The death of the Comcast–Time Warner Cable merger is an extraordinary victory for democracy. Along with the Federal Communications Commission’s recent decision on net neutrality, it signals the beginning of an anti-monopoly movement much like the one that broke up Standard Oil 100 years ago, ushering in an era of fairer American markets.
In early 2014, Comcast’s board of directors met to discuss a merger with Time Warner Cable. CEO Brian Roberts called the subsequent approval “a very special moment.”
Most commentators—including progressive writers like David Sirota—predicted that the merger would go through. After all, Comcast had pushed through its merger with NBC Universal in 2011 by buying up lobbyists in Washington. When I testified before the New York Public Service Commission last June, most groups submitting testimony assumed that the merger with Time Warner Cable would happen—we just needed to demand concessions on other fronts.
We knew the risks of the merger: Comcast had already abused its outsize power, bullying content providers like Netflix, requiring them to pay to reach customers. Comcast may have also silenced debate on MSNBC; the channel rarely mentioned the merger or union disputes. But in recent years, the FCC, the Federal Trade Commission, and the Department of Justice have had an anemic record on stopping mergers. After candidate Obama called out President Bush for the “weakest record of antitrust enforcement of any administration in the last half-century,” his own administration largely pursued the same weak path. Even the American Airlines–US Airways merger, initially opposed by the DOJ, went through.
At its core, this weakness flowed from a view of mergers as natural and serving consumer interests. But when FCC chairman Tom Wheeler indicated his support for net neutrality, the supposedly inevitable deal was called into question. This was a major change of heart, since Wheeler had resisted net neutrality only a year before. Sustained grassroots pressure had moved the president and the FCC. The 4 million comments on net neutrality; the leadership of Color of Change in redefining net neutrality as a civil-rights issue; the integrated organizing of Internet defenders like Fight for the Future (full disclosure: I serve on its board), Demand Progress, Free Press, and hundreds of other groups created a network stronger than the big-money lobbyists.
On April 18, Comcast was still insisting that there was no legal basis to block the deal. Then word leaked in Washington that the DOJ might come out against it. Immediately, Comcast backed down. And on April 23, the merger died.
Comcast’s defeat reminds us that we haven’t always accepted big banks, big agriculture, big oil, or markets dominated by big conglomerates. One hundred and ten years ago, antitrust activists held events around the country demanding action against the big companies. A few years later, Teddy Roosevelt used the Sherman Antitrust Act to break up Standard Oil. And while it took Franklin Delano Roosevelt to establish a persistent, rational antitrust policy in the 1930s and ’40s, Teddy Roosevelt’s choice to battle Standard Oil was a turning point in American history. It showed that we did not have to bow down before monopolists. We understood that no company should become so large or so essential to the economy that the political system would be obliged to prop it up.
What happened to this approach? In 1981, Ronald Reagan’s Antitrust Division rewrote these laws in the mold of the then-radical Chicago School of Economics. In essence, this meant embracing bigness as inevitable. Ever since then, antitrust law has lived on as a mere shadow of its former self.
The crash of 2008 was the first sign for many that this concentration of power could hurt ordinary people. While calls to break up the big banks went unheeded, the Reagan consensus on monopolies had finally gone bust. But that anti-monopoly sentiment remained limited to the banking sector.
Then, this spring, a cross-class, cross-race national movement turned US Internet policy around. People started to see the connections between big banks and big media companies. Elizabeth Warren, who is known for taking on the financial industry, joined the fight against Comcast, signing a letter opposed to the merger just a few days before the deal died. Al Franken, the leading senator taking on Comcast, has also become a leader in the fight against big banks. Along with Bernie Sanders, these senators are creating a populist fighting force representing the broad grassroots demand that we break up big companies.
When the Sherman Antitrust Act was passed, Senator John Sherman spoke of it in democratic terms, calling it “a charter of liberty.” The modern antitrust leagues are just beginning to form. For the country’s new anti-monopoly movement, the very special moment happened on April 23, and a new charter of liberty is in the making.