@Alon @kentwillard If we are concerned abt welfare, we are concerned abt the welfare of all the humans, not just those willing or able to move to opportunity under current circumstance, even if that wld increase their productivity. If we are concerned abt democratic politics, we are concerned about the humans in proportion to their numbers, and if the fraction willing or able to move to opportunity is modest, don't blame "populism" for the bankruptcy of a politics that slights the place-bound.

@Alon @kentwillard None of this prejudices the solution space. One way to address the disconnect is to make it easier for people to live the dynamism imagined of homo economicus. Another way is to reshape productivity, so that, for example, geographical dynamism is less necessary because remote work. Lots of possibilities!

@Alon @kentwillard But if most of the working class still live within 15 miles of their parents, any "populism" — any functional democracy — will put a great deal of weight on those people as "representatives of the real working class".

@Alon @kentwillard (note: i edited "profitability" to "productivity" in one of the above posts; that's the word i'd intended to write.)

@jjoelson You’ve anticipated my response! Yes, sometimes large firms deploy market power on behalf of their own interests AND consumer welfare when they overlap, and it may be tempting to celebrate that. But it often works out badly. Firms with market power are simply not who we want acting quasigovernmentally on behalf of the public. As imperfect as our democracy is, their ability to weigh conflicting interests, and the bias imposed by the profit incentive, render the approach dangerous. 1/

@jjoelson The quintessential example is WalMart. In the 1990s, many of us (me too!) celebrated how WalMart was openly deploying its monopsony power (the power that comes from being a near-“monopoly” buyer, rather than seller) to squeeze suppliers for lower prices, even offering free consulting services to help them reorganize more “efficiently”. 2/

@jjoelson The net result seemed great at first — every day low prices! — but WalMart’s efforts destroyed many US companies by making them little Boeings, in the way we now understand Boeing to have destroyed itself. Plus, WalMart contributed hugely to the offshoring of American manufacturing to places where “low cost” (meaning often sweatshop or near enslaved) labor could be employed to cut costs. 3/

@jjoelson This was regrettable self-interestedly (offshoring US manufacturing so thoroughly has been a catastrophe for the US), and ethically (though that’s a more complicated case, you can argue that sweatshop near-slaver to multinationals is the first rung on a ladder to China style development, so is it “worth it”?). WalMart in any case continued relentlessly, because all the offshoring and price restraint contributed to its profitability. 4/

@jjoelson WalMart exercised its market power very openly and flagrantly against its suppliers, but under the then prevailing consumer-welfare standard, it was immunized from antitrust attention, since its exercise of market power seemed (under the narrow terms of antitrust analysis of the time) to be in consumers’ interest. 5/

@jjoelson You are right, I think, that sometimes Apple has used its market power where its interests and consumers have been aligned. Steve Jobs’ hard bargains with cell carriers may have been good for consumers as well as Apple. (With ebooks, there’s some irony, Apple was breaking Amazon’s WalMart-like use of monopsony prices to restrain ebook prices to $9.99! Was that “good”, because breaking the monopsony, or bad because raising consumer prices?) 6/

@jjoelson Given the world as it was, maybe Apple taking on these roles was at least provisionable laudable. But the world as it was, where the government had abandoned its role in regulating and structuring market competition, is exactly what DoJ now is trying to revise. Apple is just one of many firms that — very much rightly, in my view — will have to revise how it does business in light of a new and ultimately better reality. /fin

@jjoelson @matthewstoller I won't argue that the process is ideal. But here's the situation. 1/

@jjoelson @matthewstoller We in fact have antitrust laws strong enough to permit courts and regulators to act as DMA-style referees, and ensure firms act in ways that allow and encourage competition while they create value. Until the 1970s, firms in the US understood that even narrowly procompetitive actions that threatened competition in the longer term (a big firm competing aggressively in a new local market) would draw scrutiny. 2/

@jjoelson @matthewstoller Those laws haven't changed. A "revolution" occurred solely at the level of enforcement during the 1980s. Lots of stuff that was obviously illegal under the laws currently on the books and the way regulators and courts had previously interpreted them were suddenly effectively legal, because courts and regulators were persuaded, on the merits and by lobbyist $$$, to change their interpretation, or even simply to not enforce black-letter law. 3/

@jjoelson @matthewstoller (an obvious, Apple-related example of this is the Apple-Google relationship. advantageous product placement in exchange for kickbacks — "payola" was the name for it — is explicitly illegal in the United States. Apple and Google, along with every grocery store chain, do it anyway, because during the 1980s regulators explicitly decided they would not enforce that law.) 4/

@jjoelson @matthewstoller At the same time, we do not have a Congress capable of passing or managing serious new regulation of this extraordinarily powerful industry (not just Apple!) that is currently reshaping society in ways we may not like. Congress' dysfunction is a huge problem that will eventually be fatal to us as a nation if we don't fix it. But it is the present, and we need to stumble along until we do fix it. 5/

@jjoelson @matthewstoller So, in practice, our choices are to revive our dormant antitrust laws, and try as a public to encourage and discipline regulators to use that authority well and not ridiculously, or leave Apple — and Google, and Meta, and Microsoft — to reshape our society and markets as they will and have, in ways that most of us dislike far outside the narrow boundaries of product choices. (The nature of innovation has changed, under the behemoths.) 6/

@jjoelson @matthewstoller I agree that enforcement actions and court-cases and consent decrees might not be the optimal approach to restructuring tech markets, but they are for the near and medium term the only approach we have. Again, this is industry-wide. It's not an Apple thing. DoJ is saying to all the industry incumbents, we're all going to do things differently now, we're restructuring the market. 7/

@jjoelson @matthewstoller I'm very glad this is happening, even if in an ideal world I might want Congress to create a new agency that would build tremendous in-house expertise and perhaps develop standards as well as having coercive regulatory authority. But that's not on the table for now. 8/

@jjoelson @matthewstoller So far, everything regulators have asked for seem reasonable to me. In theory, you can be mad that big-firm innovation is now going to be second-guessed by antitrust regulators. But in practice, it seems to me we've erred much to long in the opposite direction, and its much too early to be worrying about ways that Apple will be constrained we don't like. 9/

@jjoelson As @matthewstoller points out in his piece, Apple now has tremendous market power we as consumers or developers don't even see. It's not cool that Apple gets to dictate product choices to car makers as a condition of getting CarPlay for example. Information technology coordinates all the things. If we let governance of information technology fall to a single or few private firms, we are ceding governance in general to those firms, it's an end of democracy. 10/

@jjoelson @matthewstoller How we arrange information technology is necessarily a public matter. It is absolutely true that Apple is in many respects a fantastic firm that has provided huge value to many of us. I've lived a long life in their ecosystems, and they've always been better than the alternatives. But that doesn't mean I'm willing to cede governance of society and markets to Apple (and Google and Meta and Amazon and Microsoft) shareholders. 11/

@jjoelson @matthewstoller That's basically what we've done, are on a long road down a path towards. I am delighted and excited that regulators are finally recovering their wits to do something about it, with the long-disused, now rather creaky, tools they have available. 12/

@jjoelson @matthewstoller We should of course object if they are doing things that will really kill the golden goose. But Apple, in fact, really doth protest too much. They really do do a lot of bad stuff that regulators should stop. Preventing repair and hardware interop. Blocking surveillance by Meta, but building it into iAd. They belong under scrutiny, just like their IMHO even shittier peers. /fin

@jjoelson @matthewstoller I was drawing an analogy between network effects and integration effects, not saying that Apple has network effects in the same way as Meta. In both cases, real value is provided to users. In both cases, we have allowed that value to be provided in ways that grant first-movers incredible advantages and market power. That is the problem to be remedied. 1/

@jjoelson @matthewstoller Network effects should belong to the public network, should not be Meta's private database. Integration effects should be provided in ways that allow third-parties to fully integrate and compete. Apple used to do that. Those old, scrapped User Interface Guidelines were a genius approach to letting third parties provide software that merged seamlessly with first-party software without granting first-party applications special advantages. 2/

@jjoelson @matthewstoller Fundamentally, what the antitrust work against Apple is about is not undoing the integration, but about requiring Apple to maximize the ability of third parties to fully integrate in ways that mean first party services have to compete. Apple can—if it is smart, will—fully maintain its marvelous integration, and let others plug into it on terms it doesn't unilaterally dictate, but must publicly in justify in ways competition authorities can understand and accept. 3/

@jjoelson @matthewstoller If Apple wants to maintain the simplicity of the App Store, it can do so, just let third parties be plugins to the same interface, like Amazon and merchants. (If they wish to maintain the branding of their curation, they can use skinning within the App Store app.) Letting PWAs be first class apps is pro-integration. The value of integration grows with what you can integrate! Why does Apple need a payments monopoly for integration? etc. /fin