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S. 1074 (117th): Trust-Busting for the Twenty-First Century Act


The bill would disallow many mergers, despite having two hyphenated terms in a single bill title.

Context

Republicans have historically taken a more laissez-faire approach to business and economic matters than Democrats. But in more recent years, several of the most prominent Republicans have taken an approach alternatively described as “economic nationalism” or “economic populism,”

Spearheaded by Donald Trump but also including acolytes like Sens. Marco Rubio (R-FL) and Josh Hawley (R-MO), the ideology seeks to put the government’s thumb on the scale of business to serve conservative policy ends. In the past year, GovTrack Insider has covered several bills to this effect, including:

Sen. Hawley frequently opposes what he and others on the right term “woke” corporations, large companies which they believe exhibit left-wing bias, decisions, donations, or policies. Among the most frequent targets of their ire include Disney, Alphabet (the parent company of Google), Amazon, Apple, and Meta (the parent company of Facebook).

What the bill does

The Trust-Busting for the Twenty-First Century Act is Sen. Hawley’s bill which would implement several policy changes against America’s largest corporations, notably banning any merger or acquisition by a company worth $100 billion or more.

Approximately 70 companies currently meet that threshold, including such household names as the five aforementioned companies, plus the likes of Microsoft, Tesla, Johnson & Johnson, Visa, MasterCard, Home Depot, Pfizer, Coca-Cola, Pepsico, McDonald’s, Verizon, Nike, Comcast, Lowe’s, AT&T, PayPal, Netflix, American Express, Starbucks, and Goldman Sachs.

The bill would also include several other measures meant to lessen the influence of America’s largest companies, including lowering the thresholds for evidence when the federal government pursues antitrust lawsuits, and increasing the financial penalties when companies lose those same antitrust lawsuits.

It was Introduced in the Senate on April 12, 2021 as S. 1074.

What supporters say

Supporters argue that the most massive corporations have become too big, using their influence to dictate more aspects of Americans’ lives than they may even realize.

“A small group of woke mega-corporations control the products Americans can buy, the information Americans can receive, and the speech Americans can engage in,” Sen. Hawley said in a press release. “These monopoly powers control our speech, our economy, our country, and their control has only grown because Washington has aided and abetted their quest for endless power.”

“While Big Tech, Big Banks, Big Telecom, and Big Pharma gobbled up more companies and more market share, they gobbled up our freedom and competition, American consumers and workers have paid the price,” Sen. Hawley continued. “Woke corporations want to run this country and Washington is happy to let them. It’s time to bust up them up and restore competition.”

What opponents say

Opponents counter that the bill is a solution in search of a problem, because the existing economic and political landscape which allowed the rise and continued success of Sen. Hawley’s most despised companies is not rigged as it is.

“In the case of Big Tech, governments have not restricted competition,” the American Enterprise Institute’s Nonresident Senior Fellow Mark Jamison wrote in an opinion column criticizing the bill. “As a result, there is an abundance of companies providing search services in competition with Google, providing e-commerce in competition with Amazon, operating social media platforms in competition with Facebook and Twitter, providing advertising in competition with all four companies, and building devices in competition with Apple.”

“Big Tech companies are big because consumers and advertisers around the world choose their services and investors provide the capital needed to deliver consumers and advertisers what they want,” Jamison continued. “This is nothing more than free markets finding spaces where investors and consumers both benefit. No one group is in control. Laws restricting these markets harm the people whom Big Tech serves.”

Odds of passage

In theory, this sounds like a bill which some of the most progressive Senate Democrats such as Sens. Cory Booker (D-NJ), Bernie Sanders (I-VT), or Elizabeth Warren (D-MA) could also support. In reality, it has not yet attracted a single cosponsor.

The most likely explanation is that the bill commands few ideological supporters on the Republican side, while Sen. Hawley is too toxic a political figure to associate with on the Democratic side. Notably, Hawley was the first senator who publicly pledged to challenge the 2020 Electoral College results which elected Joe Biden as president.

The bill awaits a potential vote in the Senate Judiciary Committee.

Last updated Oct 25, 2022. View all GovTrack summaries.

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress, and was published on Aug 2, 2022.


Trust-Busting for the Twenty-First Century Act

This bill makes various changes to the federal antitrust statutes and places restrictions on acquisitions involving certain dominant digital firms.

First, the bill revises the evidentiary standards for establishing an illegal monopoly. Under the bill, if a plaintiff establishes the existence of substantial market power or the detrimental effects of particular practices, then the plaintiff need not further establish the scope of the relevant market or the share of the market controlled by the defendant. Further, to prove that the procompetitive effects justify a defendant's conduct the defendant must show by clear and convincing evidence that (1) the procompetitive effects of the conduct outweigh the anticompetitive effects, and (2) the defendant could not obtain substantially similar procompetitive effects through commercially reasonable alternatives. In the case of a violation, courts must order the disgorgement of all profits earned as a result of the conduct.

Next, the bill generally prohibits acquisitions by companies with a market capitalization exceeding $100 billion where the effect of the acquisition may be to lessen competition.

Finally, the Federal Trade Commission may designate as a dominant digital firm a website or online service that the commission determines possesses dominant market power based on specified factors. Acquisitions by such firms in excess of $1 million are presumed unfair trade practices under the bill. Further, a dominant digital firm that provides search functionality must disclose to users any search results are that are promoted or demoted based on whether the search result is affiliated or not affiliated with the firm.