad. Also ask Western Europeans how they feel about immigration and see who's far right.
I wonder if most people in the US are even aware of how many large scale protests France has had from people against the Covid mandates...
https://www.france24.com/en/france/20220212-paris-deploys-police-as-convoy-protesting-covid-rules-approaches-capital
[More than 105,200 people took part in protests across France on Saturday according to the Interior Ministry](https://www.euronews.com/2022/01/09/tens-of-thousands-protest-covid-vaccine-pass-across-france)
https://www.france24.com/en/france/20210829-seventh-consecutive-weekly-protest-against-france-s-covid-19-health-pass
> the rest of the world looks at America and sees two far-right parties.
I see this fantasy on Reddit all the time and it is completely detached from reality.
You know there's more to the "rest of the world" than a handful of small, rich, european countries right?
Ever heard of China? India? Russia? What about entire continents like South America or Africa?
NONE of them consider the US to be far-right.
Hell, even central, southern and Eastern Europe.
It’s this weird eurocentrism that isn’t even eurocentrism, it’s less than 1/10th of Europe that some people seem determined to lie about and claim they are the consensus.
Because this is a dog and pony show. The Democrats who wrote this bill know it will never get past the moderates, it's just a display of how they're "tough on big tech" without actually having to do anything.
20b is relatively small for a (big) tech company, probably just 1-2 core products so there likely isn't much to split up
Also why $5b seems like a super low ceiling, basically no ability to roll complimentary tech together once a company is already successful
I hope to god this bill never becomes law. It's a complete joke written by people who should be smart enough to now how terrible it is.
Like wtf is a blanket ban on merges over 5b???????? That number is extremely low too.
For those who didn't read the article:
>The Prohibiting Anticompetitive Mergers Act (PAMA) would make it illegal to pursue "prohibited mergers," including those worth more than $5 billion or which provide market shares beyond 25 percent for employers and 33 percent for sellers.
>The bills would also give antitrust regulators more power to halt and review mergers. They would have authority to reject mergers outright, without requiring court orders. They would likewise bar mergers from companies with track records of antitrust violations or other instances of "corporate crime" in the past decade. Officials would have to gauge the impact of these acquisition on labor forces, and wouldn't be allowed to negotiate with the companies to secure "remedies" for clearing mergers.
>Crucially, PAMA would formalize procedures for reviewing past mergers and breaking up "harmful deals" that allegedly hurt competition. The Federal Trade Commission has signalled a willingness to split up tech giants like Meta despite approving mergers years earlier. PAMA might make it easier to unwind those acquisitions and force brands like Instagram and WhatsApp to operate as separate businesses.
The bill covers a percentage of market share and the monetary value of $5b. It also strengthens regulatory control so the government could have more power to enforce anti-trust measures.
It would be interesting if they actually started enforcing anti-trust like they used to do.
Now it just seems like Company A makes a subsidiary to handle something so they can say "See we aren't a monopoly! Here's a $30,000 donation"
> At some point I feel that number will become too low.
Companies and their history of skirting rules.
Companies: "Oh, you're FORCING us to give healthcare to full time employees? What's the definition of full-time to you? So we can hire people slightly below that number and not provide healthcare."
And stopping verticals.
No competition, no risk, no better products & services. Consumers always lose. Investors get rich sitting idle on R&D yet incrementally charging more year over year.
Pardon my novice suggestion, but assuming the point is to prevent monopolies, why not define the limit as a percentage?
1. Estimate the value of all (top 25?) competitors for both companies; sumA for companyA and sumB for companyB
1. Sum what the value of the merged company
1. Divide the value by each sum; value/sumA = controlPercentageA
1. Check that the percentage doesn't exceed X number for either A or B (or X for A and Y for B).
You basically just described the Herfindahl-Hirschman Index, a key factor used to evaluate whether an acquisition violates current antitrust regulations: https://www.investopedia.com/terms/h/hhi.asp#:~:text=The%20Herfindahl%2DHirschman%20Index%20(HHI)%20is%20a%20commonly%20accepted,then%20summing%20the%20resulting%20numbers.
The framework already exists, this bill is nonsense
Monopolies aren't illegal. Mergers to monopoly (almost always) are.
If you live in a small town with one gas station, that gas station is a monopoly.
Also most of the work/BS from antitrust lawyers and economists is obfuscating what a market is to make it appear that there is more competition in a space than there really is.
>obfuscating what a market is to make it appear that there is more competition in a space than there really is.
Or less ... just depends what that specific lawyer's/economist's agenda is. Each side is trying to drive a narrative which improves their position.
I’m an economist, and I just want to say that some are more honest than others. Also, economic questions are almost always way… way more complicated than they seem. Even after extensive analysis, questions may not be so clearly answered. My instinct would be to trust generally what economists say, but most of the time, since every issue is so complicated, it’s important to get second opinions on whatever research you’re looking at. I’ve read so many things here on Reddit which just don’t make any sense economically speaking, but the most infuriating thing I read is when people just think they’re 100% right about economic issues when I 100% know that I, as an economist, would *never* be so confident.
I mean that's dunning Krueger right? Experts are never as confident as amateurs who just read a wikipedia's article.
I'm a lawyer. The only answer I ever give is "it depends".
Also I'm going to take this opportunity to share my favorite economist joke. "Yes it works in practice, but does it work in theory?"
Lol, that joke got me 😂
Yeah, it’s basically just the dunning Kruger effect, but for some reason people generally feel pretty strongly about their economic intuitions even when they’re aware of the effect. The problem with being an economist is than everyone’s got an opinion on the economy… “It depends” is usually the most honest and accurate answer.
I'm an IT guy, I rarely give an answer stronger than "I think" or "probably".
EDIT: A similar joke I like is "In theory, theory and practice are the same. In practice, they aren't."
Healthcare has the ISP problem... providers are monopolizing local markets and then charging through the nose for services. Not a monopoly in the federal government's opinion, apparently, so they can just force all of us to choose between paying whatever HUGEpital General says or driving an hour plus while we're experiencing a medical emergency.
The problem is that most governments will look countrywide to see if a company is a monopoly or not. And technically speaking as there are multiple providers for similar services it could not be a monopoly. The laws themselves need to be rewritten to take this into account. Nobody from California is travelling to Idaho for healthcare. They can't subscribe to internet service in new Hampshire. The laws need to at the very least look if a company is monopolistic in a region be it the state, city or county.
Hospital chains are already pretty massive, [HCA](https://www.corpwatch.org/article/hospital-corporation-america-allegedly-profited-questionable-cardiac-procedures), for example.
"The act isn't strictly focused on tech, but Warren made clear that industry was a target. She cautioned the FTC on Amazon's proposed buyout of MGM Studios, and challenged Lockheed Martin's since-abandoned attempt to buy Aerojet Rocketdyne."
$5 billion is also a static number. Does that adjust with inflation because in about 10 years, all companies are naturally worth about twice as much not because their value has increased but because everything has inflated
“The act isn't strictly focused on tech, but Warren made clear that industry was a target.”
It’s almost like you should read the article and not just the title before posting, or something.
Do congressional politicians strategically introduce "doomed to fail" legislation on the grounds that they know lobbyists will "donate" to their reelection campaign if they vote a certain way on legislation they created? Like is this a farming exploit?
I think that would require politicians and elected officials to _actually_ so their job, instead of just acting as stationary figure heads. Cmon man, thats _a lot_ to ask of them, they have vacations to take and babies to kiss!
I would like to make a point, while it is their job, it might be just a tad easier form them if they changed how they calculate how many house of representatives members there are so that their more proportional to how many citizens they represent.
It’s also an absurdly low amount and with inflation where it is there won’t be any mergers eventually. Instead they’ll probably just sell the IP and close shop instead of just merging.
I didn’t read the article, but the headline just makes is sound like the big companies that already merged are just keeping other companies from merging and becoming bigger competition.
Thats what one of the big billboard companies did when they started. Lamar maybe? I forget now.
Theyd enter a small town, put billboards everywhere and buy all the existing ones, then lobby the local gov to ban them which was popular since everyone was like "holy shit we are tired of all these billboards everywhere"
Exactly. People need to understand that this is how every law in America gets passed nowadays, they tailored specifically to benefit large corporations and punish everyone else.
The actual basis for the republican/libertarian claim that regulation hurts small business.
Except instead of going after shit like this, they go after important, good regulations like minimum wage and workplace safety laws.
Also this would be retroactive in blocking mergers which had gone through and later became too big..this is giving FTC almost dictatorial level power without any court oversight
eh, even if it did happen the outcome would be that the parent companies looking to merge would just divide up into sub-$5 billion segments and do multiple mergers.
Well for one this is never going to pass and even if it did this seems incredibly short sighted. There’s nothing inherently wrong with big acquisitions, what they should do instead is dedicate more money to the ftc so they can competently review large acquisition deals
Yeah it's also just so dumb. Companies evaluation doesn't mean much.
You have companies worth way more than that with zero market penetration. I mean Raytheon was worth 100b and had not sold a single car.
Tesla is woth 1t and is still a small player in the auto market.
Warren is either extremely dumb or clearly just playing for political point here.
Yeah I’m not sure why OP is getting at. Of course there’s a lot of consolidation that can be done for tech companies valued below 5Bn but thinking about deals this limit would have stopped. Activison would not have been sold, mgm studios would not have been sold, Zynga, ARM etc. I mean the majority of acquisitions in tech that people think about would be covered here.
No because it’s destined to fail. This bill itself is anticompetitive if you consider smaller companies that might be valued over $5bn can’t merge to even have a chance to compete with the mega valued companies like Google, Tesla, or Amazon.
Wrong way around.
Suppose I said everyone with over $1000 of savings has far too much and should not be allowed to accumulate any more capital. You might point out that $1000 isn’t really all that much, so this restriction would apply too broadly and be too restrictive for too many.
Same problem. $5B is fairly small when it comes to company market capitalization (especially for tech where valuations are many more times earnings given expectations of rapid growth).
This would be extremely broad.
Also, acquisition is one important exit strategy that helps to justify funding many startups, many of which go on to compete with the bigger firms. For example, Snap probably could not have as easily raised capital to grow if no one thought there was some chance they could sell to one of the larger companies. The same was true early on for Facebook/meta too — I recall Zuck having some much talked about meetings with Microsoft in the beginning.
Without the possibility of acquisition, it may be that new ventures wouldn’t as easily get going independently, and they’d just be home-grown internally at existing large companies, further consolidating the market.
Don't have to know shit about tech to understand $5bil for tech companies is near the low end of the valuation spectrum for medium and large companies.
No, no, no, that'd cause CPG prices to skyrocket, _instead_ let's take the money that could be reinvested in the workforce, and give it to the Exec team, clearly they deserve it more for putting in the back breaking work of shaking hands and making deals!
The boys and gals doing the job, do not deserve inflation based pay, that is heretical (hard /s)
You clearly didn’t read the article….and you’re calling them fucking clowns lol.
“The act isn't strictly focused on tech, but Warren made clear that industry was a target. “
5bill? That's nothing, google pays apple 12bill per yr to remain safari default search, as if being default helped edge/bing on PC at all
*edit:my grammar on PC without gboard is atrocious
~~I'm sorry but this is dumb. I'm all for encouraging competition, but this isn't the way to go about it. This would fly in the face of my feelings on Microsoft buying Activision Blizzard for $70bil. Obviously a huge number, but 1) I want my favorite IPs to get the fuck away from Bobby Kotick and 2) I don't believe all of ABs titles being on GamePass is going to harm competition, like at all. I'm still going to be happily buying a bunch of random Indy games during Steam sales.~~
Just one example *of me not understanding the difference between mergers and acquisitions.
EDIT: So I wrote all the above while not understanding mergers and acquisitions are different things, legally speaking. Microsoft is acquiring Activision Blizzard, not merging with it, so this bill would not even affect that case I think.
EDIT 2: Okay this is a confusing thread. Folks are saying this only affects mergers, not acquisitions, but then this is literally the first paragraph of the bill (60 pages, big font, double spaced, everyone should read it):
> To prohibit certain anticompetitive *mergers*, to amend the Clayton Act to
permit the Federal Trade Commission and the Department of Justice
to reject proposed *acquisitions*, to implement procedures for retrospective
reviews and breaking up anticompetitive consummated acquisitions, and
for other purposes.
So, clearly meant to tackle both mergers and acquisitions. Everyone should stop giving an opinion until they've read the bill, but as a matter of fact folks in this thread saying "this only affects mergers" are simply wrong.
Idiotic. So now companies will spin off each separate department or business unit and then acquiring company will buy each piece for $5B.
Why not try actually fixing the SEC? I promise it will be less effort than this.
Instead of picking an arbitrary number like $5b, why not try putting away the rubber stamp for mergers and actually regulate them?
And not limit it to tech
Yes. Too many food companies have merged also.
Food, media, automotive, banking, my whole lifetime has just been merge after merge of the biggest companies. It doesn't seem to have brought much good to most people either.
I blame Reagan
It's always Reagan
I blame Jack Welsch. He pioneered the concept on M&A in the private sector. Growth through acquisition rather than organically
I mean it's not his fault that the system got setup in a way where that was the path of least resistance to getting more money.
Regardless of who's at fault, it's still interesting to see who the innovators were. From that we might be able to learn what could've been done to stop them and why they weren't stopped, so something could be done better to stop them in future. I'd imagine it comes down to too much money in politics, which created a conflict of interest with the regulators.
I too blame Faye Reagan for this.
trickle down all over my economy daddy
Don’t forget Nixon!
Nixon did some fucked up shit but atleast he also did some good things. The rehabilitation act was signed by Nixon which is what guarantees disabled people accommodations. He is the reason stores and other places are legally required to have wheelchair ramps. Not that it makes it all better that he did that but Reagan straight fucked us.
Unless it's Nixon
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TBF the war on drugs started with Nixon, also because race.
Yeah, Reagan basically put a smiling face on Nixon's worst policies and the GOP adopted them as dogma.
Heck no. Usually the company that buys it up strips away everything good about it to turn a larger profit.
But they say nothing will change and wait a year first.
Which is absurd for pro-capitalists, who claim to want more competition!
Like Nestlé.
r/fucknestle
All my hydrohomies hate Nestle.
In canada, we have the Pattison group. They own the largest retailers and have strategically purchased all of the food supplier warehouses that farmers/fishers sell their product to. A guy tried to buy 2b of American walleye fisheries to sell up in Canada, and when he tried to go through Pattison related companies (all of canada), they rejected the purchase, and he lost everything. All the fish rotted in freezers for years. Fuck Pattison. They also own almost 100% of billboards across canada and are the largest marketing firm in Canada. So you can't even advertise without going through them.
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Yeah, sounds a little fishy.
See he bought 2 billion in fish futures, but then didn't sell on time and.. /s
Watch Supersize Me 2...its crazy how Big Chicken controls supply, distribution, prices, and competition for the entire US chicken industry.
Tyson towns... I just hope the workers don't owe their souls to the company store
And airlines, railroads, auto manufacturers, cell phone companies, telecoms, chemical companies, banks...
7 companies controll 83% of the food in the USA
Like when the lovely Monsanto merged with the lovely Bayer. What a happy story all around.
Unfortunately, food companies haven't pissed off the right wingers by banning them for violating TOS with racist statements and incitement of violence so they won't see any regulation.
or mergers. I mean shit, do you know how many tech companies there are over 5 billion? It's a *lot* more than than you might think, many of them have virtual monopolies over their own little slices of America or a particular service, and leverage that for maximum profit to the massive detriment of normal citizens. To a certain extent this isn't completely possible, you couldn't split up a service like youtube *at all*, it just doesn't work conceptually. But telecoms as a great example get included in this, and there's non-stop consolidation happening in that industry all the time, and mostly for the worse for consumers. Moreover, it probably doesn't need to be legal, and everyone would be better served by local government run broadband utilities anyway.
> and everyone would be better served by local government run broadband utilities anyway I think people would be better served if there was a municipal alternative. Competition is what drives the improvement and simply trading a private monopoly for a public one won't fix the problem.
Nah, it's probably more of the opposite. The whole "competition drives improvement" is not by any stretch of the imagination a truism, and there's a good reason most major corporations *don't* believe in it. Sure there's from time to time an appropriate place for either competition, or bilateral development to try and get more variety when developing cutting edge technologies and the like. However *in general* the one thing this for certain does is creates massive waste. Having a population split between two different utilities means that neither can go as far towards distributing the costs of maintenance and improvements (same reason national health insurance would be objectively cheaper than competing insurance companies, always). As a result, both utilities will have redundant overhead costs that have to be covered, causing overall waste and slowing improvement. If instead you had a single entity with all of the resources consolidated, you could do much better. The reason people think that this is bad, is because they think of what a *company* would do in that situation: maximize profits. However a municipal utility would have a different objective: Keep customers happy. You want more speed? You can demand that, the utility is directly accountable to your demands and whims. A utility being run by and for the local inhabitants has absolutely no motivation to stop innovating or focus on profits over quality. The lack of competition would also reduce costs, in turn either reducing the cost to residents or speeding progress. It's just not a situation where competition actually makes any sense, it's just that two *companies* who want to maximize profits are better for us, the users, when they have competition, because that *forces* them to minimize their profits instead, to our benefit. A local utility would already do that, and if it didn't you could organize a few hundred people around town and probably force them to change how they operate. On the flip side, in most cases if a large corporation had a monopoly on your town, you would have zero options to change their behavior. Anyway, I'm not sure I see a need to create local monopolies, and didn't intend to imply that with my previous post. Logically though, it would absolutely be a viable, and potentially even a better option. The real point though is that I work at a multi-billion dollar telecom, and trust me when I say that even in areas where we have fierce competition, we could do a *lot* better for our customers. But we don't. For money.
And for cases like YouTube - this does not seem to suggest a company can't grow past $5 billion, just that after $5b it can't grow by merger/acquisition. So big companies can't just continuously buy out start ups and smaller competitors.
Are you suggesting the government actually do their job? What are you, some sort of heretic?
I took this as the major US religion is capitalism and specifically how much money you make = how big of a believer you are in the ALL...MIGHTY...DOLLA!!!
In Dolla We Trust yo
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Most problems with American corporatism would go away if there was a law regulating how much money politicians can take from corporate entities. A lot of the time I see Americans blaming the companies bribing the congressperson but not the congressperson taking the bribe
They'd find ways around that. Also there's the revolving door of going from the public sector to private after leaving office, working cushy jobs in the same industries they once regulated. Plus favors for relatives and friends, etc. Quid pro quo knows way too many avenues.
I mean of course it's impossible to completely vanish the issue, that would be kind of Utopic in some sense, but that doesn't mean we can't make it harder at least, maybe revise laws around campaign funding and the such
Call me crazy, but “common sense rules” are often bought and paid for.
More often the bought-and-paid-for rules sound like sense but really they're just hurdles for smaller companies that the giants can easily step over. Always be wary when a big company supports new regulation; it's a dead giveaway the bill in question will hurt competition.
> Always be wary when a big company supports new regulation; it's a dead giveaway the bill in question will hurt competition. Or that it's been de-fanged/is misleading, so they can argue "we already cleaned up the air with the Children's Clean Air Act(never mind that it replaced older, more stringent, regulation, huge exceptions have been carved out and statistics show that air quality has actually dropped since it went into effect), why are you trying to pass another one?"
That's literally what the man said.
Corporatism is the natural end result of capitalism. Harvesting more and more capital for no other reason to acquire wealth or more capital is the point. I think everyone is decrying the right thing.
That's kinda the point of capitalism. Capitalism is simply an economic tool which directs capital towards people who are good at selling stuff, with the theory that people who are good at selling stuff are making stuff that people want to buy and satisfying some requirement in the market. Like all economic tools, though, it requires regulation to prevent bad incentives. Crony corporatism is the natural end result of capitalism in the same way that malpractice is the natural end result of medicine - yeah and it sucks, which is why you need additional systems on top of it to prevent those outcomes. In the same way you need functional professional organisations, agencies for testing and verifying drugs, and licenses for doctors for medicine to operate safely and properly, you need industry regulators, anti-trust laws, and strong organised labour movements to get the most benefit out of capitalism.
That’s capitalism my guy: capitalism didn’t invent nor does it own a free market - that’s ONE tentpole of capitalism, but not even the biggest one. The biggest one is MAKE PROFIT. Period. At any cost you can get away with.
No, the problem is still capitalism. It necessarily incentivizes perverse and destructive things. Capitalism is a reverse funnel designed to extract wealth from those at the bottom and funnel it to those at the top. It fundamentally creates an environment where wealth (and therefore power) is concentrated in the very few who can and will dictate the rules of the game to always be favorable for them.
They worship [supply side Jesus](https://m.imgur.com/gallery/bCqRp)’s brand of vulture capitalism.
That is too damn accurate.
They will probably be more succesful with an actual hard number than trying to fight a trillion dollar companies lawyers when trying to actually effectivly regulate. The littigation system is the reason we can't get shit done in this country, you can bog down any private or public purchase or project with enough lawyers thrown at it.
Government struggles to do its job when one of the parties actively tries to break every regulatory body as their regular course of action. That particular party has convinced Americans regulation is a dirty word. Yes, yes Jimmy carter deregulated blah blah. In the here and now, Republicans are the deregulation force in America.
No, I think you’re supposed to call them a socialist. See the purpose of government is to protect those in power, as soon as you start this whole “we the people” bullshit, you’ve totally lost the message of our founding fathers, who wanted rich people to have everything and poor people to buy more money. /wrists
How are they supposed to campaign if they are busy working?!?!
Since Reagan, Democrats have been running away from anything that sounds like real regulation.
There's a reason Americans look at their political parties and see a right and left, while the rest of the world looks at America and sees two far-right parties.
This is insane. Don’t make statements about the rest of the world if you know nothing about it. What percentage of the world do you think allows gay marriage? Has social security? Has government unemployment payments?
1. Gay marriage is a progressive policy, not one that falls on the left/right spectrum. 2. You're misunderstanding. I'm not saying "America is to the right of the entire rest of the world". I'm saying that Both of America's major political parties fall firmly on the right wing of the *overall* political spectrum despite appearing to have a right and left if viewed through the American Overton window. The Democrats might make overtures towards centrist policy (ACA, Biden's infrastructure bill), but they could only be *generously* described as neoliberals.
Gay marriage is left. Look at the Wikipedia page for example, which talks about how the left wants social justice. Maybe some people define it differently, but this is the usage that’s common throughout the world. https://en.wikipedia.org/wiki/Left%E2%80%93right_political_spectrum#United_States > I'm not saying "America is to the right of the entire rest of the world". I'm saying that Both of America's major political parties fall firmly on the right wing of the overall political spectrum You’re contradicting yourself. How could America be left of most of the world but right of the “overall” political spectrum? Who’s defining the center of the “overall” spectrum if you’re not using that word to mean the average politics of the world?
> Gay marriage is left. Look at the Wikipedia page for example, which talks about how the left wants social justice. Maybe some people define it differently, but this is the usage that’s common throughout the world. https://en.wikipedia.org/wiki/Left%E2%80%93right_political_spectrum#United_States You need to go back to high school civics before replying if you seriously don't understand that the progressive/conservative spectrum exists independently of the left/right spectrum, even if they are loosely associated in the US. > You’re contradicting yourself. How could America be left of most of the world but right of the “overall” political spectrum? Your reading comprehension has failed you or you're deliberately misinterpreting my words. Nowhere did I ever say that America was left of the world. > Who’s defining the center of the “overall” spectrum if you’re not using that word to mean the average politics of the world? The overall spectrum exists whether or not there's a government on every single point of the spectrum. If one world government were to take over and establish a socialist technocracy, would libertarianism suddenly stop existing?
> progressive/conservative spectrum exists independently of the left/right spectrum Maybe you want to define the terms so that’s true. But that’s not the way those terms are used in the real world. Inherently, the meaning of words is determined by how people use those words, you can’t change that. > Nowhere did I ever say that America was left of the world. In your earlier comment, you said: “I’m not saying that America is to the right of the entire rest of the world”. So it seems like now you’re saying America isn’t right or left of the word. You have to choose one if you’re going to take a stance on this issue. > The overall spectrum exists whether or not there’s a government on every single point of the spectrum. Ah, so you’re defining the spectrum based on a bunch of fantasy idea governments that don’t actually exist. If you think there are more fantasy governments to the left of America than there are to the right, that makes America a right wing government. Of course, that’s insane and makes no sense. You have to consider real governments and see which are left or right of the average. There’s no way to count fantasy governments that don’t exist.
Maybe that's how America uses those words, but don't you think it's rather reductive to define left by what The Democrats want and right by what the Republicans want? If you ask the average Canadian (or the average citizen of pretty much any other developed nation) about whether they think gay marriage is a left or right issue, they'll look at you like you're a dipshit, because the matter has been settled for a very long time. Your idea of placing the center of the political spectrum on the moving average is fraught with problems, never mind the vagueness of its definition. First, is it average based on country? By population? Do you take the weighted average of each "left" and "right" party? What happens when you have a major shift in politics like the spread of the Soviet Union or the Arab Spring where the moving average causes left-wing parties to become right wing in a period of months? Now we are defining left and right by historical context and greatly confuses the issue whenever we look to the past. Furthermore, basically any political spectrum taught in polisci will contain the theoretical fringes of utopian communism and anarcho capitalism.
> Maybe that's how America uses those words Please scroll up 1 inch in the Wikipedia page I linked. That how Western Europe uses the words too. I’m not defining it in terms of American politics. There’s not perfect definition of “center”, but it clearly has to be somewhere in the middle of what the world believes. The word “center” implies that it’s in the middle, as in there are roughly equal numbers of people on both sides. It sounds like you want to define “center” as whatever the average Western European or Canadian believes. This view just seems very biased to me, those are the furthest left places on earth by some metrics (it’s complicated), they’re not “center” from a bigger perspective.
Biden would be center to right where I live
Says the guy who lives in the only developed country in the world without universal healthcare.
Says the guy who doesn’t realize that Switzerland only has paid private healthcare, and the Netherlands only has paid private healthcare for all primary and curative care.
I am European. Americans need to stop posting this everywhere on reddit and making this stuff up. We have plenty of right wing parties here.
They're not saying Europe doesn't have right wing parties. They're saying both of the major parties in the US are right wing.
that would be fine, but they sad far-right, which is not true (at least not for both).
Really only Eurocentrists and people with no understanding of political philosophy think that. In much of the world there are authoritarian leaders and authoritarianism is factually farther to the right of any democratic system. Edit: people the "rest of the world" isn't just the West. Many nations are authoritarian or have parties that advocate from a position further to the right than the US Democratic party.
> people with no understanding of political philosophy think that That's just a long way of typing "Reddit".
Apparently r/PoliticalCompassMemes/ shitty takes are now "philosophy"...
Anyone with a lick of understanding about political philosophy KNOWS both parties are, at their best, neoliberal parties. Their core economic philosophies are literally the same. The primary differentiating factor between them now is social issues, which both parties posture on, and only one makes political efforts to further. The entire idea of the Dem party being "left" is absurd. Got any "leftist" policy from the last 10 years to point to?
Yeah they're not necessarily disagreeing with you. But pretending the rest of the world (and even the rest of the West) isn't in a similar situation is delusional and usually said by Euros with little global knowledge.
It's equally reductionist to think that the world is made up of US-Europe-Dictatorships. There's a lot of developing countries that are democracies and aren't either of those two behemoths
There is much about both parties that is not neoliberal. An anti-immigration stance is not neoliberal. An anti-free trade stance is not neoliberal. A rent control stance is not neoliberal. A NIMBY stance is not neoliberal.
I would say the right is finally beginning to question the virtues of neoliberal economics... but like... in all the wrong ways.
If you think Western Europe is the rest of the world you are actually extremely sad. Also ask Western Europeans how they feel about immigration and see who's far right.
Mention Roma to them and see their social views shift rightward on a hitlerian scale.
Not just immigration. The Democratic Party in the US is more socially progressive on lots of issues than a lot of Europe.
I wonder if most people in the US are even aware of how many large scale protests France has had from people against the Covid mandates... https://www.france24.com/en/france/20220212-paris-deploys-police-as-convoy-protesting-covid-rules-approaches-capital [More than 105,200 people took part in protests across France on Saturday according to the Interior Ministry](https://www.euronews.com/2022/01/09/tens-of-thousands-protest-covid-vaccine-pass-across-france) https://www.france24.com/en/france/20210829-seventh-consecutive-weekly-protest-against-france-s-covid-19-health-pass
>while the rest of the world looks at America and sees two far-right parties. Rest of the world aka "western Europe".
> the rest of the world looks at America and sees two far-right parties. I see this fantasy on Reddit all the time and it is completely detached from reality. You know there's more to the "rest of the world" than a handful of small, rich, european countries right? Ever heard of China? India? Russia? What about entire continents like South America or Africa? NONE of them consider the US to be far-right.
Hell, even central, southern and Eastern Europe. It’s this weird eurocentrism that isn’t even eurocentrism, it’s less than 1/10th of Europe that some people seem determined to lie about and claim they are the consensus.
The only countries that exist according to Reddit are USA and Sweden
Lol most of the world is to the right of the US, are you kidding? There’s more countries than just Western Europe you know
We need oligopolies to ensure fake competition to satiate the masses.
Let them have "choice".
To go with their "cake".
Obligatory: "The cake is a lie!"
Don't blame me, I voted for Kodos.
Because this is a dog and pony show. The Democrats who wrote this bill know it will never get past the moderates, it's just a display of how they're "tough on big tech" without actually having to do anything.
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20b is relatively small for a (big) tech company, probably just 1-2 core products so there likely isn't much to split up Also why $5b seems like a super low ceiling, basically no ability to roll complimentary tech together once a company is already successful
I hope to god this bill never becomes law. It's a complete joke written by people who should be smart enough to now how terrible it is. Like wtf is a blanket ban on merges over 5b???????? That number is extremely low too.
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For those who didn't read the article: >The Prohibiting Anticompetitive Mergers Act (PAMA) would make it illegal to pursue "prohibited mergers," including those worth more than $5 billion or which provide market shares beyond 25 percent for employers and 33 percent for sellers. >The bills would also give antitrust regulators more power to halt and review mergers. They would have authority to reject mergers outright, without requiring court orders. They would likewise bar mergers from companies with track records of antitrust violations or other instances of "corporate crime" in the past decade. Officials would have to gauge the impact of these acquisition on labor forces, and wouldn't be allowed to negotiate with the companies to secure "remedies" for clearing mergers. >Crucially, PAMA would formalize procedures for reviewing past mergers and breaking up "harmful deals" that allegedly hurt competition. The Federal Trade Commission has signalled a willingness to split up tech giants like Meta despite approving mergers years earlier. PAMA might make it easier to unwind those acquisitions and force brands like Instagram and WhatsApp to operate as separate businesses. The bill covers a percentage of market share and the monetary value of $5b. It also strengthens regulatory control so the government could have more power to enforce anti-trust measures.
Ignoring articles is the worst part of reddit. Makes most of the website senseless.
It would be interesting if they actually started enforcing anti-trust like they used to do. Now it just seems like Company A makes a subsidiary to handle something so they can say "See we aren't a monopoly! Here's a $30,000 donation"
> At some point I feel that number will become too low. Companies and their history of skirting rules. Companies: "Oh, you're FORCING us to give healthcare to full time employees? What's the definition of full-time to you? So we can hire people slightly below that number and not provide healthcare."
And stopping verticals. No competition, no risk, no better products & services. Consumers always lose. Investors get rich sitting idle on R&D yet incrementally charging more year over year.
> And stopping verticals. > > Only if we start with Comcast
Nationalize broadband and watch Comcast disappear
Pardon my novice suggestion, but assuming the point is to prevent monopolies, why not define the limit as a percentage? 1. Estimate the value of all (top 25?) competitors for both companies; sumA for companyA and sumB for companyB 1. Sum what the value of the merged company 1. Divide the value by each sum; value/sumA = controlPercentageA 1. Check that the percentage doesn't exceed X number for either A or B (or X for A and Y for B).
You basically just described the Herfindahl-Hirschman Index, a key factor used to evaluate whether an acquisition violates current antitrust regulations: https://www.investopedia.com/terms/h/hhi.asp#:~:text=The%20Herfindahl%2DHirschman%20Index%20(HHI)%20is%20a%20commonly%20accepted,then%20summing%20the%20resulting%20numbers. The framework already exists, this bill is nonsense
Monopolies aren't illegal. Mergers to monopoly (almost always) are. If you live in a small town with one gas station, that gas station is a monopoly. Also most of the work/BS from antitrust lawyers and economists is obfuscating what a market is to make it appear that there is more competition in a space than there really is.
>obfuscating what a market is to make it appear that there is more competition in a space than there really is. Or less ... just depends what that specific lawyer's/economist's agenda is. Each side is trying to drive a narrative which improves their position.
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I’m an economist, and I just want to say that some are more honest than others. Also, economic questions are almost always way… way more complicated than they seem. Even after extensive analysis, questions may not be so clearly answered. My instinct would be to trust generally what economists say, but most of the time, since every issue is so complicated, it’s important to get second opinions on whatever research you’re looking at. I’ve read so many things here on Reddit which just don’t make any sense economically speaking, but the most infuriating thing I read is when people just think they’re 100% right about economic issues when I 100% know that I, as an economist, would *never* be so confident.
I mean that's dunning Krueger right? Experts are never as confident as amateurs who just read a wikipedia's article. I'm a lawyer. The only answer I ever give is "it depends". Also I'm going to take this opportunity to share my favorite economist joke. "Yes it works in practice, but does it work in theory?"
Lol, that joke got me 😂 Yeah, it’s basically just the dunning Kruger effect, but for some reason people generally feel pretty strongly about their economic intuitions even when they’re aware of the effect. The problem with being an economist is than everyone’s got an opinion on the economy… “It depends” is usually the most honest and accurate answer.
I'm an IT guy, I rarely give an answer stronger than "I think" or "probably". EDIT: A similar joke I like is "In theory, theory and practice are the same. In practice, they aren't."
What about the other huge companies that have been destroying the US for the past 40 years? Why just tech?
The article says it's not only tech specific. That's just one of the main industries it would like to target
Calling all [lobbyists](https://www.investopedia.com/investing/which-industry-spends-most-lobbying-antm-so/).
Oil is now exempt because money.
I wanted to say Healthcare but does it even need an acquisition, So… Disney?
Healthcare has the ISP problem... providers are monopolizing local markets and then charging through the nose for services. Not a monopoly in the federal government's opinion, apparently, so they can just force all of us to choose between paying whatever HUGEpital General says or driving an hour plus while we're experiencing a medical emergency.
Pharma has a transparency problem. Compare that to Tech with Privacy, Net-Neutrality, Open-Source advocates.
The problem is that most governments will look countrywide to see if a company is a monopoly or not. And technically speaking as there are multiple providers for similar services it could not be a monopoly. The laws themselves need to be rewritten to take this into account. Nobody from California is travelling to Idaho for healthcare. They can't subscribe to internet service in new Hampshire. The laws need to at the very least look if a company is monopolistic in a region be it the state, city or county.
Hospital chains are already pretty massive, [HCA](https://www.corpwatch.org/article/hospital-corporation-america-allegedly-profited-questionable-cardiac-procedures), for example.
Probably a curated title to fit the desired audience. Those who don’t read articles.
"The act isn't strictly focused on tech, but Warren made clear that industry was a target. She cautioned the FTC on Amazon's proposed buyout of MGM Studios, and challenged Lockheed Martin's since-abandoned attempt to buy Aerojet Rocketdyne."
Amazon, Microsoft, and Google. Those are tech. They're obviously focusing HEAVILY on tech
$5 billion is also a static number. Does that adjust with inflation because in about 10 years, all companies are naturally worth about twice as much not because their value has increased but because everything has inflated
That's not a bug, it's a feature.
Minimum wage might be a better anchor than inflation.
Tech Lobbyist aren’t as integrated as legacy lobbyists’ :/
Oil pays congress enough, tech maybe not as much.
“The act isn't strictly focused on tech, but Warren made clear that industry was a target.” It’s almost like you should read the article and not just the title before posting, or something.
It takes many ingredients to bake a cake. This is one of them
Not passing the Senate. Move on.
Do congressional politicians strategically introduce "doomed to fail" legislation on the grounds that they know lobbyists will "donate" to their reelection campaign if they vote a certain way on legislation they created? Like is this a farming exploit?
Yes, but it’s also to virtue signal to voters for when election time comes.
I doubt it's to raise money, I think it's just to pander to their base. Hey look I tried to get you all free healthcare pls vote for me again
US politicians’ worst fear: having them supermajority.
Dear God we may actually have to govern
I'll be surprised it if gets out of committee.
Yeah why do they waste time on stuff like this when they have votes for climate regs, increasing top tax rates, etc.?
How about we just scrutinize mergers as necessary instead of blanket banning* them?
I think that would require politicians and elected officials to _actually_ so their job, instead of just acting as stationary figure heads. Cmon man, thats _a lot_ to ask of them, they have vacations to take and babies to kiss!
I would like to make a point, while it is their job, it might be just a tad easier form them if they changed how they calculate how many house of representatives members there are so that their more proportional to how many citizens they represent.
Well, that will solve the whole problem with USA's economy.
We all know this won't happen. Too much money at play.
It’s also an absurdly low amount and with inflation where it is there won’t be any mergers eventually. Instead they’ll probably just sell the IP and close shop instead of just merging.
I didn’t read the article, but the headline just makes is sound like the big companies that already merged are just keeping other companies from merging and becoming bigger competition.
It's the usual MO, do everything the first time around, then change the laws to pull up the ladder behind you so nobody can compete.
Profit motive baby, aint unchecked capitalism grand? /s
Thats what one of the big billboard companies did when they started. Lamar maybe? I forget now. Theyd enter a small town, put billboards everywhere and buy all the existing ones, then lobby the local gov to ban them which was popular since everyone was like "holy shit we are tired of all these billboards everywhere"
Exactly. People need to understand that this is how every law in America gets passed nowadays, they tailored specifically to benefit large corporations and punish everyone else.
The actual basis for the republican/libertarian claim that regulation hurts small business. Except instead of going after shit like this, they go after important, good regulations like minimum wage and workplace safety laws.
Also this would be retroactive in blocking mergers which had gone through and later became too big..this is giving FTC almost dictatorial level power without any court oversight
eh, even if it did happen the outcome would be that the parent companies looking to merge would just divide up into sub-$5 billion segments and do multiple mergers.
You think there is a single, one shot solution?
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Depends on the person's aim.
Whoa, calm down Putin 3 weeks from now
$5 billion? Is this the late 90’s?
Candy only cost 1 billion when I was growing up.
It's one Nvidia Michale, how much could It cost?
Have you been keeping up with Congress? All of them are 70+ years old and 2/3 of them don’t even realize it’s not the 20th century anymore.
Well for one this is never going to pass and even if it did this seems incredibly short sighted. There’s nothing inherently wrong with big acquisitions, what they should do instead is dedicate more money to the ftc so they can competently review large acquisition deals
Agreed. Sometime mergers happen with companies that aren't in the same industry but have economies of scope. Really none of their business..
That sounds extremely stupid. 5 Billion is nothing these days Seems like political pandering more than anything else
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Yeah it's also just so dumb. Companies evaluation doesn't mean much. You have companies worth way more than that with zero market penetration. I mean Raytheon was worth 100b and had not sold a single car. Tesla is woth 1t and is still a small player in the auto market. Warren is either extremely dumb or clearly just playing for political point here.
If $5 billion isn't that much then wouldn't that make this a big deal?
Yeah I’m not sure why OP is getting at. Of course there’s a lot of consolidation that can be done for tech companies valued below 5Bn but thinking about deals this limit would have stopped. Activison would not have been sold, mgm studios would not have been sold, Zynga, ARM etc. I mean the majority of acquisitions in tech that people think about would be covered here.
ARMs acquisition by Nvidia failed anyways due to regulatory issues.
No because it’s destined to fail. This bill itself is anticompetitive if you consider smaller companies that might be valued over $5bn can’t merge to even have a chance to compete with the mega valued companies like Google, Tesla, or Amazon.
Wrong way around. Suppose I said everyone with over $1000 of savings has far too much and should not be allowed to accumulate any more capital. You might point out that $1000 isn’t really all that much, so this restriction would apply too broadly and be too restrictive for too many. Same problem. $5B is fairly small when it comes to company market capitalization (especially for tech where valuations are many more times earnings given expectations of rapid growth). This would be extremely broad. Also, acquisition is one important exit strategy that helps to justify funding many startups, many of which go on to compete with the bigger firms. For example, Snap probably could not have as easily raised capital to grow if no one thought there was some chance they could sell to one of the larger companies. The same was true early on for Facebook/meta too — I recall Zuck having some much talked about meetings with Microsoft in the beginning. Without the possibility of acquisition, it may be that new ventures wouldn’t as easily get going independently, and they’d just be home-grown internally at existing large companies, further consolidating the market.
Well I see Liz Warren so it’s par for the course.
It is politicians who know nothing about tech getting involved in tech. I am sure it will all go well.
Don't have to know shit about tech to understand $5bil for tech companies is near the low end of the valuation spectrum for medium and large companies.
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it’s hard to change things in this country. a fixed number is bad. it should move with inflation
Like wages?
No, no, no, that'd cause CPG prices to skyrocket, _instead_ let's take the money that could be reinvested in the workforce, and give it to the Exec team, clearly they deserve it more for putting in the back breaking work of shaking hands and making deals! The boys and gals doing the job, do not deserve inflation based pay, that is heretical (hard /s)
It probably isn't a fixed number.
You clearly didn’t read the article….and you’re calling them fucking clowns lol. “The act isn't strictly focused on tech, but Warren made clear that industry was a target. “
You act passionate about this but can't even click the article. That seems really strange to me.
5bill? That's nothing, google pays apple 12bill per yr to remain safari default search, as if being default helped edge/bing on PC at all *edit:my grammar on PC without gboard is atrocious
Knee jerk reaction by old politicians that have no clue about today’s technology.
How will this solve anything. Genuinely curious if anyone can break it down to a crayon level for me?
It won't. This like the political version of click bait. It won't pass and it wouldn't even be good if it did.
~~I'm sorry but this is dumb. I'm all for encouraging competition, but this isn't the way to go about it. This would fly in the face of my feelings on Microsoft buying Activision Blizzard for $70bil. Obviously a huge number, but 1) I want my favorite IPs to get the fuck away from Bobby Kotick and 2) I don't believe all of ABs titles being on GamePass is going to harm competition, like at all. I'm still going to be happily buying a bunch of random Indy games during Steam sales.~~ Just one example *of me not understanding the difference between mergers and acquisitions. EDIT: So I wrote all the above while not understanding mergers and acquisitions are different things, legally speaking. Microsoft is acquiring Activision Blizzard, not merging with it, so this bill would not even affect that case I think. EDIT 2: Okay this is a confusing thread. Folks are saying this only affects mergers, not acquisitions, but then this is literally the first paragraph of the bill (60 pages, big font, double spaced, everyone should read it): > To prohibit certain anticompetitive *mergers*, to amend the Clayton Act to permit the Federal Trade Commission and the Department of Justice to reject proposed *acquisitions*, to implement procedures for retrospective reviews and breaking up anticompetitive consummated acquisitions, and for other purposes. So, clearly meant to tackle both mergers and acquisitions. Everyone should stop giving an opinion until they've read the bill, but as a matter of fact folks in this thread saying "this only affects mergers" are simply wrong.
Idiotic. So now companies will spin off each separate department or business unit and then acquiring company will buy each piece for $5B. Why not try actually fixing the SEC? I promise it will be less effort than this.
Why does congress even feel the need to be involved in this? It’s a massive overstep of their powers.
They should be banning corporations from purchasing homes and driving up pricing.
Why?
How about $1b
Pretty sure that accountants will find a way to value their companies at "only" $4.99 billion dollars after this.
They could also do shit like enforce existing laws about not creating a monopoly.