History of Antitrust and Fairness

Hello, podcast listeners. We're excited to announce that we're working on a new season of How to Fix the Internet coming in the next few months. But today we want to lift up an earlier episode that is particular significance right now. In twenty twenty three, we spoke with our friend Alvaro Badoya, who was appointed as a commissioner for the Federal Trade Commission in 2022. In our conversation we talked about his work there, about why we need to be wary of workplace surveillance, and why it's so important for everyone that we strengthen our privacy laws. We even talked about Dr. Seuss. Last week the Trump administration attempted to terminate Alvaro. along with another FTC commissioner, even though Alvaro's appointment doesn't expire until twenty twenty nine. The law is clear. President does not have the power to fire FTC commissioners at will. The FTC's focus on protecting privacy has been particularly important over the last five years. Alvaro's firing, the Trump administration has stepped far away from that needed focus to protect all of us as users of digital technologies. We hope you'll take some time to listen to this May twenty twenty three conversation with Alvaro about the better digital world he's been trying to build through his work at the FTC. And his previous work as the founding director on the Center on Privacy and Technology at Georgetown University Law Center. One of my favorite Dr. Seuss stories is about this town called Hotch Hotch. In the town of Hotch Hotch, there's a town bee, and uh, you know, they presumably make honey, but the Hotch Hotchers one day realize that the bee that is watched will work harder, you see. And so they hire a Hotch Hotcher to be on bee watching watch. But then, you know, the bee isn't really doing much more than it normally is doing, and so they think, oh, well, the Hotch Hotcher is not watching hard enough. And so they hire another Hotch Hotcher to be on Bee Watcher. Watchering Watch, I think is what Dr. Seuss calls it. And so there's this wonderful drawing of 12 Hotch Hotchers, you know, each one in either watching watching watch or actually, you know, the first one's watching the bee. And and the whole thing is just completely absurd. It's FTC Commissioner Alvaro Badoya describing his favorite Dr. Seuss story, which he says works perfectly as a metaphor for why we need to be wary of workplace surveillance and strengthen our privacy laws. I'm Cindy Cohen, the Executive Director of the Electronic Frontier Foundation. And I'm Jason Kelly, EFF's Associate Director of Digital Strategy. This is our podcast, How to Fix the Internet. Our guest today is Alvaro Badoya. He served as a commissioner for the Federal Trade Commission since May of twenty twenty two, and before that he was the founding director of the Center on Privacy and Technology at Georgetown University Law Center, where he was also a visiting professor of law. So he thinks a lot about many of the issues we're all so passionate about at EFF, trust, privacy, competition, for example, and about how all these issues are so deeply intertwined. We decided to start with our favorite question. What does the world look like if we get this stuff right? For me I think it is a world where You wake up in the morning and Live your life. And your ability to do what you want to do, see what you want to see, read what you want to read, and live the life. that you want to live is unconnected to Who you are. In a good way. In other words. What you look like, what side of the tracks you're from. How much money you have. your gender, your gender identity or sexuality. your religious beliefs. that those things don't hold you down in any way. And that you can love those things and have those things be a part of your life. but that they only empower you and help you. I think it's also a world where we see the the great parts of technology. You know, one of the annoying things of having worked in privacy for so long is that you're often in this position where you have to talk about how technology hurts people. Technology can be amazing, right? Mysterious, wonderful, empowering. And so I think this is a world where those interactions are defined by those positive aspects of technology. And so for me, when I think about Increasingly people are applying for jobs online. They're applying for mortgages online. They are doing all these capital letter decisions that are now mediated by technology and so This world is also a world where Again, you are treated fairly in those decisions and you don't have to think twice about hold on a second. I just applied for a loan. I just applied for a job. You know, I just applied for a mortgage. Is my zip code going to be used against me? Is you know uh uh uh is my social media profile, you know, that reveals my interests gonna be used against me? Is my race gonna be used against me? In this world, none of that happens and you can focus on preparing for that job interview and finding the right house for you and your family, finding the right rental for you and your family. Now I think it's also a world where You Can Start a small business without fear that The simple fact that you're not connected to a bigger platform or a bigger brand. be used against you. Yep. Where you have a level playing field. to Win people over. I think that's great. It's, you know, leveling the playing field is one of the original things that we were hoping the digital technologies could do. It also makes me think of that old New Yorker thing, you know, on the internet no one knows you're a dog. Right. In some ways I think the vision is on the internet, you know, I again I don't think that people should leave the other parts of their lives behind when they go on the internet. Your identity matters, but that it doesn't the fact that you're a dog doesn't mean you can't play. I'm probably butchering that. No, I d I I don't think you are, but it did I don't know why it did, but it it reminded me of one other thing, which is In this world, you go to a job. Whether it's at home in your basement like I am now, or in your car. Or at an office, at a business. And you have a shot at at at working with pride and dignity. Where every minute of your work isn't measured and quantified where you have the ability to focus on the work rather than the surveillance of that work. and the judgments that other people might make around That minute surveillance. And you can focus on the work itself. I think too often people don't recognize the strangeness of the fact that When you watch TV, when you watch A streaming site. when you watch cable, when you go shopping. All of that stuff is protected by privacy law, and yet most of us spent a good part of our waking hours working. And there are Really no federal worker privacy protections. That for me is one of the biggest gap in our sectoral privacy system that we've yet to confront. that you wanted to talk about definitely is a world where you can go to work. and do that work with dignity and pride. without minute surveillance of everything you're doing. Yeah. And I think inherent in that is this This observation that being watched all the time is it doesn't work as a matter of humanity, right? It's a human rights issue to be watched all the time. I mean, that's why when they build prisons, right? It's the penopticon, right? That's where that idea comes from is this idea that people who have lost their liberty get watched all the time. But yet So that has to be a part of building this better future, a a space where, you know, we're we're not being watched all the time. And I think you're exactly right that that we kind of have this gigantic hole in people's lives, which is their work lives. Where it's not only that people don't have enough freedom right now, it's it's actually headed in the other direction. I know this is something that we we think about a lot, especially Jason does at E F F Yeah, I mean, we write quite a bit about bossware. We've done a variety of research into into bossware technology. It's being used more and more and and why we need to to tackle it. Because I think a lot of people probably listening to this aren't as familiar with it as they could be. At the top of the episode, we heard you describe your favorite Dr. Seuss story about the bees and the watchers, and the watchers watching the watchers and so on into absurdity. Now, can you tell us why you think that's such an important image? I think it's a valuable metaphor for for the fact that A lot of this surveillance software. may not offer as complete a picture. as employers might think it does. It may not have the effect that employers think it does. And it may not ultimately do what people want it to do. And so I think that anyone who is thinking about using the software should ask hard questions about Is this actually going to capture what it I'm being told it will capture? does it account for the twenty percent tasks of my workers' jobs. So, you know, there's always an eighty twenty rule. And so as with work, Most of what you do is one thing, but there's usually twenty percent that's another thing. And I think there's a lot of examples where that 20% like, you know, occasionally using the bathroom, right, isn't accounted for by the software. And so it looks like the employee slacking, but actually they're just being a human being. And so I would encourage People to ask hard questions about the sophistication of the software. and how it map onto the realities of work. That's that's a really, I think, accurate way for people to to start to think about it because I think a lot of people really feel that If they can measure it, then it must be useful. Yes. In in my own experience, I before I worked at E F, I worked somewhere where eventually a sort of bossware type tool was installed and had no connection to the job I was doing. It was literally disconnected. Can you share can you share the general industry or or what it was? Oh it was it was software. I I worked as a I was in marketing for a software company and I was remote and it was remote way before p the pandemic. So There's sort of I think Bossware has increased probably during the pandemic. I think we've seen that because people are worried that if you're not in the office, you're not working and that, you know, there's no evidence. Right. Bossware can't give evidence that that's true. It can just give evidence in, you know, whether you're at your computer. Right. Whether you're typing. Whether you're typing, yeah. And what happened in my scenario without going into too much detail was that it mattered what window I was in. And it didn't always. At first it was just like are you at your computer for eight hours? And then it was, are you at your computer in these specific windows for eight hours? And then it was, are you typing? in those specific windows for eight hours. The scrooks kept getting twisted, right, until I was actually at my computer for twelve hours to get eight hours of productive work in, as as it was called. And so Yeah, I left that job. Uh Obviously. I work at E F F now for a reason. It was one of the uh One of the things that I remember When I started at EFF, part of what I like about what we do. is that we think about People's humanity right in in what they're doing and how that interacts with technology. And I think bossware is one of those areas where it doesn't Because it it is so common for an employer to sort of disengage from the employee and sort of think of them as like a tool. It's it's an area where it's easy to install something or try to install something where that happens. So I'm glad you're working on it. definitely an issue. Well I'm thinking about it and it's certainly something I I care about. And I think my hope is that You know, the pandemic was was horrific, is horrific. My hope is that one of the realizations coming out of it from so many people going remote is the realization that Particularly for some jobs. A a lot of us are lucky to have these jobs where a lot of our time turns on being able to think clearly and carefully about a about something and that's a luxury. But particularly for those jobs but my my suspicion is for an even broader range of jobs. that this idea of a work day where you sit down, work eight hours, and sit up And and that is the ideal work day. I don't think that's a maximally productive day and I think there's some really interesting trials around the four day work week. І my hope is that you know when my kids are older. that there will be a recognition that working harder, staying up later, getting up earlier is not the best way to get the best work from people. And and and people need time to think, they need time to relax, they need time to to process things. And so um th that is my hope that that is one of the realizations around it. But you're exactly right, Jason, is that one of my concerns around this software is that there's this idea that if it can be measured, it must be important. And I think you use a great example, um, speaking in general here. that a of software that may presume that if you aren't typing, you're not working, or if you're not in a window, you're not working. when actually you might be doing the most important work, you know, jotting down notes, g organizing your thoughts. That lets you do the best stuff as it were. I wanna jump in here for a little mid show break to say thank you to our sponsor. How to fix the Internet is supported by the Alfred P. Sloan Foundation's program in public understanding of science and technology. Enriching people's lives through a keener appreciation of our increasingly technological world, and portraying the complex humanity of scientists, engineers, and mathematicians. So a tip of the hat to them for their assistance. Privacy issues are of course near and dear to our hearts at E F F and I know that's really the world you come out of as well, although your perch is a little a little different right now. We came to the conclusion that we can't address privacy if we don't address competition and antitrust issues. And I I think you've come someplace similar, perhaps, and I'd love for you to talk about How you think privacy and questions around competition and antitrust intertwine? So I I will confess, I don't know if I have figured it out, but I can offer a few Thoughts. First of all, I think that a lot of the Antitrust claims. are not what they seem to be. When companies talk about how important it is to have gatekeeping around app stores. because of privacy and this is one of the reasons I support the bills, I think it's Blumenthal Blackburn bill to change the way app stores are run and kick the tires on that gatekeeping model because I I am skeptical about a lot of those pro privacy, anti antitrust claims. That is one thing. On the other hand, I do think We need to think carefully. About The rules that are put in place. Firing against new entrants and small competitors. And I think a lot of legislators and policymakers in the US and Europe. appreci this and are getting this right and institute a certain set of rules for bigger companies and different ones for smaller ones. I think one of the ways this can go wrong is when it's just about the size of the company rather than the size of the user base. I think that if you are, you know, suddenly have a hundred million users. that you're not a small company, even if you have you know, a small number of employees. But I I do think that Those concerns are real and th that that policy makers And people in my role need to think about the costs of privacy compliance. in a way that does not inadvertently create an unlevel playing field for small competitors. I will confess that sometimes Things that Anitrust problems. are privacy problems i in that they they reflect legal gaps. around the sectoral privacy framework that unfortunately has yet to be updated. So I think I can give one example where there was the recent merger of Amazon and One Medical and well I can't go into the antitrust analysis that may or may not have occurred at the commission. I I wrote a statement on the completion of the merger which highlighted a gap that we have around the uh anonymization rule in our health privacy law, for example. People think that HIPAA is actually the Health Information Privacy Act. It's not. It's actually the health insurance. Accountability act. Yep. And I think that little piece of common wisdom speaks to a broader gap in our understanding of health privacy. So I think a lot of people think that. HIPAA will protect their data. and then it won't be used in other ways by their doctor, by whoever it is that have their that has their HIPAA protected data. Well. It turns out that in two thousand when H H S promulgated The privacy rule, in good faith, it had a provision that said hey look We want to encourage improvement in health services. We want to encourage health research. Yeah, we want to encourage public health, and so we're gonna say that if you remove these you know eighteen identifiers from health data that it can be used Four other purposes. And if you look at the rule that was issued, the justification for it is that they want to promote public health. Unfortunately. did not put a use restriction. on that. And so now if any Doctor's practice, anyone covered by HIPAA and I'm not going to go into the rabbit hole of who is and who isn't, but if you're covered by HIPAA, All they need to do is remove those identifiers from the data. And HHS is unfortunately very clear that you can essentially do a whole lot of things that have nothing to do with healthcare as long as you do that. And what I wrote in my statement is that would surprise most consumers. Frankly, it surprised me when I connected the dots. What I'm hearing here, which I think is really important, is first of all, we start off by thinking that some of our privacy problems are really due to antitrust concerns. But what we l learn pretty quickly looking at this is first of all, privacy is used frankly as a blocker for common sense reforms i that we might need that these giants come in and they say, Well, we're gonna protect people's privacy by limiting what apps are in the app store and we need to look closely at that because it doesn't seem to be necessarily true. So first of all you have to watch out for the kind of fake privacy argument or the argument that the tech giants need to be protected because they're protecting our privacy and we need to really interrogate that. And at the bottom of it, it often comes down to the fact that we haven't really protected people's privacy as a legal matter. Right. ground ourselves in Larry Lessig's four pillars of change, right? Code, norms, laws, and markets. And you know, what they're saying is, well, we have to protect, you know, essentially what is a non market, but the the tech giants that markets will protect privacy and so therefore we can't introduce more competition. And I think at the bottom of this what we find a lot is that it's you know the law should be setting the baseline and then markets can build on top of that. But we've got things a little backwards. And I think that's especially true in health. It's very front and center for those of us who care about reproductive justice, who are looking at the way health insurance companies are are now part and parcel of other data analysis companies and the Amazon One Medical One is is another one of those. that that unless we get the privacy law right, it's gonna be hard to get at some of these other problems. Those are the three things that I think a lot about. First, that those pro privacy arguments. seem to cut against uh competition concerns. are often not what they seem second, that we do need to take into account how one size fits all privacy rules could backfire in a way that hurts companies, small competitors who are the lifeblood of uh innovation and employment, frankly. And and lastly, that Sometimes What we're actually seeing are gaps in our sectoral privacy system. One of the things that I know you've you've talked about a little bit is you're calling it a return to fairness. And that's specifically talking about a piece of the FTC's authority. And I wonder if you could talk about that a little more and how you see that fitting into a a better world. Sure. One of the best parts of of this job was having this need and opportunity to immerse myself in antitrust. So as a Senate staffer, I did a little bit of work on the Comcast NBC merger against against that merger for my old boss, Senator Franken. But um I didn't spend a whole lot of time on competition concerns. And so when I was nominated I quite literally ordered antitrust treatises and read them cover to cover. One well, it's sometimes it's wonderful and sometimes it's not, but but in this case it was. And What you si Is this Complete two sided story. where on the one hand you have this really anodyne Efficiency based Description. of Antitrust where it is about Enforcing abstraws and maximizing efficiency. the saying, you know, antitrust is about protects competition, not competitors. And you so quickly sight. of why we have antitrust laws and how we got them. And so I didn't just read treatises on the law, I also read histories. And one of the things that you read and realize when you read those histories is that Antitrust is isn't about efficiency. Anitrust is about people. And yes, it's about protecting competition, but The reason we have it is because of what happened to certain people. And so, you know, the Sherman Act. You listen to those floor debates. It is fascinating because first of all Everyone agrees as to what we want to do, what Congress wanted to do. Congress wanted to rein in the trust. They wanted to rein in John Rockefeller, JP Morgan, the Beef Trust, the Sugar Trust, the Steel Trust, not to mention, you know, the Rockefellers oil trusts. The most common concern on the floor of the Senate was was what was happening to cattlemen because of concentration in meatpacking plants and the prices they were getting when they brought their cattle to processors and to market. And then you look at nineteen fourteen, the Clayton Act again. There was outrage, true outrage about how Those antitrust laws You know? 10 out of the first 12 antitrust injunctions in our country post-Sherman were targeted at workers and not just any workers. They were targeted at railcar manufacturers in Pullman. where it was an integrated workforce and they were working extremely long hours for a pittance in wages. And they decided to strike and some of the first injunctions we saw in this country were used to stop There's strike. Or how it was used against I think they're called Dreage Men or Draymen in New Orleans, port workers and dock workers in New Orleans, who again were working these twelve hour days. for for nothing in wages. beautiful thing happened in New Orleans where the entire city Went on strike. It was, I think it was 30 unions. It was like the typographical workers unions. And if you think that that refers to people typing on keyboards, it does from the people typing on mechanical typewriters to the people loading ships in the dock of in the port of New Orleans. Everyone went on strike and they had this um this organization called the Amalgamated Working Men's Council. And they went, they wanted a 10 hour workday, they wanted pay, and they wanted shops. Two out of those three things. But I think it was the trade board was so unhappy with it that they persuaded federal prosecutors to sue under Sherman. And it went before Judge Billings and Judge Billings said, Absolutely, this is a violation of The antitrust laws and the curious thing about Judge Billing's decision is one of the first German decisions in a federal court. And he didn't cite for the proposition that the strike was a restraint on trade to restraint on trade law. He cited to much older decisions about criminal conspiracies and unions to justify his decision. And so What I'm trying to say is over and over and over again. Whenever You know, you look at the actual history of antitrust laws. It you know, it isn't about efficiency, it's about fairness. It is about how small competitors and working people, farmers, laborers. deserve a level playing field. And in 1890, 1914, 1936, 1950, this was what was front and center. For Congress. Great to end with a deep dive into the original intent of Congress, which was to protect ordinary people in fairness with antitrust laws, especially in this time when history and original intent are so powerful for so many judges. You know, it's solid grounding for going forward, but I also appreciate how you've you mapped the history to see how that congressional intent was perverted by the judicial branch almost from the very start. You know, this shows us where we need to go to set things right, but also that the stakes are high and that it's a pretty difficult road. Than so much, Alvaro. Well, it's a rare privilege to get to complain about a former employer directly to a sitting FTC commissioner. So that was that was a very enjoyable conversation for me. It's also rare to learn something new about Dr. Seuss and a Dr. Seuss story, which But As far as actual concrete takeaways go from that conversation, Cindy, what did you pull away from that really wide ranging discussion? It's always fun to talk to Alvaro. I loved his vision of a life lived with dignity and pride as the goal of our fixed internet. I mean those are good solid North stars, and from them we can begin to see how that means that we use technology in a way that, you know, for example, allows workers to focus just on their work. honestly, while that gives us dignity, it also stops the kinds of mistakes we're seeing, like tracking keystrokes or eye contact or other things as secondary trackers that are feeding all kinds of discrimination. So I really appreciate him really articulating you know, what are the kinds of lives we wanna have. I also appreciate his thinking about the privacy gaps that get revealed as technology changes and and the the story of healthcare and how HIPAA doesn't protect us in the way that we'd hoped it would protect us. In part because I think Hippa didn't start off at a very good place. But as things have shifted and say, you know, one medical is being bought by Amazon, suddenly we see that the presumption of who your insurance provider was and what they might use that information for has shifted a lot. Yeah. And that the privacy law hasn't hasn't kept up. So I I appreciate thinking about it from, you know, both of those perspectives. Both, you know, what the law gets wrong and how technology can reveal gaps. Exactly. Yeah. That really stood out for me as well, especially the parts where Alvaro was talking about looking into the law in a way that he hadn't had to before, like you say, because that is kind of what we do at EFF, at least part of what we do. And it's it's nice to hear that we are sort of on the same page and that there are people in government doing that, there are people at E F F doing that. There are people in all over in different areas doing that. And that's what we have to do because technology does change so quickly and so much. Yeah. And I I really appreciate the deep dive he's done into antitrust law and and revealing really the fairness is a deep, deep part of it in this idea that it's only about efficiency and especially efficiency for consumers only. It's a historical. Yeah. You know, that's a good. thing for us all to remember since we especially these days have a Supreme Court that is really, you know, likes history a lot and grounds and limits what it does in history. The history's on our side in terms of bringing competition law, frankly, to the digital age. Well that's it for this episode of How to Fix the Internet. Thank you so much for listening. If you want to get in touch about the show, you can write to us at podcastef.org or check out the EFF website to become a member or donate. This podcast is Licensed Creative Commons Attribution 4.0 International and includes music licensed Creative Commune 3.0 unported by their creators. You can find their names and links to their music in our episode notes or on our website at eff.org slash podcast. Our theme music is by Nat Keefe of Beatmower with Reed Mathis. How to fix the Internet is supported by the Alfred P Sloan Foundation's program in public understanding of science and technology. See you next time. I'm Jason Kelly. And I'm Cindy Cohen. This podcast is licensed Creative Commons Attribution four point zero and includes the following music licensed Creative Commons Attribution three point zero unported by its creators. Lost track by air tone. Common ground by Airtone.