Years of bi-partisan frustration with Big Tech have culminated this past month with the House Judiciary Committee’s report on the threat of Big Tech’s Monopolization. While the Democrats call for strong anti-trust regulation, Republicans prefer “targeted anti-trust enforcement” that allows the free market to take the reins. Both sides are getting this wrong. Republicans completely misunderstand monopolies, while Democrats seriously need to broaden their targets outside of Big Tech.

How do Republicans get monopolies wrong? Take, for example, conservative wunderkind Ben Shapiro’s opinion on anti-trust, where he argues that unless a firm owns a full 100%, it isn’t a true monopoly and therefore not a problem. If, like Shapiro, you’ve only taken an Economics 101 class, this seems true. However, a basic analysis of how anti-trust law works shows that when we talk about monopolies, we don’t mean a literal monopoly, but rather “a firm with significant and durable market power…the long term ability to raise price or exclude competitors.” Because even without total control of a market, a firm can still harm the economy and consumers. A great example of this in practice is the 1962  Brown Shoe Co. v United States ruling, which prohibited a merger between two  shoe companies that would have given them just six percent of the footwear market, because the court believed it would have been anti-competitive.

As the comments of Jim Jordan and three other Judiciary Committee Republicans show, conservatives are also wrong on the impact of monopoly. One of their primary complaints against Big Tech monopolies wasn’t the inequalities they cause, but rather that these tech giants are censoring conservative voices. This is a claim that has not only been debunked by data, but has been thrown out of courts eight times in the past two years alone due to lack of evidence. When fighting monopolies, these are not the sins Congress should be investigating.

So why are monopolies a problem? It’s simple; the effects of firms controlling large shares of their market has led to decades of exacerbating inequality. To get a sense of how the economy has shifted towards monopolization, look no further than the decline of small businesses. A 2016 study found that between 1997 and 2012, local retailers declined by 40 percent, a reduction of 108,000 businesses. In the 1980’s these retailers supplied half the goods in the nation, yet they now supply just a quarter. At the very same time, corporate consolidation has skyrocketed. Research by the American Economic Liberties Project shows that just 28 corporations own 1,353 of the most common brands, from glasses, to food/drinks, personal hygiene, hotels, beer, and more.

But so what? Consumers may not have perfect freedom of choice, that’s just the free market at work, right? Who does it hurt?  Right off the bat, monopolies lead to higher prices, so it hurts the consumers. Then there’s the tens of thousands of small businesses owners (and all potential future entrepreneurs) who are out of business. And finally, monopolization is devastating for workers. Contrary to the popular notion of free choice in the marketplace, under monopolization workers often do not have the choice to work somewhere else if they are not satisfied. This is because market consolidation has led to 1 in 5 workers being bound by non-compete clauses, meaning they cannot work for a competitor after leaving a job. There’s also the stifling effect monopolies have had on economic growth for decades. Due to a lack of competition, employment has been 5-18% less than it should have been. Labor’s share of economic output is 10-23% lower than it should be, which means wages have been lower. While the median annual compensation in 2018 was $30,500, in a competitive market it could have been $41,000 or even as high as $92,000.

Think about the implications for inequality. What if the millions of unemployed had had jobs? If low-wage workers had been making at least $10,500 more every year? If they weren’t paying more for products despite having less money? If 108,000 small businesses didn’t go out of business, creating hundreds of thousands of jobs? This is the world that would exist had we a truly free market, not one dominated by monopolies. And this world is possible. But the legislative action needed to save the economy is not fining corporations when they are caught doing bad things. We need anti-trust laws that reverse market consolidation to make it less likely that corporations can do wrong in the first place.

Max Deutsch is a senior at Hunter College, majoring in Political Science with a certificate in Public Policy. At Hunter, he is in the Thomas Hunter Honors Programs and is a Muse Honors Scholar. Politically, he is heavily invested in pursuing strong social democratic policies on the federal level, specifically in regards to the power held by corporate America. Which is why his public policy capstone is focused on using anti-trust law to regulate the new monopolies of the Gig Economy. He is also very interested in the prominence of conservative pseudo-intellectuals, and he recently started his own podcast, Another Progressive Podcast, to combat the narratives espoused by these commentators. After graduation, he hopes to work in policy making or for politicians, and eventually attend graduate school to get a masters degree in Public Policy.