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Chairman Nadler Statement for Subcommittee Hearing on “Reviving Competition, Part 1: Proposals to Address Gatekeeper Power and Lower Barriers to Entry Online”

Washington, D.C. – Today, House Judiciary Committee Chairman Jerrold Nadler (D-NY) delivered the following opening remarks during a Subcommittee on Antitrust, Commercial, and Administrative Law hearing on “Reviving Competition, Part 1: Proposals to Address Gatekeeper Power and Lower Barriers to Entry Online”:

“Thank you, Mr. Chairman, for holding today’s important hearing on gatekeeper power.

“It has been over a century since Congress enacted the first of several major federal antitrust statutes. Beginning with the Sherman Act in 1890, these laws were passed to preserve and promote competition. Earlier this week, Attorney General nominee Merrick Garland quoted Supreme Court Justice Hugo Black for the principle that antitrust law is ‘the charter of American economic liberty.’

“Today, however, this charter is in a state of disrepair. Across many industries, economic power is concentrated among a few powerful firms with outsized influence over our democracy, our jobs, and our social institutions.

“The Committee’s bipartisan investigation into digital markets uncovered abundant evidence of both anti-competitive conduct and harmful consolidation. The lack of competition online—and across our entire economy—demonstrate an urgent need for action.

“As we all know, a lack of competition and anti-competitive conduct is not just limited to social networks or online commerce—these problems show up in other critical markets

“For example, it is well-documented that the lack of competition in health care markets has been one of the primary causes of the skyrocketing price of prescription drugs and other healthcare costs

“Over the past several decades, labor markets across America have also become highly concentrated. Just as consolidation in product markets tends to have harmful effects for consumers, the growing concentration of labor markets has saddled workers with depressed wages and fewer opportunities.

“As our country begins to recover from the pandemic and the resulting economic crisis, non-compete and no-poach clauses impede the ability of workers to reenter the work force or find better jobs.

“This is unacceptable.

“It is clear that lax enforcement by regulators combined with the courts’ undue narrowing of the law has played a large role in creating the poor state of American economic liberty and the present monopoly crisis.

“With today’s hearing, we take an important step in the process of restoring competition online. The rise and abuse of gatekeeper power by a few dominant firms has undermined the goals of the open Internet. Instead of having an open, competitive ecosystem, online gatekeepers can and do put a thumb on the scale in favor of their own business and against innovators, entrepreneurs, and startups. Simply put, this allows them to pick winners-and-losers rather than compete on the merits.

“Moreover, there is growing evidence that insufficient competition online has reduced the incentive for powerful companies to implement privacy protections or to address the rise and spread of hateful rhetoric and misinformation on their platforms. Despite public pressure, including from civil rights community leaders, the lack of a competitive marketplace results in many firms becoming simply ‘too big to care.’

“It is abundantly clear that competition online is not simply a click away. High barriers to entry—such as network effects and switching costs—protect the incumbents’ market power and make it nearly impossible for new entrants to get a foothold.

“Over the last two years, this subcommittee, under the leadership of Chairman Cicilline, conducted the most significant congressional antitrust investigation in more than a generation. Having identified and studied the problem last Congress, we must now legislate and exercise our oversight mandate in support of a solution.

“I look forward to hearing from our distinguished panel of witnesses on these important topics. I thank Chairman Cicilline and Ranking Member Buck for their work last Congress and for holding today’s hearing, and I yield back the balance of my time.”

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