Economics: The War Against Business - The Google Antitrust Ruling Explained

 

(Drivebycuriosity) - There is a war against business. The Biden administration is punishing any corporation which is successful, big & popular.

This week an US court decided against Google in an antitrust law suit filed by the U.S. Department of Justice. Judge Amit Mehta, an appointee of Obama, claims that "Google is a monopolist, and it has acted as one to maintain its monopoly." ( entrepreneur). The DOJ Google lawsuit is joined by unsuccessful competitors, including search engine provider DuckDuckGo, Bing (owned by Microsoft) and by service-recommendation site Yelp (searchengineland ).

The decision is not surprising and can be explained by economics (driveby ):

"1. The judge supports competitors of a successful firm that want to harm their rivals or appropriate parts of their businesses; 

2. The judge sides with firms disadvantaged by technological change that seek to mitigate market outcomes unfavorable to them; 

3. Economist also refer to personal ambitions of government administrators who can make "a name" with huge verdicts

4. The legal profession (trial lawyers) earns huge sums of money.

Economists call this "Rent Seeking".

Judge Mehta´s decision and the monopoly claims are unfounded. Google`s market position is already challenged by a growing number of AI services like Perplexity AI. I use still Google search & maps very frequently because they are free and the alternatives are inferior. Google cannot force me or others to uses their services. The corporation reached her dominant market position by being the best search engine and provider of internet maps.

Google - and other Big Tech corporations - want to make profits, as all entrepreneurs do, and they are successful. Profit seeking is the engine of America´s success. Google & Co. are investing ever-increasing amounts on research and development to innovate new products and stay competitive.

But the government tries to stop that. Judge Mehta´s  verdict is fundamentally anti-business, if not anti-capitalist. It reminds me of China´s leader Xi Jinping, who has curtailed successful corporations like Alibaba, Tencent & Baidu, because he does not accept other gods beside him and he wants to bring them even more under the yoke of the government.