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Washington Examiner
Restoring America
15 Sep 2023


NextImg:The government's weak antitrust case against Google

Earlier this week, an antitrust trial against Google got underway. The Justice Department argues Google’s search engine is an illegal monopoly. It says Google’s multibillion-dollar-a-year payments to Apple and others to ensure that Google search is the default on their products are illegal. The Justice Department says this situation creates a monopoly feedback loop.

The government's case is fundamentally flawed. First, the foundational principle of United States antitrust law is consumer welfare, and a corollary principle is economic efficiency. Instructively, it's also notable that this case was launched against the recommendation of career Justice Department lawyers.

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Top line: Google search is free to the consumer. How can the consumer be harmed if Google search is free? Under U.S. antitrust law, it is not germane that smaller competitors are harmed by Google’s near monopoly position in search. U.S. antitrust law is not about helping small companies compete against larger companies. That is an important point because the evidence indicates that Google search is a better product. Microsoft embeds its Bing search function in its Windows software, but consumers prefer to use Google and select the Google search application to use with Windows software.

As for the payments that Google makes to Apple and others, that, too, is legal. The Google payments are similar to the payments branded product companies such as Coca-Cola, PepsiCo, and Procter & Gamble make to supermarkets to ensure their products are prominently and effectively displayed. The Federal Trade Commission has investigated the payment arrangements by branded product companies to supermarkets and found no harm to consumers.

The Justice Department also says that Google determines the order of services and products when a consumer uses the Google search function. The Justice Department says Google prefers its services and products in the search display. Google highlights Google. The Justice Department says that this is evidence of illegal monopolization.

That accusation is nonsense. To use the supermarket analogy again, a supermarket can display its store brands as it chooses. It can highlight its own brands. After all, it is the owner. It would be an unconstitutional taking of property for the government to have the power to decide how products are displayed in a private store. Google is the store. The government does not have the power to decide the order of displays. Government can only order that Google change its search displays if the consumer is harmed. But again, Google search is free. Thus, no harm. Bare knuckles competition is legal under U.S. antitrust law.

If the Justice Department prevails on certain grounds, what penalties will be meted out?

Google will not be broken up, but if it were, market participants believe that the sum of the parts would be worth more than the current whole. If Google could no longer make payments to Apple and others, so what? Google would save money and consumers would continue to prefer Google search, as is the case for Windows users. Consumers are reticent to change consumption habits.

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Will the administrative state tell us what search function to use? No. The Biden administration and liberals fear big business but waltz at the intersection of big unions and big government . But shouldn’t people be free to decide what products and services to use and consume?

Liberty is central to the Constitution and the nation.