FTC Chair Says Antitrust Enforcement May Keep US Tech Ahead Of China

FTC Chair Lina Khan stated during an interview on CNBC’s “Squawk Box” that enforcing antitrust measures could be advantageous for the US to maintain a lead in developing advanced technologies compared to China.

The tech industry has cited China’s potential for catching up to US technologies to argue against more aggressive enforcement. Following the FTC’s proposal to bar Meta from monetizing kids’ data for allegedly violating a privacy agreement, a spokesperson for the company tweeted about the FTC’s attempt to “single out one American company while allowing Chinese companies, like Tik Tok, to operate without constraint on American soil.” The FTC also has a privacy agreement from 2019 with TikTok for alleged violations.

On Wednesday, Khan stated that historical evidence indicates that stricter enforcement within the United States would have a positive effect on the country’s position in global affairs.

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“What history and experience have shown us is what best positions the United States to compete internationally, to stay ahead internationally, is making sure that we are a home for innovation,” Khan said in an interview with CNBC’s Andrew Ross Sorkin. “And what best produces breakthrough innovations, cutting edge technologies, is competition. I think we’ve seen time and time again monopolies and incumbent firms arguing that they need to preserve their monopoly to make sure that the U.S. stays ahead. But historically the US has instead enforced competition laws, enforced antitrust and that is what has led us to be the home of cutting-edge technologies.”

Khan provided two examples of antitrust cases in the tech industry from the past century, IBM and AT&T. Regarding the case of AT&T, Khan pointed out that the government’s mandate for the telecommunications company to reveal its patents resulted in numerous innovations over many years.

“I think we saw that Silicon Valley was birthed in the wake of strong competition and antitrust enforcement,” Khan added. “And so I think we need to be very wary of arguments that it’s really monopoly that’s going to best position us to thrive internationally when time and time again we’ve seen the exact opposite.”