Viral Incentives: Technoauthoritarians Thrive on Your Fear

by Amy Peikoff and Jeffrey Wernick*

Last month the House Judiciary subcommittee on antitrust heard testimony from the CEOs of four companies on whom we’ve all become more dependent lately: Amazon, Apple, Facebook and Google. The irony of doing this in the midst of ongoing lockdowns was not lost on a friend who wrote, “Statist chutzpah reaches another low when the legislature that wants you to stay home grills Bezos, the man making this possible.”

Whatever your opinion of Bezos and the others, there is something more ironic, still, considering the purpose of the grillfest: to examine the “dominance” of these companies. Committee Chairman Jerrold Nadler compared their role—their services, he said, were “one way or another” effectively required in order to use the Internet today—to that of railroad companies in the 19^th century:

By virtue of controlling essential infrastructure, these companies have the ability to control access to markets. In some basic ways, the problem is not unlike what we faced 130 years ago, when railroads transformed American life—both enabling farmers and producers to access new markets, but also creating a key chokehold that the railroad monopolies could exploit.

And so, just as the railroads were powerful monopolies that must be forcibly broken up, so presumably must these four. Upon hearing this, any good capitalist can immediately identify an important disanalogy: the railroads were government-created monopolies. Four of the five transcontinental railroads were built with government assistance. Not so for Amazon, Apple, Facebook or Google, right?

So far as we know, none of these companies were given substantial direct assistance as the railroads were—land grants totaling about 180 million acres. But each has benefited substantially from government intervention—Amazon from the ability to ship cheaply via the government monopoly otherwise known as the USPS; the others from a bright-line framework for avoiding legal liability for content, established in 1996 under section 230.

Moreover, this year, these companies have benefited tremendously from the widespread, government-mandated lockdowns. And the lockdowns themselves might not have been thought necessary but for government mishandling of the Coronavirus crisis—on top of decades of government intervention in both medicine and nutrition science.

While just about every business deemed “non-essential” struggled during the last quarter—GDP plunged 32 percent—Amazon’s sales soared 40 percent while its profits more than doubled. Facebook’s profit jumped 98 percent and growth exceeded forecasts, with a 40-percent surge in total impressions. Apple increased sales and posted $11 billion in profits. Google’s performance was the weakest of the four, but still beat market expectations: its share price increased 70 percent since March. 

In short, people stuck at home means people spending more time with their eyes glued to screens, looking for information, entertainment, goods and services online. Government-mandated lockdowns, made necessary by the effects of earlier government interventions in the setting of a global pandemic, have made the problem of competition in the tech industry even worse than it already was. They have allowed these four companies to become even more dominant than before in their respective markets.

And now, even if not intentionally, three of the companies (Amazon (Washington Post), Facebook and Google)—along with Twitter, whose CEO was conspicuously absent last month—are curating the flow of information about all things Coronavirus, in accordance with the advice of the CDC and the WHO. Maybe these companies like the effect of the lockdowns on their bottom line? Perhaps they want to placate the governments threatening to break them up? Or maybe policymakers in these companies truly believe it’s their ethical duty to remove, e.g., all content purporting to offer an unapproved cure for the Coronavirus? 

While we may never know their true motives, we do know some of the consequences we may expect: people staying home longer means these and other “essential” businesses will become more dominant, wealthier, while the rest of the economy continues to suffer. This may lead to calls for even more government intervention—including forcible breakup or regulation of tech companies. Maybe both? Perhaps just enough intervention to give government a long-sought-after “backdoor” to our data, to really complete the Orwellian picture. 

Even if these companies’ content-moderation policies are earnestly intended to decimate the conspiracy-style thinking that is increasingly prevalent online today, they can only make matters worse. Hell hath no fury like individualists confronted by technoauthoritarians who try to do their thinking for them. Unfortunately, many justifiably angry users will be eager to support a “solution” involving yet another layer of government intervention.

What are staunchly independent, profoundly dissatisfied individuals to do? Embrace a privacy-conscious platform which provides users with a free and open Public Square. One that doesn’t try to do their thinking for them; one where they will be invited to consider both sides of every argument and decide for themselves. May we suggest Parler?

*I recently joined Parler as Chief Policy Officer; Jeffrey Wernick is a Parler Strategic Investor and Chief Operating Officer.