FTC Chair Lina Khan has a chance to serve on Big Tech’s to-do list, nearly a year into her tenure, and now that she has a Democratic majority on hand.
News leadership: The Senate voted 51-50 Wednesday afternoon — with Vice President Kamala Harris breaking the tie — to confirm privacy expert Alvaro Bedoya to the Federal Trade Commission.
The Big Picture: Progressives last year welcomed President Biden’s appointment of Khan, a prominent critic of Amazon’s market power, to lead the agency — but its ability to make sweeping changes or enforcement action has so far been limited.
The majority of Democrats in the five-person agency are now opening the door to Khan’s agenda, which is expected to include:
1. New rules for privacy and competition. Biden called on the Federal Trade Commission to draft rules on data and surveillance, as well as rules banning unfair methods of competition in online markets, as part of a wide-ranging executive order on competition last summer.
- Khan will now have the votes to propose new rules around unfair competition practices, child privacy, consumer privacy and the use of non-compete contracts, along with data use and monitoring.
2. Strict enforcement on deals. The same executive order said the FTC had the ability to challenge previous mergers, something the FTC itself highlighted when Amazon closed its deal with MGM after time ran out in the agency’s review.
- Agency watchers are telling Axios Khan may wait for a larger case against Amazon that goes beyond its MGM purchase.
- “[Khan] He was put in charge of the agency with a strong bipartisan majority to address market power problems arising from the big tech companies. The crux of these problems is its ability to leverage its power in the markets through acquisitions, Sarah Miller, executive director of the American Economic Freedoms Project, told Axios.
3. Stricter guidelines on mergers. The administration has called on the FTC to scrutinize mergers and acquisitions by dominant internet platforms, especially when buying smaller competitors, and Khan will be able to screen and challenge mergers more successfully with a manual vote.
- Separately, the Federal Trade Commission and the Department of Justice are also working on new merger guidelines, which could change the way companies handle acquisitions.
- “In terms of antitrust, the first item will probably be a review of the merger guidance, along with the Department of Justice,” Daniel Francis, former deputy chief of the Federal Trade Commission’s Office of Competition, told Axios. “In practical terms, this is the most important merger monitoring and review document in the country, and everyone is waiting to see what the agencies will change. The new third vote will make all the difference.”
what are they saying: Bedoya’s arrival means that “the urgent work of reining in the uncontrolled power of increasingly concentrated industries can finally move forward at the Federal Trade Commission,” said Alex Harman, director of government affairs for competition policy at the Economic Security Project, an antitrust nonprofit organization. Founded by Chris Hughes, a former Meta co-founder, told Axios.
the other side: Khan’s FTC critics, including the US Chamber of Commerce, have said its new Democratic majority marks the end of the bipartisan partnership at the agency.
- “Once it receives a third vote, I expect an unprecedented influx of aggressive and partisan actions that continues to undermine the committee’s long history of bipartisanship,” said Neil Chilson, a senior research fellow in technology and innovation at Stand Together and a former advisor to the Federal Trade Commission.
Between the lines: Democratic Commissioner Rebecca Kelly Slaughter, the former acting president, and Pedaya will have so much influence over the agency’s work that Khan will need their support to advance its agenda in the face of Republican opposition.
Yes, but: Khan will also need the support of FTC staff, who do the work of writing the rules and guidelines. A recent survey showed low confidence in top leaders among FTC employees, and Politico reported on tensions between FTC leadership and longtime employees.
- “The FTC has been a gem of an agency, and a community of professionals dedicated to consumer protection,” Republican FTC Commissioner Kristen Wilson chirp about scanning. “The new leadership has marginalized and disrespected employees, resulting in a brain drain that will take a generation to fix.”