Democratic Senator’s New Plan Would Cost Amazon Prime Users $148/Year, Study Warns

Democrats and Republicans are currently locked in a speed race to see who can destroy the economy the fastest. To that end, both have settled on antitrust legislation as a favorite pet policy that would do the trick.

One particularly bad bill in this category is the Competition and Antitrust Law Enforcement Act, which is sponsored by Senator Amy Klobuchar (D, MN) and Congressman David Cicilline (D, RI). Essentially this bill would rev up the enforcement of antitrust laws, which (supposedly) use the federal government to “break up” monopolies and “promote competition.” 

As reported by the Center Square, the legislation would “increase enforcement resources for regulatory agencies, strengthen laws that prohibit certain mergers and acquisitions, and prohibit ‘exclusionary conduct,’ something that lawmakers have accused companies such as Facebook, Google, and Amazon of doing.” 

In her talking points, Klobuchar has claimed her legislation is needed to address the country’s “massive competition problem.” It’s a disingenuous argument.

One would be hard-pressed to truly find any examples of monopolies in the country, and where they may occasionally exist you can usually easily point to government subsidies or regulations that created an unfair playing field for them. (None of this is free-market capitalism, by the way).

So, this legislation is a “solution” in search of a problem. But it would have real consequences.

For one thing, it would move the US away from the “consumer welfare standard.” This legal doctrine essentially argues that the government should decide matters of antitrust on the basis of consumer welfare—what’s best for everyday Americans' wallets—not the whims of politicians. But people like Amy Klobuchar don’t like that standard. Instead, they want to be able to use the government to crush businesses they simply do not like or that they think are too successful.

As a result, Klobuchar’s plan would harm the economy and actively harm consumers—ensuring they have fewer choices in the market, lower quality of goods, and higher prices. You don’t have to take my word for it: According to a new study, the legislation could cost the economy a whopping $319 billion if enacted.

It was commissioned by a free-market trade association and conducted by the National Economic Research Associates. The analysis warns that the result of this legislation would be “increased costs and loss of services for consumers, small businesses and other users of the bills’ target companies — Google, Facebook, Apple, Microsoft and Amazon.” 

It also finds that the legislation would force the targeted companies “divest, eliminate or reduce the scope of services,” including Amazon Prime. 

Sticking with Prime as an example, the study estimates a loss to consumers of $22 billion per year! That’s $148/subscriber, the authors warn. 

All for what, exactly? 

The study concludes that the bills would “provide no offsetting benefits,” and “would not stabilize prices or reduce inflation… instead, they would reduce American innovation and entrepreneurship and harm U.S. companies more than foreign companies.”

Ultimately, this legislation, like almost all antitrust policies, would end up reducing competition instead of increasing it. That’s not capitalism, it’s corruption.

The government should never be empowered to pick winners or losers in the market. Under a true free market capitalist system, businesses could only survive if they offered a product or service that improved the lives of all people. Congress should not be in the business of bailing businesses out, and it certainly shouldn’t be working to break them up when they are successful. 

That’s what Amy Klobuchar’s latest legislation would do, and we shouldn’t stand for it. Not just because the bill may cost consumers $319 billion in the short term. Because we’ve already seen throughout American history what the long-term effects of antitrust look like, and they’re even worse. 

Disclaimer: Hannah is a fellow for Netchoice, which is working against Amy Klobuchar’s antitrust legislation.

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