When Apple’s CEO Tim Cook says “the free market is not working,” bad things are coming.
One of the most remarkable statements ever made by the CEO of a major corporation generated relatively little notice or pushback. But just a couple of weeks ago, there was Tim Cook, the head of Apple, spitting in the eye of the very economy that made his company the highest valued corporation on the planet.
“I am not a big fan of regulation,” Cook told Axios in an interview. “I’m a big believer in the free market. But we have to admit when the free market is not working. And it hasn’t worked here. I think it’s inevitable that there will be some level of regulation… I think the Congress and the administration at some point will pass something.”
Holy hell! Regulation of the tech industry and the larger economy (both of which are already pretty heavily regulated, if we’re being honest) is inevitable? The free market isn’t working? Well, maybe not quite as well as it used to for Apple, which been a little droopy over the past several years in terms of killer new devices and mega-hits. Right around the time Cook was prophesying, Microsoft and Amazon both could lay at least temporary claims to be more valuable. Maybe in that sense the free market isn’t working so great anymore… for Apple. But come on already. Factor in the housing bust from a decade ago, the Great Recession, mall closings, the opioid epidemic, and whatever else you want to, and any semi-serious analysis is going to conclude that over the last few decades, “The living standards of Americans have vastly improved during the past 50 years, with the quality of available consumer products steadily rising even as their prices have steeply fallen.”
And it’s not just Americans, of course. Just a week before it ran its dour interview with Tim Cook, Axios reportedly cheerily that “half the world is now middle class.” The world is becoming more equal, not less. So two cheers for capitalism (for more on how income mobility and broad-based economic gains are the rule and not the exception in America too, go here for starters).
But the facts on the ground—however disputed they might be—are irrelevant when titans of industry, such as Cook, declare that “the free market is not working” and that regulation is “inevitable.” His opinion carries more weight than yours or mine. And he’s not alone. Earlier this year, Facebook’s Mark Zuckerberg embraced increased government control in anticipation of sitting down before Congress. “The question is more what is the right regulation rather than ‘yes or no should we be regulated?’” he told Wired.
When actually talking to Congress, Zuck even volunteered to help write the regulations, while noting that the more Facebook and social media are regulated, the less likely it is that a rival will emerge. But hey, that’s an outcome he and Congress were willing to live with. Conservative Republicans want Facebook to do more to spread content they like (Ted Cruz does love him some Diamond and Silk!) and Democrats want to make sure that the next time Hillary Clinton runs for president she loses simply because she ran the worst campaign of all time, not because of whatever Facebook did to screw her over. In more recent hearings (which came on the heels of yet more revelations of Facebook’s weak record of protecting user data and whatnot) Zuckerberg’s colleague Sheryl Sandberg and Twitter’s Jack Dorsey reiterated their willingness to jump on various bipartisan regulatory bandwagons.
The same consensus is visible in elite opinion, too. The Columbia Law professor Tim Wu, who popularized the concept that eventually became a short-lived law known as “Net Neutrality,” has a new book out called The Curse of Bigness: Antitrust in the New Gilded Age. In it, he calls for the breakup of what are known as the FAANG companies, tech giants such as Facebook, Apple, Amazon, Netflix, and Google, who he says wield too much market power. Like Cook, he sees regulation as inevitable but actually worries the government won’t do enough to really bust up the companies. In an interview with Publishers Weekly, he said:
[I] think that companies like Google and Facebook have come to hold too much power. There’s a growing sense that they have too much control over information, news, advertising, even who we are and what’s going on. I’m actually most concerned that we’ll cut some kind of deal that effectively nationalizes or weakly regulates Facebook. and that that deal will endure for a long time. That’s the trajectory we’re on, and I would resist that.