GiD Report#168 — The plan to boost American competition

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GlobaliD

4 min readJul 13, 2021

Welcome to The GiD Report, a weekly newsletter that covers GlobaliD team and partner news, market perspectives, and industry analysis. You can check out last week’s report here.

ICYMI — latest episode of the podcast w/Vadim: EPISODE 09 — Understanding GlobaliD’s identity platform

This week:

Biden takes on anticompetitive America
By many measures, America is badly in need of competition
A bunch of those initiatives are aimed at Big Tech
Chart of the week
“The collapse of American identity/democracy”
Stuff happens

1. Biden takes on an anticompetitive America

President Biden signed an executive order last Friday promoting 72 initiatives designed to boost competition:

The Information:

The move is months in the making, and has been spearheaded by Tim Wu, an outspoken critic of the power of large technology companies, who Biden named earlier this year as a technology and competition adviser on the National Economic Council, a key policy group in the White House.

2. By many measures, America is badly in need of competition

According to the NYtimes’ David Leonhardt, a boost in competition is badly needed:

The U.S. economy has been less dynamic in the 21st century, by many measures, than it was in the late 20th century.
Fewer new businesses are starting. Existing businesses have slowed the pace at which they hire new workers (as the chart here shows). Workers are less likely to switch jobs or move to a new city. Companies are investing in new buildings and equipment at a lower rate. And small businesses make up a shrinking share of the economy.
Together, these trends suggest that the economy suffers from a lack of fair competition, many economists believe. Large corporations are often able to increase profits not by providing better products than their rivals but instead by being so big that they exercise power over workers and consumers. The government also plays a role, through policies that protect existing companies at the expense of start-ups and new entrants into an industry.
…
The lack of competitive dynamism plays a role in many of the U.S. economy’s biggest problems: the disappointing economic growth of the past two decades; the declining share of output going to workers; and rising income inequality. It also helps explain the new concern — among both Republicans (like Josh Hawley and Ken Buck) and Democrats (like Elizabeth Warren and Amy Klobuchar) — about the power of big business.

3. A bunch of those initiatives are aimed at Big Tech

Some relevant bits from the Fact Sheet:

Announces an Administration policy of greater scrutiny of mergers, especially by dominant internet platforms, with particular attention to the acquisition of nascent competitors, serial mergers, the accumulation of data, competition by “free” products, and the effect on user privacy.
Encourages the FTC to establish rules on surveillance and the accumulation of data.
Encourages the FTC to establish rules barring unfair methods of competition on internet marketplaces.

Also, we talk a lot about data portability and being able to easily switch platforms and providers. The Biden administration wants to apply that to banking as well:

Encourages the Consumer Financial Protection Bureau (CFPB) to issue rules allowing customers to download their banking data and take it with them.

4. Chart of the week

5. “The collapse of American identity/democracy”

On the topic of America needing a bit of a boost, here’s a great interview w/the New Yorker’s George Packer and his new book about a divided America (via /gregkidd):

In his new book, “Last Best Hope: America in Crisis and Renewal,” George Packer writes that the United States is in a state of disrepair, brought about primarily by the fact that “inequality undermined the common faith that Americans need to create a successful multi-everything democracy.” The book opens with an essay on the state of the U.S. during the pandemic, and then offers sketches of four different visions of the country: Free America, of Reaganism; Smart America, of Silicon Valley and other professional élites; Real America, of Trumpist reaction; and Just America, of a new generation of leftists. “I don’t much want to live in the republic of any of them,” Packer writes. He proposes a different vision, which he thinks offers brighter possibilities, centered around the concept of equality and non-demagogic appeals to patriotism.