By Kainoa Lowman and Katie Hettinga
Welcome back to the The Economic Populist’s Weekly Rewind. Every Friday, we’ll briefly recap the week’s biggest news, updates, and developments in the fight against corporate power.
A quick scheduling note: The Economic Populist will be off next week for Thanksgiving. Scheduling will resume the week of December 1.
With that, here’s what to know this week.
Judge Rules: Meta is Not an Illegal Monopolist, and Enshittification of Social Media Can Proceed
On Tuesday, Judge James Boasberg ruled against the Federal Trade Commission in its antitrust suit alleging Meta illegally monopolized the market for “friends-and-family” social networking through its acquisitions of Instagram and WhatsApp. This was a “colossally wrong decision,” as Executive Director Nidhi Hegde put it. Meta’s deliberate transformation of social networking into advertising and influencer platforms included, according to former executives who testified at trial, throttling resources to make Instagram more secure, throttling ad content, hiking ad content to make its platforms less friendly, and creating unsafe conditions for friends and family sharing. Evidence exposed at trial included internal documents showing that Instagram’s algorithm had recommended millions of children’s accounts to adult users it internally profiled as “groomers.” The judge’s decision to attribute the erosion of friends and family sharing to shifting cultural norms ignores how Meta exploited its monopoly to engineer that change, to the detriment of its core user base. He also ignored how vital the current competitive market — and our democracy — could be today if Whatsapp and Instagram had evolved to each independently evolved to compete with TikTok.
Thus, there are serious consequences to Boasberg’s decision. Leaving Meta’s monopoly intact means it will likely continue to disregard safety and privacy, and extract supracompetitive rents from businesses trying to acquire customers through ads on its platforms. But this decision also represents a missed opportunity for a brighter future for the experience of social media. An independent Instagram and Facebook might be more attentive to their friends-and-family networks, and compete on things like safety and launching new features aimed at connection. WhatsApp has the installed user base to launch social-graph features and become a player as well. This is a universe of competition that we will never get to know. Instead, the friends-and-family elements of all three platforms will remain the neglected children of a parent corporation focused on chasing AI and short-form video.
New Economic Liberties Paper Reveals How Wall Street Killed Single-Family Homebuilding
On Monday, Economic Liberties released a new paper shedding light on how Wall Street—combined with the erosion of government support for main street lenders—has driven America’s supply shortage of single-family homes.
The problem, as we explained at greater length on Tuesday, is two-fold. First, Wall Street pressures publicly traded corporate homebuilders to prioritize the sale price of their homes over volume—a strategy that works, in part, because these big homebuilders hoard land to prevent potential competitors from undercutting them. Second, local, privately held homebuilders, which once built most of America’s housing stock with financial support from local lenders, cannot fill the supply gap because its increasingly difficult for them to access credit and land.
The solution, as we elaborarted on in a follow-up post, is a multi-pronged approach to restore some of the characteristics of New Deal-era homebuilding policy, which was massively successful in producing ample, affordable homes. This includes federal credit facilities for local lenders, taxes to discourage land hoarding, tackling investor ownership of homes as a financial asset, getting rid of anticompetitive regulations, and more.
There’s a lot of oversimplified takes on America’s housing woes out there. While not claiming to have a silver bullet, this paper will illuminate a big part of the story that you likely haven’t considered. You can read the full paper here, and catch mentions of it in the Financial Times and Washington Post. Research Director Matt Stoller also discussed the issue on MSNBC’s Velshi.
White House Announces Flurry of Trade Deals and Frameworks
In recent weeks, the press has been full of reports about trade announcements with Argentina, Ecuador, El Salvador, Guatemala, Korea, Switzerland, and more. Some of these are not trade agreements, but frameworks for potential future deals. (For instance, U.S. Trade Representative Jamieson Greer will travel to Brussels next week in an attempt to secure terms of an actual deal after a framework announcement with the EU in July). A common thread among actual deals and possible future frameworks is the United States agreeing to cut tariffs in exchange for other countries granting Big Tech and Big Pharma special new powers and agreeing to roll back domestic data privacy, antimonopoly, and other public interest policies.
The ostensible goal of tariffs that Trump announced during his campaign — to rebuild American manufacturing and create a boom of industrial jobs — is nowhere to be seen in this flurry of announcements. Indeed, the Korea deal (which, among other things, includes roll backs of special auto sector tariffs established after a Biden-era investigation and enacted earlier this year under Section 232 of the Trade Expansion Act) joins those with Europe and Japan in rolling back tariffs that were intended to rebuild one of America’s major manufacturing sectors: automobiles. Shortly after the Korea deal was made public, Hyundai announced $86 billion in new investments to make more cars in Korea to sell in the United States.
How this will play politically with the MAGA base who voted for manufacturing tariffs, not tariffs to leverage Big Tech and Big Pharma privileges, may depend on whether congressional Democrats are willing and able to bring attention to this gap between Trump’s populist talk and trade deals that favor Big Tech and Big Pharma over American workers.
Ignorance or Trickery in Food Tariff Cuts?
There is a great mystery behind the administration’s recently announced food tariff cuts. Those cover not only tropical products — including coffee, cocoa, bananas, and other tropical fruits that the United States can’t grow in commercial amounts — but also on tomatoes and beef. Does the administration not realize that virtually all tomatoes and half of our beef imports already enter the U.S. market duty-free via the U.S.-Mexico-Canada Agreement? And that another ¼ of our beef imports come from Argentina duty-free already? Or do they hope consumers are unaware of this and will think the administration is acting to tackle high prices? Something worth noting: these tariff announcements ignore the very real issue of corporate concentration suffocating agriculture supply chains — a major contributor to high prices.
Quick Hits:
Senior Legal Fellow Katie Van Dyck spoke with The Lever about private equity’s growing involvement in youth sports.
Senators Ron Wyden, Peter Welch, and Rep. Becca Balint have introduced federal legislation to crack down on price fixing via alrogithm in the rental housing market.
Economic Liberties and a coalition of consumer advocacy and competition policy groups sent a letter calling on state attorneys general to appeal Judge Amit Mehta’s misguided remedies decision in the DOJ’s antitrust case against Google’s monopoly on online search.