On Monday, the US Supreme Court heard a significant case that challenges some of the fundamental ideas that have guided the American economic order for the last fifty years.
The case, known as ‘NetChoice v. Paxton’, raises the question of whether the First Amendment prohibits economic regulation of technology platforms such as Google, Meta, Amazon, and TikTok under the guise of ‘free speech’.
NetChoice functions as a trade association for online businesses. NetChoice’s members include Amazon, Google, Lyft, Meta, Nextdoor, PayPal, Snap, TikTok, Verisign, Waymo, and X. The list of members comprises some of the biggest names in the tech industry.
NetChoice and its financial resources
NetChoice is a lobbying group funded by Google, Facebook, Amazon and TikTok. It primarily sues against public rules designed to restrict such companies.
Its budget is huge, accounting for about 15% of the entire Anti-Monopoly department of the federal government.
NetChoice immediately sued to block the law, as well as a similar law in Florida. Initially, the big tech firms attempted to frame the case as a ‘partisan fight’ by claiming that Texas was defending political conservatives against them.
However, this argument failed as there are other laws, such as California’s ‘California Age Appropriate Design Code Act’, which NetChoice sued to block.
Summary of cases
In 2021, Florida and Texas passed laws mandating that social media platforms with over 50 million American users cannot discriminate against users based on their viewpoint. These laws were a clear reaction to Donald Trump’s expulsion from Twitter and Facebook.
In 2021, the two technology groups challenged the Florida law in federal court. The district court blocked enforcement of the injunction and determined that it likely violated the First Amendment. The US Court of Appeals for the 11th Circuit sided with the trade groups after Florida appealed the decision.
The outcome of the case will have a direct impact on the multi-trillion dollar market, with potential political and social consequences in the US. Big Tech firms face claims related to anti-monopoly, privacy rights, civil rights, and free speech issues. Congress and state legislatures are taking action to address ‘surveillance advertising’ and the exploitation of children by these companies.
This case may disrupt counter-political moves as Big Tech companies’ lawyers claim that the US Constitution does not allow elected officials to interfere with private technology platforms, even when their decisions have significant societal consequences.The case has raised interesting and bizarre questions as arguments unfolded. For instance, Facebook’s lawyer, Paul Clement, argues that the company has the First Amendment right to discriminate racially or religiously in its services or to create services that addict children.
Similarly, Google’s lawyer confirms that the company can delete Tucker Carlson or Rachel Maddow’s Gmail account due to political disagreement.
During a discussion, Judge Neil Gorsuch inquired about the ability of technology companies, such as Gmail, to delete emails and private direct messages that contain sensitive topics like race, politics, and religion. Clement responded that the decision would depend on the application of the ‘equal protection’ clause, but also noted that this issue involves editorial judgments.
Big Tech received support from a variety of third parties, including the ACLU, privacy law professors, companies like Etsy, historians, civil rights groups, the US Chamber of Commerce, and national security experts such as General Stanley McChrystal.
The judges are uncertain
It is yet to be determined how the Supreme Court judges, who are hearing the case, will address the issue of ‘freedom of expression’.
Judge Gorsuch, for instance, inquired whether ‘algorithms specifically designed to lure young people into addiction or suicide, depression and that sort of thing’ are covered by freedom of expression and can, therefore, be regulated by the state.
Counsel Clement responded that the state could not regulate them.During the hearing, Judge Barrett inquired about the possibility of big tech companies banning users based on their religion.The response was affirmative, indicating that if Google wished to restrict its platform to only Catholics, it would have the right under the First Amendment to exclude Protestants from a Catholic gathering.
Jim Crow in anti-regulation
The argument that technology companies should not be regulated because the government cannot interfere can be traced back to the Civil Rights movement in the US and the conservative reaction to it.
This is reminiscent of the opposition to the 1964 Civil Rights Act and the views of Robert Bork, the Yale University law professor who opposed it. The new case has brought these issues to the forefront once again. Bork judged that racial discrimination could be defended as long as it was ‘privatised’ in relation to the civil rights movement’s struggle against it.His article in The New Republic defending racial segregation was highly controversial. The descendants of Southern slave owners expressed their satisfaction, with a South Carolina banker even writing to Bork that it was ‘very encouraging for them to have a Goldwater man at Yale’.Barry Goldwater was a conservative senator from Arizona.
The editors of The New Republic argued against Bork’s legal opinions. Private property owners have always been able to conduct their affairs within certain public impositions. For example, under English common law, an innkeeper was obliged to admit all customers, provided they were sober and regular. Southern businesses in the US and Bork were abusing private property law and demanding exemption from public obligations. The vocabulary is accessible, and the grammar, spelling, and punctuation are correct.
Bork did not defend racism in his article; he found it ‘abhorrent’. However, he believed that the state should not dictate the terms on which businessmen use their private property. The text is now structured logically, with short and simple sentences in the active voice. No changes in content were made.
Southern property rights combined with neoliberal financialisation
In effect, the Yale professor was echoing the arguments of slavery advocates on both sides of the Atlantic during the American Civil War. Southern slave owners and their supporters argued that their slaves were their private property and that state interference in private property was contrary to the fundamental principle of liberalism.
Although the abolitionist Northern republicans won the American Civil War, a compromise was made with the South immediately after the war, giving white landowners there the right to practice racial segregation. These laws, known as the ‘Jim Crow laws’, reinforced racial segregation in the South, with blacks, for example, no longer allowed to enter buses or hotels with whites.
The origin of the term ‘Jim Crow’ is attributed to ‘Jump Jim Crow’, a black-faced song and dance character first created in 1828 by white actor Thomas D. Rice. As a result of Rice’s fame, Jim Crow had become a pejorative expression meaning ‘Negro’ by 1838. When Southern legislatures passed racial discrimination laws against African Americans at the end of the 19th century, these laws became known as the ‘Jim Crow laws’.
Although racial segregation was ended at the federal level in 1964, these arguments continued to have a strong political impact. The South had always favoured civil service rules and anti-monopoly rules because Southerners saw these legal instruments as checks on the overwhelming power of Northern capital.
In the 1960s, Bork opposed anti-monopoly laws that protected small firms against large corporations. He argued that these laws were ‘inefficient’ and harmful to consumers. Large corporations cherished Bork after his article in Fortune magazine, and he gained access to ‘research’ funds with attractive fees.
During the neoliberal era, the trend towards deregulation led to the politicisation of small anti-monopoly corporations and white Southern property owners on an ‘anti-state interventionist’ platform. These groups aligned with the deregulatory aspirations of the era’s hyper-financialisation.
Interestingly, Bork’s theses also influenced the liberal left. Bork believed in economic specialisation and concentration of capital, but he was against populism and small businesses. He viewed monopolies’ price controls as their property rights and a matter of consumer rights.
As a result, he supported all forms of price controls except those based on gender and racial discrimination. The case before the Supreme Court may clarify whether there are any obstacles to this. Bork’s anti-Civil Rights and pro-monopoly reasoning in Big Tech’s defence is easily traceable.
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