Lina Khan, the chair of the Federal Trade Commission, faced a grueling four hours of questioning during a House judiciary committee oversight hearing on Thursday.
Republicans criticized Khan – an outspoken critic of big tech – for “mismanagement” and for “politicizing” legal action against large companies such as Twitter and Google as head of the powerful antitrust agency.
In his opening statement, the committee chair, Jim Jordan, an Ohio Republican, said Khan had given herself and the FTC “unchecked power” by taking aggressive steps to regulate practices at big tech companies such as Twitter.
He said Khan carried out “targeted harassment against Twitter” by asking for all communications related to Elon Musk, including conversations with journalists, following Musk’s acquisition because she does not share his political views.
Khan, a former journalist, said the company had “a history of lax security and privacy policies” that did not begin with Musk.
Other Democrats agreed. “Protecting user privacy is not political,” said Congressman Jerry Nadler, a Democrat of New York, in response to Jordan’s remarks.
Republicans also condemned Khan for allegedly wasting government money by pursuing more legal action to prevent mergers than her predecessors – but losing. On Tuesday, a federal judge ruled against the FTC’s attempt to delay Microsoft from acquiring the video game company Activision Blizzard, saying the agency failed to prove it would decrease competition and harm consumers. The FTC is appealing against that ruling.
“She has pushed investigations to burden parties with vague and costly demands without any substantive follow-through, or, frankly, logic, for the requests themselves,” said Jordan.
Another Republican member, Darrell Issa, of California, called Khan a “bully” for trying to prevent mergers.
“I believe you’ve taken the idea that companies should have to be less competitive in order to merge, [and] that every merger has to be somehow bad for the company and good for the consumer – a standard that cannot be met,” Issa said.
Khan earlier came under scrutiny from Republicans for participating in an FTC case reviewing Meta’s attempt to acquire a virtual reality company despite a recommendation from an ethics official to recuse herself. She defended her decision to remain on the case on Thursday, saying she consulted with the ethics official. Khan testified she had “not a penny” in the company’s financial stock and thus did not violate ethics laws.
But enforcing antitrust laws for big tech companies such as Twitter has traditionally been a bipartisan issue.
“It’s a little strange that you have this real antipathy among the Republicans of Lina Khan, who in many ways is doing exactly what the Republicans say needs to be done, which is bringing a lot more antitrust scrutiny of big tech,” said Daniel Crane, a professor on antitrust law and enforcement at the University of Michigan Law School.
“There’s a broad consensus that we need to do more, but that’s kind of where the agreement ends,” he said.
Republicans distrust big tech companies over issues of censorship, political bias and cultural influence, whereas Democrats come from a traditional scrutiny of corporations and concentration of economic power, said Crane.
“I don’t fundamentally think she’s doing something other than what she was put in office to do,” he said.
Congress has not yet passed a major antitrust statute that would be favorable to the FTC in these court battles and does not seem to be pursuing one any time soon, said Crane. “They’re just going to lose a lot of cases, and that’s foreseen.”
The FTC’s list of battles with big tech companies is growing.
Hours earlier on Thursday, Twitter – which now legally goes by X Corp – asked a federal court to terminate a 2011 settlement with the FTC that placed restrictions on its user data and privacy practices. Khan noted Twitter voluntarily entered into that agreement.
Also on Thursday, the Washington Post reported the FTC opened an investigation into OpenAI on whether its chatbot, ChatGPT, is harmful to consumers. A spokesperson for the FTC would not comment on the OpenAI investigation but Khan said during the hearing that “it has been publicly reported”.
In 2017, Khan, now 34, gained fame for an academic article she wrote as a law student at Yale that used Amazon’s business practices to explain gaps in US antitrust policy. Biden announced he intended to nominate the antitrust researcher to head the FTC in March 2021. She was sworn in that June.
“Chair Khan has delivered results for families, consumers, workers, small businesses, and entrepreneurs,” the White House spokesperson Michael Kikukawa said in a statement.
