The Breakdown - Monopoly is Un-American: Matt Stoller on Google Antitrust

Episode Date: October 23, 2020

Matt Stoller works with the American Economic Liberties Project and is the author of “Goliath: The 100-Year War Between Monopoly Power and Democracy” as well as the popular Substack newsletter “BIG.” In this conversation, he and NLW discuss the history of American antitrust sentiment and politics including: The origins of antitrust sentiment  How the “Watergate Babies” generation of Democrats turned away from antitrust sentiment  How the 1990s shifted power in favor of corporates and tech  Why the 2008-2009 crisis was a seminal moment in our attitudes towards big finance  The significance of the new antitrust case against Google  Find our guest online: Twitter: @matthewstoller Web: mattstoller.com

It's a huge deal. It's the most important antitrust case brought in at least 20 years, maybe one of the most important of all time. Not only because Google is a trillion-dollar behemoth that's controlling information flow, which is, you know, that's super important to any democratic society, but also because it is a repudiation of that pro-monopoly ideology that really got inculcated in the early 1980s. It's a conservative Republican administration that's bringing the case. So that's it. The old libertarian model is done. This is a, a country that is going to fight monopolies. Welcome back to The Breakdown with me, NLW.

It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world. The breakdown is sponsored by crypto.com, nexo.io, an elliptic, and produced and distributed by CoinDes. What's going on, guys? It is Thursday, October 22nd, and on Tuesday, we had a momentous announcement. The Department of Justice filed an antitrust lawsuit against Google. My guest today, Matt Stoller, is one of the best-known writers and thinkers on the topic of antitrust, monopoly, and corporate political economy in America. He's the director of research at the American Economic Liberties Project and the author of Goliath, The Hundred Year War Between Monopoly, Power, and Democracy.

He also writes a substack newsletter called Big that is all. about corporate power and monopoly in America. I was tempted on this show to focus exclusively on the Google antitrust case, but one of the things that I think is so important about Matt's work on antitrust history is that when we talk about policy, we far too often forget our own history. We forget the context that created the types of political discourse we have. So in this interview, we spend a bunch of time on the history of the American anti-monopoly tradition. This is something that I think is quintessentially American as well. The idea of true competition, a free and fair market where different people can compete and

win and not be just locked out by giant megalithic entities is very quintessential to who we are. When I think about the breakdown, the show that I want to do is not just about Bitcoin, it's not just about macroeconomics. It is ultimately about power. It's about power and the society that we want to live in. It's about reasserting agency over the decisions that make up the society we want to live in. I think macroeconomics is fundamental to understanding that, and I think Bitcoin is an unfathomably different type of tool than we've ever seen before. But ultimately, what interests me is those big questions of power. And I think that's why this conversation about antitrust right now, especially in the context of this Google lawsuit, is so important. So without any further ado, let's dive in. And I hope you enjoy today's conversation. All right. We are here with Matt Steller Matt. It's an exciting day for this conversation. Welcome to the show. Thank you. Thanks for having me. So this is a conversation about a lot of different things economically.

but a lot about big corporate power, monopoly, and antitrust, which is what you've spent a lot of time on over the last few years. I love for people to, for those who aren't familiar with your work, just a quick background. And then I want to kind of come up through some of the history of antitrust in America to situate what is going to be a fascinating conversation today, I think, in the wake of the Google lawsuit that we just found out about. But first, who are you?

and how did you get into this particular topic? Who am I? Wow, what a big question. I don't know. I don't know who I am. Who is anyone? No, my name is Matt Stoller. I am an author,

and I wrote a book that came out last year, although now it's in paperback. It's called Goliath, the 100-year War Between Monopoly Power and Democracy, which is a history of corporate power and the corporation and anti-monopoly politics, so largely over the 20th century. And I wrote this book because I was a policymaker.

I was working in Congress during the financial crisis, and I worked on Dodd-Frank and financial reform and the bailouts and stuff like that. And I basically thought, why is everything so screwed up? Like what happened? Why do we make so many bad decisions? I'm a Democrat. I was like, why did my party do this really bad stuff? And so out of that, I kind of tried to learn the history that I thought, you know,

had been missing. and I can explain to you why that is. But out of that came Goliath, right, which is sort of the set of stories, the traditions that I thought were missing when the financial crisis discussions were going on. These are questions, I think, that a lot of, you know, listeners to your podcast are interested in.

They're questions about the meaning of money, the questions about the meaning of legal structures versus technical structures, how we relate to each other through trade, through finance, through political economy. a whole sort of set of conversations that I don't want to say they were totally missing in 2009 and 10, but certainly in the halls of power, it's not what we were talking about. Yeah, and I think one of the things that I really like about your work,

regular listeners know I was a history major. It's kind of the perspective that I bring to everything. And it is such a surprisingly missing piece of a lot of policy discourse. We have very short memories. And so, you know, there's a huge kind of moment in policy today around a, an antitrust lawsuit against Google. But before we get into that, let's go back into some of the history of antitrust. And, you know, you obviously spent a lot of time looking at this and decided to kind of start

your narrative where you started it. So maybe, you know, where did you start that kind of look at this sort of 100-year history of questions of corporate power? And why did we start there? Yeah. So, well, also, I'm a director of research at a think tank called the American Economic Liberty's Project. We focus on the problem of private power in America.

and so we've been working a lot with on big tech, both in Congress and other stakeholders. I got to get that out there as well. But I totally agree with you. I mean, I, so I'm a policy person, right? But I wrote a history. This is not a book. It's not a book that's about like,

here are a bunch of recommendations. I thought that, I really think history is fundamental to how we do policy. So just to kind of get, I know that's not the question you asked, but there we go. So I started, where did I start?

I started in 2009 and 10, right? I mean, that I, because I was trying to figure out, I was trying to answer a specific problem, which is why did, essentially, why did Obama screw up so badly, right? There was this guy that tremendous hope and change and, you know, it wasn't just Obama, the Democrats. Like, I'm a Democrat, as I said before,

and we were all like, we're going to come in and fix this, and then we didn't. In response to a crisis of concentrated wealth and power, we chose to further concentrate wealth and power. That's what the bailouts were about. That's what a whole bunch of the administrative machinery in 2000, the whole Obama administration was about. So why is that? And to understand that question, I had to understand what were the ideas.

You know, the traditional story is, you know, this is the left wing story. It's, oh, you know, it's money in politics. It's like people, politicians get bribed by campaign contributors and so they do things for them. And that's what the banks wanted. And that's not actually true. That's not actually what I, I mean, it's sort of true, but that's not actually what I found was happening. And there was a lot of really sincere, well-meaning people who honestly thought we have to put more power in the hands of bankers because who knows more about banks than bankers, right? It was a sort of real elite expert-driven vision of how to organize society.

And that really is, so what ended up happening is there was sort of this one person named Jane Dorista who during the whole crisis was telling me, hey, this market over here is going to blow up or this thing with derivatives is going to blow up. And then it did. And like nobody else knew what was going on. People at Treasury, the Fed, you know, nowhere out. They didn't know what was going on, but Jane Derista somehow did. So I was like, how do you know all of this? And she said, oh, I worked for this guy in the 1960s, a congressman who chaired the banking committee named Wright Patman. And, you know, he was a new dealer. And he had put all these, helped put various rules on banks. And he was fighting against the deregulation of the 1960s and 70s. And she was a staffer for him. So she saw all these rules get pulled apart. And so she knew, she was like, oh, this guardrail got pulled off.

So I know, you know, there's a what's going to happen when this, the blowup is going to happen over here because we took this guardrail off and we took that guardrail off and so on and so forth. So, and then she told me about his life. And right patent was elected in 1929. And then he was overthrown by the Clinton generation in 1975. 1974 was Clinton's first election, but there was a large generation of Democrats called Watergate babies because they were elected in response to Watergate. And they really changed the vision of political economy that the Democrats had. They really tossed the populists, the sort of the working class, white working class in particular, out of the party. And change their political economy to be much more favorable to finance and monopolization.

And they were rebelling against populists like Wright Patman and others who were in that vein like Fragherzell Roosevelt, belt, Lewis Brandeis, Francis Perkins, and so on and so forth. So then what ended up happened, I had to learn all about Wright Patton. And in order to understand the generation that was running policy in 2009 and 10, I was like, okay, because they all learned from like the Watergate babies in the 70s, or they were Watergate babies themselves. So I went back and I looked at Patman's life. And Patman, as it turns out, got his kind of foundational start going after Andrew Mellon,

who was this billionaire private equity guy, who was also the secretary of the Treasury from 1921 to 1932. And Wright-Pappen actually filed articles of impeachment against him in 32 at the deaths of the Depression. And so he was fighting these sort of robber barons, and he put rules against monopolies on chain stores and then helped fight against banking consolidation in the 50s, 60s and 1970s. And I was like, who's this guy in Mellon? Andrew Mellon was very powerful. he actually is the guy who put Alexander Hamilton on the $10 bill, or it was $20 bill, well, one of the two. And then I was like, okay, so who is Andrew Mellon? It turns out Andrew Mellon is kind of like the second generation of J.P. Morgan type of banker financiers.

And so that led me to basically the foundation of corporate America, which is the 1890s and early 1900s. and the focal election of that moment, which was the election of 1912, which is corporate America had been around for about 20 years or so. And this was the time when people were saying, okay, we don't like the way that the railroads and the oil companies and the meatpackers are operating. And the 1912 election, which was Woodrow Wilson, Teddy Roosevelt, Eugene Debs, and William Howard Taft was kind of this great ideological battle

over the nature of corporate America. And so that's really where I started the kind of, of this story. The chapter, well, the opening chapter is Bright Patton getting overthrown. And then it's a flashback to Teddy Roosevelt coming out with a speech called on what he calls the new nationalism, which is how to deal with the great challenge, the great crisis in America, the third crisis in American history, the first being the American Revolution, the second being the civil war with the slave power, and the third being what Teddy Roosevelt called, the great special interests, which was the corporation. And so he comes out with this framework,

new nationalism. And Woodrow Wilson fights him with something called the New Freedom. William Hattertap has his ideas. Eugene Debs is a socialist. He has different ideas. And that's where I started it. And then I ran through the battles over the corporation, Robber Barrett's, up until sort of the new deal. So the first half is kind of from Teddy Roosevelt to the end of World War II when it was the takedown of the robber barons who had concentrated almost every sector of the economy. And then the second half is why the robber barons were able to come back, to come back. And that's a more of an intellectual story about people on the left and people on the right and Reagan and Clinton and what they did in terms of concentrating power. So that's the book. And Wright-Patman kind of

is the through line for all of it because he was, you know, he grew up rural Texas and then was this great anti-monopoulos over through Andrew Mellon and then fought to kind of keep the New Deal arrangement together to break up all of these monopolies and banking empires. And then he himself was overthrown in the mid-1970s, which was sort of a clear moment when it was evident that the robber barons were going to come back and they have. And now we are back to this era, which looks a lot like the early, I think the early 1900s where you have concentration everywhere. and very chaotic politics and all sorts of weird and interesting attempts to address banking power like, you know, cryptocurrencies, but other questions. And also giant antitrust cases.

So it's like this fascinating moment. And I wrote the book to try to explain the tradition that really situates us in where we are today. So it's really fascinating. One of the things that seems so different about monopoly questions is that. is that while the response to them might follow clear party lines, it's not like from a general kind of voter-based standpoint, there's like a whole big group that's really pro-monopoly and a group that's not, right?

I mean, is that kind of a historical misperception? Is that me reading now into it? I mean, it seems like there's never been people who were kind of rallying for the monopolist, right? It's more a question, perhaps, of what's the right approach? I mean, does it, how much have questions of monopolies, I guess maybe you try to put it into a question, historically been their own subject and question versus wrapped up into larger fights about the relationship between governments and the private sector? Well, so my book is the subtitle is the 100-year war between monopoly power and democracy. So monopoly and anti-monopoly politics are always a subset of larger ideological battles.

And I could have called it the 400-year war because you really have to go back to the 1600s to see the origin of the modern anti-monopoly movements, which were really the British. And I'm, you know, I got really into the English Civil War because it's basically the foundation for a lot of the American political economic traditions. It was the British, the British kings, the Stuart Kings that were using monopolies to get around Parliament. So instead of going to Parliament and raising taxes, they would hand out. monopoly grants playing cards and things like that to their cronies. And it was a, it was a political, they were using it kind of as gangsters, but there was a big Catholic, Protestant thing that was going on as well. In the American tradition, I mean, there were colonies who were, you know, having these British colonies, so they were having these debates too. You know, you roll that forward

in the American Revolution, what you had the East India Company, which was a monopoly. Like, monopoly politics is foundational to our identity, to who we are. And you know, you did have, I think, pro monopolists, explicit pro monopolists. I think Alexander Hamilton was a, was pro monopolist and his sort of patron Robert Morris. They thought that monopolies, you know, would put the better sort in charge. They were sort of quasi-aristocratic. The slave owners in the late, in the 1850s, they were monopolists. They concentrated land in slave ownership. It was a very much, oligarchy. You know, I don't think, I think you have some people kind of occasionally who will say, yeah, yeah, we like monopolies. But really the rhetoric shifted because there's just this general

sense that Americans just don't like market power. They don't like monopolists in general. It's a big part of American tradition. What usually happens is that it's not, is that monopolist sort of disguise what they're trying to do by saying, well, we want competition. We just want competition in a different way. Big isn't bad. We're just big and powerful because we have better products and services. It's not because we're exercising power. So that's what you'll see from the monopolist. This has been the rhetoric really since Hamilton because I don't think you can get away with saying, yes, I like monopolies. Although, you know, you did have some people saying it here or there, like they do say the quiet part out loud occasionally. If you look at the polling, I mean,

this is to your point about today, the 90% of people don't like monopolies. It's just like they don't like monopolies, but there are splits in how they think that we should, what we should do about them, break them up, regulate them, do nothing. You know, a lot of people are like, I don't like monopolies, but I don't trust the government to do anything about them. And then there are questions of, then about the 10% of people that are not against monopolies. It's not that they're for them, they just don't know. But the number one kind of political problem in dealing with monopolies is that people don't think that it's possible for the government to take it on. They think the government is corrupt or they think that it's the monopoly powers to extensive, you know, Congress is a mess, whatever it is.

So it's really it's cynicism and nihilism. That's the opposition here. It's not actually like monopolies are good because those arguments are sort of are mostly ridiculous. Yeah. So, I mean, there's, God, it's hard for me to not just jump straight into tech and what makes it so interesting and different. But I think I still want to kind of drag us up through the history a little bit. So, okay, so we have this sort of inflection point moment in the 70s, the Watergate generation

of Democrats come in. What is the genesis of their, well, I guess on both sides of the aisle, what is sort of the prioritization that shifts in such a way that the antitrust tradition starts to change? So, no, it's a great question. And this was the hardest part of writing the book, because, you know, Goliath, it's like, how do you tell the story of forgetting, right? You've got this tradition that goes back to the 1600s of fighting corporate, power, which people saw is coercive and autocratic. And they didn't make the distinctions between the

private sector and the public sector, which are kind of artificial anyway, because corporate charters, courts, contracts, all that's rule of law. All that stuff is public. So these are public institutions. So how do you airbrush that whole tradition out of our memories such that, you know, I'm as a history major as well, but sitting in that in that chair in 2009, I had no idea about that this tradition existed, right? How do you do that to a culture where people who study its history just don't know that this stuff existed? Well, you know, I think that what you do is you substitute a different history, right? That's what you do. You write a different history. And what happened in the 1950s and 60s to lead to these moments in the 70s was just that.

You had historians largely at Columbia University and then you had an economist at Harvard. So this guy named John Kenneth Agalbreath, who is a very famous economist. And then a historian named Richard Hofstetter at Columbia, a bunch of people at Columbia, like C. Wright Mills and Daniel Bell, a whole bunch of others. And they told a different story about America. So the traditional story of America was there was class conflict, there were these fights over a corporate power and race and slavery and a bunch of it. but it was kind of like questions about corporate domination or not. A lot of the ideas of revolting against England for liberty and opposing the King's chartered corporations and monopolies.

That was how people understood the world. And then the populists in the 1880s and 90s, which were a bunch of farmers that were angry, that railroads and bankers had a lot of power over them. So what Hofstetter did is he said, actually all that stuff about populace, populists and, you know, being upset with political economy. That's not actually true. They thought that, they might have said that, but actually what's going on is these are just white Anglo-Saxx and Protestants, wasps who are afraid of immigrants. And they were using railroad barons and bankers as a sort of mask to mask what they called their status anxiety. So it was a cultural America, I mean,

Hofstetter is a socialist, Goldreth was a socialist, too. They both basically said, America's never really had any ideological disagreements. We've always been a capitalist society, Protestant capitalist, everybody likes markets. There's no distinctions there. Hoover and FDR, they didn't really have any ideological distinctions. They just kind of were different personalities, which is complete nonsense. But that's the argument that they made. But you have to find a reason why all these farmers were mad at all.

these railroads. And so they said, oh, this is status anxiety. Ideas of the money trust, ideas of J.P. Morgan, those are all kind of conspiratorial, you know, nonsense. It's a very famous essay that Hofstetter wrote called the paranoid style in American politics, which comes up occasionally when people want to be really mad at, you know, they think their opposition or a bunch of psychos. They're like, oh, it's all just because they're irrational. That's what Hofstetter did. He said, these political economy conflicts were irrational, it was a bunch of paranoid cranks. who were afraid of their own, you know, that their own ethnicity was becoming less important. And so they substituted that.

In fact, you know, the American corporation, all this stuff just happens naturally. Monopolys are good. They're just progressive, big companies are, you know, they produce prosperity. And in the 1950s and 60s and early 70s, it kind of looked like that was the case because income growth kept going up, productivity was going up. There were really no economic problems of any import. But all of a sudden in the 1970s, things start collapsing, right? New York City almost goes bankrupt.

And so this generation of Watergate babies who had grown up reading Gullbreath and Hofstetter and learning this consensus history, they started looking around. They're saying, what's going on? Why do we have inflation? Why do we have financial crises? Why is our train system going back? What do we do about New York City? Like, what do we do?

And the only people who had been thinking about political economy were at the University of Chicago. was Milton Friedman, Robert Bork, a series of George Stigler, a series of thinkers who wanted to attack the New Deal and attack the regulatory constraints and anti-trust enforcement. These were pro-monopoulists. I mean, they were almost explicitly pro-monopoulos. So they probably wouldn't put it that way, but that's what they did. And so they recrafted our legal framework.

And the right and the left kind of got swallowed up into it because they had all learned a history. in which political economy didn't exist, in which corporations and banks were not political institutions. This whole history of battles, of market structure, just didn't exist for these guys, for this giant generation. They were very consumer-oriented. They cared a little bit about labor and tax rates. But in terms of market power, that was not.

It might be a problem, but it wasn't a political problem. And so that battle happened and ended in the late 1970s, early 80s. Reagan gets rid of antitrust. Clinton gets rid of anti-monopoly rules in a host of different areas, including telecommunications, banking, the defense industrial base, and so on and so forth. You have rapid consolidation throughout the 90s and 2000s, and now you have these big tech giants that we're facing because we haven't enforced anti-monopoly rules in 40 years.

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with confidence. The busiest compliance teams rely on Elliptic's rigorous blockchain monitoring solutions to scale up and save money. Protect your customers. Manage your risk. Scale your business. Visit elliptic.co slash coin desk to talk to a cryptocompliance expert today. That's elliptic.com slash coin desk. How much was there a narrative in the 90s of how much was their self-aware? I guess of the need to be less regulatory around the internet. How much was there a desire to let the internet flourish, to have that be a new source of economic strength? And did that play into it at all? Sorry. As opposed to being simply a continuation of a tradition of kind of moving away from antitrust, was there actually sort of a positive deregulatory kind of narrative coming with the rise of tech?

Because I guess what I'm interested in is trying to understand the foundations for how tech became such a darling, right? The big companies that we all love, which I think a lot of us still do, you know? And I just wonder if as you were researching that, you know, that 90s becomes a really interesting pivot point, too, in some ways. Yeah. So we have to distinguish between the technology itself, which is miraculous and amazing, and the legal structures that have captured that technology.

And we also have to remember that, I mean, I think there's this narrative that Google and Facebook and Amazon spin, which is, oh, they were started in. garages and they're all just, it's just a bunch of innovation that came from like, from engineering geniuses. That's not actually the, the, the, what happened. These are, these are financial conglomerates that merge their way to dominance. It's actually pretty similar to what happened in the 1890s with the US steel, which was America's first billion dollar corporation, bought up, I don't know, about 400. It was a series of merger waves. And they bought up, you know, hundreds of, of companies that did, you know, the iron and steel.

production. And that's similar to what happened from 2004 to 2014 with Google and Facebook buying up large numbers of companies in the ad tech space and social media and search and mapping and so on and so forth. So the conglomerates that we're dealing with now are a result of merger waves. And those merger waves happened because we didn't enforce anti-merger laws and because we didn't have rules around data and privacy. So to start with, you know, start with that, I mean, I would say that to what extent that deregulation sort of create the stuff

that we love about tech. Deregulation, one of the things I go into in Goliath is that there's no such thing as deregulation. There are, someone's gonna be setting market rules, right? And either that's gonna be, to be public institutions or it's going to be private monopolists. And when Mark Zuckerberg talks about how he's, you know, how he manages community standards, he's a regulator. He may not, you know, have a official government position, but he has said, you know, and this is a direct quote,

in many ways, Facebook is more like a government than a business or we're setting policies. I mean, he said that. So deregulation, what they called deregulation was really, moving regulatory power from public accountable, democratically elected institutions to private ones, basically to financiers. So that's, you know, so that was that a good thing or was that a bad thing? I think did it create technology or not? I mean, I think you can look and see that there were digital technologies before you saw this massive trend in the 1980s. And they were, the technology was advancing really rapidly and in many ways Silicon Valley itself was created by an aggressive antitrust regime and government procurement in the 1950s and 60s and 70s.

And much of the great technology that we saw with the web came in the 2000s after the anti-trust suit against Microsoft. And that took down the chokehold that Microsoft had over are over the web or potential chokehold. And so you saw the emergence of Google and Facebook and sort of Web 2.0. So I think it's hard to say that, you know, government pulling back from exercising authority opened up the door to new technologies. You did have, you know, I think you could say that in some cases, but I wouldn't necessarily kind of give a broad characterization that way.

Yeah, yeah. That's super interesting. I think, too, one of the things I was thinking about is you were talking about the Microsoft. One challenge that we have now is there have been so few examples of this that we don't have narratives for the consumer upshot of a stronger antitrust regime. We don't have, like, all we have to compare is like Amazon seems to get more convenient every day. And so that feels like if we kind of rip that apart with that, threaten that. we don't have a counterpoint where things actually got better or different because we just haven't

done that sort of regulation for years and years and years, which is kind of just a fascinating little subset of the public discourse around it. Yeah, I mean, it's true. That's why I went to history, because there actually are not a lot of great examples today of, I mean, everybody talked about the Microsoft case because that's the only one that anybody remembers. I would say there are two market structures that you can look at as examples for a different model for what we can do. In the mid-2000s, the internet was very different. You had a lot more, I think it was a weird or more interesting place, less centralized. But you can look in, this isn't a regulatory intervention issue,

but the market structure of podcasting still looks is pretty open. It's still, you know, Spotify is trying to roll it up, but they haven't yet done that. So if you have something to say and you have an audience, you can do that. No one's going to block you. People can get access to it through a range of different distributors. and apps. Also, there are a bunch of different ad networks. So you can, if you get an audience, you can get funding. I mean, it's not a perfect system, but it's a pretty open system. And that was how the web was in the mid-2000s. And now it's a nuclear winter because it's been rolled up

by Google and Facebook who have vertically integrated. So they control all the advertising. They control the distribution. And if you're not on Google, then you don't get to market. And if you're not at Facebook, you don't get to market. So I think you can look at podcasting, say there's a different media system. It works a lot better. You have a direct relationship with your audience and your audience has a direct relationship with you. You're not intermediated by anyone yet. And that's what anti-monopoly rules can do. They can make sure that that market structure, which is really about preserving your relationship with your audience and your voice is retained. So, you know, just going in, like we can talk about breaking up Google and

Facebook, but we can also just say, hey, Spotify shouldn't be able to, you know, pick and choose winners in the podcasting space. They shouldn't be able to interpose themselves between, you know, a podcaster and their audience. The other example is the beer industry where you've seen a lot of craft brews. And that's because the 19th Amendment, or I think of 19th or 20, when they repealed prohibition, they said that alcohol regulation is going to be at a state level. And most states have separated out distribution, production, and retail. And so, you know, unlike when you go to a restaurant or their bar, and you can only order Coke or Pepsi,

you know, because soft drink distribution is consolidated in the hands of either Coke or Pepsi, so they don't let their, they don't let opponents or their competitors in. When you go to a bar, you can order beers who compete with each other because the distribution is controlled, usually, often by a third party. That's changing, but you can just, you can see, like there's a lot more craft brews than there are kind of craft soft drinks. And so it's with podcasts and with the beer industry.

You can see an outline for what America used to look like prior to the 1980s. It's a really fascinating example. I might throw newsletters that are kind of emerging as a new thing in there too where email is there. Totally. Open system, right? Shout out to Big, by the way. I really enjoy it. But yeah, it's a, you know, the podcast thing is also a great example.

from the standpoint of the fundamental tradeoff in some ways is what type of efficiencies are we willing to let go for a more robust competitive environment? Because it's not surprising why, you know, deals like the Spotify deals that we've been seeing are appealing to podcasters. There's a reason that podcasters are investing in YouTube because it's a system with a knowable, gamable algorithm. And there is, no, if you've noticed, you cannot find someone online really who's a credible growth hacker for podcasts, because it's just, it doesn't work that way through because there's not a single channel with an algorithm that you can hack, that you can do the things. All you can do is, you know, the tried and true tricks of people with big followings that you get on your show and hopefully you get it,

you know, a distribution partner or something, but it's very different. And we can talk about that all day, but actually, let's move. Growth hacking is fundamentally unhealthy, right? For podcasts, you know, You build your audience by just, you know, doing a good podcast that people want to listen to, right? Not by like screwing that up with all sorts of manipulative tricks, which is great. I mean, not saying every open system is like that. But I hadn't thought about that, the point you just brought up about how there are no growth hackers in podcasts. I've looked extensively, by the way, to try, just because I'm always interested in how systems work, you know. But it's business.

I mean, you have to do it, right? I mean, you can't. That's the thing about markets is that you're going to. mind, if there were a growth hacker for podcasts, you know, if you didn't do it, someone else would, right? So it's not like the competitive dynamics are not about, you know, a lot of people look at Mark Zuckerer, they're like, oh, he's a bad guy. And that may be true, it may not be true. It doesn't matter, though, because if Mark Zuckerberg didn't exist, a different person who was like Mark Zuckerberg would come and have rolled up all of that power. And Facebook might look

slightly different than it does today. It might be called something different. But fundamentally, these are questions of public policy that structure markets. And the market dynamics are what's driving the consolidation and in many ways the cheating and theft and so on and so forth. So I don't put this on any kind of individual business person. I think this is a question of policy and market structure. I think too. I do want to come back, you know, before we were done talking today, to the question of cynicism and disbelief in the ability of the public sector to meaningfully regulate because it does feel that there is, you know, the type of network effects that we're dealing with in the kind of socially connected internet era feel immense and different than

other types of businesses that we've taken on before. And so I want to come back to that point. But first, I almost want to come now up to 2008, 2009, and what has changed? You wrote a line, I think it was in your Biden piece about what Biden would do vis-a-vis antitrust. where you said, America of 2020 is just a very different place than it was 12 years ago, economically, politically and intellectually. And I want to talk about that in a couple dimensions. One of them is how we fell out of love with big tech, because I think that's been an important part of that 12-year story.

But first, maybe let's go to that feeling of betrayal, frustration, that I don't think you are alone in feeling in the wake of the great financial crisis and the lack of consequences in some ways. how did that set off the next 12 years that you've been kind of observing? I think there were a number of things. I mean, first of all, there was the financial crisis, right, where people all of a sudden were like, wait a second, banks are not just technocratic institutions. Banks and corporations are political.

There was Occupy Wall Street, the Tea Party, Black Lives Matter, Donald Trump got elected, which shocked Republicans and then Democrats. Nobody expected that. And really, I think in the Democratic Party, you know, remember in 2016, well, this is amazing. In 2011 during Occupy Wall Street, people are like, a lot of left-wingers are like, I was always against the monopolies. In 2011, during Occupy Wall Street, when Steve Jobs died, people had a moment of silence for Steve Jobs. And people were tweeting things like, here's to the crazy ones, hashtag Occupy Wall Street. Like, no, people were not against monopolies.

Like Steve Jobs is monopolist, right? He just, he was. That's what he did. I mean, he was also creative in many ways. but like, let's be clear about what he was doing. So, you know, you're going to be up against the 99% versus the 1% and you're praising Steve Jobs. That is a pro-monopoly culture that people are living in.

That's the left. So, okay, so 2016, you know, everyone's like, oh, Hillary Clinton's going to win and she's going to pick Cheryl Sandberg for her Treasury Secretary. And that's awesome because she wants to lean in and all this stuff. Like, this is the culture on the Democratic Party, let alone the Republican Party, which has always been far more favorable to. to concentrated finance.

Okay, so Trump wins. He totally throws everyone into disarray. People like, oh my gosh, what happened? Did we do something wrong? And then you have Cambridge Analytica, you have like scandal after scandal from Facebook. And these guys fall out of favor. People are like, wow, you're not magicians,

you're not sorcerers who are progressive and awesome and have a lot of money but are nice to gay people, which is kind of the way that Democrats think about corporate politics. You have power. You guys are marketers. And you make a lot of money doing things that can be dangerous. And so the Democrats changed when they saw that these guys were not magic progressive sorcerers that were going to make the world a better place.

And the Republicans, I think, changed when they saw that these guys were kind of private governments. And Republicans moving out of their libertarian world were like, wait a second, these guys have coercive sovereign power. And so Elizabeth Warren came out in 2016 and 2017 and said, needs to do something about monopolies. It was the first time that a politician had done that in decades. And over the last four years, I'm part of a movement

of anti-monopoulists, which in many ways is analogous to some of the arguments you're hearing about money itself, really questioning the political economy foundations of our culture and going back to these pre-1980 debates and bringing forward this idea that market structure is political. And now this is the result of this organizing, bringing back of history, the research that's come out of the financial crisis, and all of this

kind of understanding of chaotic politics. There's a lot more to it than that, but that's a short, a short story. So I know you're going to have to run shortly because of just how crazy today is. So maybe instead of trying to go all the way into this, let's just do the TLDR on the significance of this new antitrust suit against Google. This is something that has been kind of in the works for a while. How big a deal is it? And what should people be paying attention to over the next few months as this transpires? Yeah, big deal. It's a huge deal. It's the most important antitrust case brought in at least 20 years, maybe one of the most important of all time. And it's going to be a series of cases. The state attorney generals are going to bring some cases too. This is Congress has said

these guys need to be broken up. This is a big deal. Not only because Google is a trillion-dollar behemoth, that's controlling information flow, which is, you know, that's super important to any democratic society, but also because it is a repudiation of that pro-monopoly ideology that really got inculcated in the early 1980s. It's a conservative Republican administration that's bringing the case. So this is, you know, this is a, that's it. The old libertarian model is done. This is a country that is going to fight monopolies. And in terms of what people should be looking for what are the stakes of how this transpires? Is there a version where this cuts out, you know, future action or changes it? I mean, is this an inflection point that future cases will rest on?

Or would you anticipate seeing more cases come at the same time, even as this is being resolved? Well, there's, the rumors is going to be a Facebook case pretty soon from the FTC. I don't know, but that's the rumor, an antitrous case. There's also, I mean, there are investigations all over the world into Amazon, Facebook, Google, Apple. I think, you know, but also, you know, it's not just cases, right? We have anti-monopoly rules that are outside of antitrust. Congress can just pass the law saying, we're going to break you guys up, right? You can't be a platform and, you know, compete on that platform. Like, we've done that with railroads. We've done that with television. We've done that with airlines and aerospace companies. We've done it with banks. It would be

completely reasonable. We've done it with lumber companies. It's completely reasonable for us to do it with online commerce companies and logistics companies like Amazon or an ad tech search company like Google. So I think, you know, we're going to see regulation. We're going to see, you know, you can also do it with regulation. We can see regulation, potentially legislation, and then we just saw this case. So I don't think this is the end. I think this is the beginning.

And I think we're going to see like this is not an or problem. This is an and problem. So you're just going to see like a total attack on big tech. And then maybe a restructuring of a lot of other corporations in our economy. Awesome, Matt. Well, I'm so glad we got to grab you for this amount of time on what is such a crazy day. We'll have to have you back and follow up in a few months when we have more information. But really appreciate you hanging out and sharing your insight and what you've learned on this journey.

Thanks a lot, man. Talk you later. Unfortunately, as you could probably tell, Matt had to go a little bit early from what we thought because there's obviously just so much happening with the Google news just breaking this day. And I really appreciate Matt not rescheduling in general. So you guys could have this just right in the moment take. I think that in a future show, one of the things that I want to focus on with Matt or ask about is this question of whether there is something fundamentally different about regulating tech companies, whether the network effects of these social networks

make them more challenging, or whether that's just a mirage, an idea that's implanted in our heads because we've been taught to systematically disbelieve in American public institutions and American political institutions. I think that there's plenty of reason to be cynical about public institutions, but I also think if we want a robust society, we have to at least ask the question of what they can and can't do to help architect the future we actually want. There's so much more to explore on this topic. Let me know if this is something you'd like to hear more about and have us talk more about, maybe with other guests as well,

and I will make sure that we do that. But for now, I appreciate you listening, and until tomorrow, be safe and take care of each other. Peace.