Lina Khan's FTC Confirmation: A Refreshing Approach to Tech

The Surprisingly Smooth Confirmation Hearing for Lina Khan

Predicting the outcome of a confirmation hearing in the current political climate is often difficult, particularly for a nominee who challenges established norms and powerful corporate interests. However, Lina Khan, nominated to be an FTC Commissioner, experienced a remarkably positive session before the Senate Commerce Committee today. This may be due to the increasing political appeal of her unconventional antitrust perspectives.

Khan's Background and Key Ideas

Currently an associate professor of law at Columbia University, Khan is widely recognized within the technology sector for her influential essay, “Amazon’s Antitrust Paradox.” This work critically examined the shortcomings of existing regulatory frameworks that have enabled Amazon’s continued expansion across numerous markets. She also contributed to a recent House report focused on technology policy.

When initially published in 2018, the perception that Amazon was misusing its market power, while present in some circles, wasn’t broadly accepted within the Capitol. However, a growing consensus that insufficient regulation has allowed companies like Amazon, Google, and Facebook to become overly dominant has fostered a rare bipartisan desire to address these issues.

A Collaborative Hearing

The confirmation hearing, which also included nominees Bill Nelson for NASA leadership and Leslie Kiernan for the Commerce Department’s general counsel position, was characterized by a sense of shared purpose. The three-hour session unfolded as a constructive dialogue.

Khan represents a shift in the Biden administration’s approach to regulating Big Tech and other businesses perceived as having exceeded appropriate boundaries. Senators from both parties posed questions that elicited thoughtful and confident responses from the nominee.

She skillfully navigated attempts to provoke her – including a misdirected question regarding Section 230 – and consistently emphasized the need for the FTC to be better informed and more proactive in overseeing these influential corporations.

Key Positions Expressed by Khan

Here are excerpts from the hearing, reflecting her stances on several critical issues (answers have been lightly edited for clarity):

On the FTC’s Role in Disputes Between Tech Giants and News Organizations

“A comprehensive approach is necessary. The crisis facing local journalism is evident, and the current situation has highlighted the democratic consequences of lacking reliable local news sources.”

Khan also pointed to the increasing concentration within advertising markets and the potential for arbitrary algorithm changes to significantly impact entire industries.

Image Credits: Graeme Jennings/Washington Examiner/Bloomberg / Getty Images

Regarding Clarence Thomas’s Proposal to Treat Social Media as “Common Carriers”

“The suggestion sparked a valuable discussion,” she stated diplomatically. “In my analysis of Amazon, I identified two potential regulatory paths. One involves rigorously enforcing competition laws to ensure competitive markets.”

“The other considers the possibility that certain economies of scale and network effects may lead to sustained dominance by a few companies. In such cases, a different set of rules may be required, drawing on our legal tradition of applying checks to concentrated markets, with common carriage being one such tool.”

“It’s important to note that these firms operate across numerous markets, and the appropriate regulatory tools may vary depending on the specific market in question.”

(This was a nuanced way of suggesting that both common carriage and existing antitrust laws may be inadequate for the task.)

On Re-evaluating Previously Approved Mergers

“The FTC’s resources haven’t kept pace with the growth of the economy and the increasing size and complexity of the deals it reviews.”

“There was an assumption that digital markets move quickly, negating concerns about concentration due to potential new competition. However, we now recognize that significant network effects create market stickiness. In retrospect, some of those merger reviews represent missed opportunities.”

(Senator Blackburn (R-TN) expressed concern about Khan’s “lack of experience” before questioning her about a spectrum plan – a matter under the purview of the FCC, not the FTC.)

On the Challenges of Enforcing Orders Against Companies Like Facebook

“A significant challenge is the information asymmetry between these firms and enforcement agencies. It’s clear that agencies have sometimes been slow to fully understand the underlying business and empirical realities of these markets. Ensuring agencies can keep pace is crucial.”

“The use of proprietary, ‘black box’ algorithms in social media can obscure what is actually happening. The FTC must leverage its information-gathering capabilities to address these gaps.”

On Protecting Children and Vulnerable Groups Online

“These dangers are amplified by the increased reliance on online technologies, particularly during the pandemic. Existing rules should serve as a baseline, not a limit.”

The hearing was marked by minimal partisan conflict and a widespread sense that Khan, while perhaps not possessing extensive direct experience in the role, was a highly qualified nominee. Her well-considered and assertive positions on antitrust and competition could potentially put Amazon and Google on the defensive.