Winter is coming for Silicon Valley monopolists

"Winter is Coming" for Silicon Valley monopolists, who long ago moved from innovation to mining government regulatory relationships to crush competition and maximize profits.

As eloquently stated in The Myth of Capitalism regarding political clout, "Government is not a passive bystander in the increase in inequality, it is an active participant, granting favors to the wealthy and powerful, looking after the interests of the well connected."

Silicon Valley is often credited with escaping the pain from the Great Recession's brutal real estate crash and huge unemployment spike due its ability to innovate with the triple roll-out of the iPhone, social media, and the internet advertising model.

But another huge financial driver for America's largest technology hub was the return on investment during Barack Obama's administration from an 800-percent increase in annual lobbying expenditures, from $17.8 million in 2008 to $139.5 million in 2016, that seems to have convinced the president and congressional Democrats to embrace Silicon Valley's business model that directly profited from expanded global trade, offshoring U.S. jobs, and importing skilled workers.

With regulators ignoring Silicon Valley tech giants offshoring most of their manufacturing operations, the annual U.S. trade balance for advanced technology products sales fell from a $35-billion surplus in 1992 to an $111-billion deficit when Obama left in 2017.

Once inspired by breakthrough research from Stanford and U.C. Berkeley, Silicon Valley growth is now tied to market concentration from companies like Alphabet (GOOGL), which has made 120 acquisitions, and Oracle Corp. (ORCL), which bought 80 firms.  Facebook maintained its 70-percent social media market share by paying $17 billion to buy its top potential competitors, Instagram and WhatsApp.

As I reported in a 2015 article titled "Net Neutrality Passes: Everybody Equal, But Google Much More Equal," Obama appointees on the Federal Communications Commission added edits written by Google, then voted to approve a wildly controversial scheme to intensively regulate and tax the internet, like the AT&T telephone monopoly.

Nowhere was the Obama administration kinder to powerful corporate elites than in dismantling U.S. antitrust enforcement of the Sherman, Clayton, and Federal Trade Commission Acts.  According to FTC data, Obama administration antitrust enforcements were less than in the Bush administration and about one third of Clinton filings.

The bipartisan Center for Responsive Politics that tracks the influence of Silicon Valley money on American elections and government bureaucrats' actions commented, "Just as water flows downhill, money in politics flows to where the power is."

The combined 2016 market value of Facebook, Apple, Amazon, Netflix, and Google ("FAANG stocks") accounted for almost $3 trillion in market capitalization.  Despite going all in to support a losing 2016 presidential effort by Democrat Hillary Clinton, FAANG's market momentum saw their value reach almost $4 trillion in early 2018, or about 11 percent of the value of all 500 of the most valuable American companies. 

But Trump through 2018 dismantled $33 billion of the $245 billion in burdensome regulations imposed during the Obama administration.  The U.S. Office of Budget and Management reported that the administration eliminated or delayed 2,253 regulatory actions, including "Net Neutrality" and the U.S. Post Office subsidy for Chinese shippers.

Although liberal judges have slowed down recension of thousands of other targeted regulations, President Trump is radically reshaping the federal courts by confirming two associate justices of the Supreme Court, 40 judges for the United States courts of appeals, and 64 judges for the United States district courts.  The president currently has 57 nominations pending in the U.S. Senate, including three for the courts of appeals, 52 for the district courts, and two for the Court of International Trade.

Americans generally understand that Facebook, Alphabet (Google's parent), and Amazon are monopolies that probably violate antitrust laws.  They would not be surprised to learn that the European Union is pursuing an antitrust action against Google's search dominance and the U.S. Trade Commission is completing a $5-billion settlement for illegally violating consumer privacy.

Supreme Court justice Brett Kavanaugh, who was crucified by Silicon Valley elites during his Senate confirmation hearings last year, just became the swing vote that found that Apple's App Store can now be sued by consumers for antitrust actions.

Silicon Valley's corporate Masters of the Universe must feel like the great families of Westeros who uttered the dreaded "winter is coming" in Game of Thrones.  The ultimate winner of the Iron Throne after eight years of conflict will be declared in Sunday night's final episode.  But a long and painful "winter is coming" for Silicon Valley.

"Winter is Coming" for Silicon Valley monopolists, who long ago moved from innovation to mining government regulatory relationships to crush competition and maximize profits.

As eloquently stated in The Myth of Capitalism regarding political clout, "Government is not a passive bystander in the increase in inequality, it is an active participant, granting favors to the wealthy and powerful, looking after the interests of the well connected."

Silicon Valley is often credited with escaping the pain from the Great Recession's brutal real estate crash and huge unemployment spike due its ability to innovate with the triple roll-out of the iPhone, social media, and the internet advertising model.

But another huge financial driver for America's largest technology hub was the return on investment during Barack Obama's administration from an 800-percent increase in annual lobbying expenditures, from $17.8 million in 2008 to $139.5 million in 2016, that seems to have convinced the president and congressional Democrats to embrace Silicon Valley's business model that directly profited from expanded global trade, offshoring U.S. jobs, and importing skilled workers.

With regulators ignoring Silicon Valley tech giants offshoring most of their manufacturing operations, the annual U.S. trade balance for advanced technology products sales fell from a $35-billion surplus in 1992 to an $111-billion deficit when Obama left in 2017.

Once inspired by breakthrough research from Stanford and U.C. Berkeley, Silicon Valley growth is now tied to market concentration from companies like Alphabet (GOOGL), which has made 120 acquisitions, and Oracle Corp. (ORCL), which bought 80 firms.  Facebook maintained its 70-percent social media market share by paying $17 billion to buy its top potential competitors, Instagram and WhatsApp.

As I reported in a 2015 article titled "Net Neutrality Passes: Everybody Equal, But Google Much More Equal," Obama appointees on the Federal Communications Commission added edits written by Google, then voted to approve a wildly controversial scheme to intensively regulate and tax the internet, like the AT&T telephone monopoly.

Nowhere was the Obama administration kinder to powerful corporate elites than in dismantling U.S. antitrust enforcement of the Sherman, Clayton, and Federal Trade Commission Acts.  According to FTC data, Obama administration antitrust enforcements were less than in the Bush administration and about one third of Clinton filings.

The bipartisan Center for Responsive Politics that tracks the influence of Silicon Valley money on American elections and government bureaucrats' actions commented, "Just as water flows downhill, money in politics flows to where the power is."

The combined 2016 market value of Facebook, Apple, Amazon, Netflix, and Google ("FAANG stocks") accounted for almost $3 trillion in market capitalization.  Despite going all in to support a losing 2016 presidential effort by Democrat Hillary Clinton, FAANG's market momentum saw their value reach almost $4 trillion in early 2018, or about 11 percent of the value of all 500 of the most valuable American companies. 

But Trump through 2018 dismantled $33 billion of the $245 billion in burdensome regulations imposed during the Obama administration.  The U.S. Office of Budget and Management reported that the administration eliminated or delayed 2,253 regulatory actions, including "Net Neutrality" and the U.S. Post Office subsidy for Chinese shippers.

Although liberal judges have slowed down recension of thousands of other targeted regulations, President Trump is radically reshaping the federal courts by confirming two associate justices of the Supreme Court, 40 judges for the United States courts of appeals, and 64 judges for the United States district courts.  The president currently has 57 nominations pending in the U.S. Senate, including three for the courts of appeals, 52 for the district courts, and two for the Court of International Trade.

Americans generally understand that Facebook, Alphabet (Google's parent), and Amazon are monopolies that probably violate antitrust laws.  They would not be surprised to learn that the European Union is pursuing an antitrust action against Google's search dominance and the U.S. Trade Commission is completing a $5-billion settlement for illegally violating consumer privacy.

Supreme Court justice Brett Kavanaugh, who was crucified by Silicon Valley elites during his Senate confirmation hearings last year, just became the swing vote that found that Apple's App Store can now be sued by consumers for antitrust actions.

Silicon Valley's corporate Masters of the Universe must feel like the great families of Westeros who uttered the dreaded "winter is coming" in Game of Thrones.  The ultimate winner of the Iron Throne after eight years of conflict will be declared in Sunday night's final episode.  But a long and painful "winter is coming" for Silicon Valley.