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antitrust
Watchdog Says Trump-Backed AI Data Center Push 'Raises Massive Antitrust Concerns'
"Even if it turns out to be structured to avoid antitrust law enforcement, it plainly will concentrate power in a small number of corporate hands," said Public Citizen co-president Robert Weissman.
Jan 22, 2025
U.S. President Donald Trump on Tuesday highlighted a new private-sector initiative to invest as much as $500 billion over four years into developing infrastructure to support artificial intelligence, starting with a raft of power-intensive data centers in Texas. The move drew swift criticism from one watchdog group on antitrust and environmental grounds.
The initiative, Stargate, is a joint venture of the tech firms OpenAI, Oracle, and SoftBank. Trump hosted the leaders of those companies—OpenAI CEO Sam Altman, Oracle Chairman Larry Ellison, and SoftBank CEO Masayoshi Son—at the White House to announce the initiative just one day after he signed an executive order rolling back a Biden-era executive order implemented in 2023 that sought to put safeguards on AI.
"I think this will be the most important project of this era," said Altman, according to the Washington Post. "We wouldn't be able to do this without you, Mr. President," he added, though both the Post and and the Associated Press noted that the creation of the partnership predated Trump's return to the White House.
Biden's 2023 executive order on AI placed safety obligations on AI developers and called on federal agencies to examine the technology's risks. But Biden, too, was interested in boosting AI infrastructure development. Right before he departed, in early mid-January, Biden signed an executive order directing federal agencies to identify government sites that could be leased to private companies for the construction of AI data centers.
Environmental groups and tech advocacy groups have long advocated for greater safeguards on AI, pointing to the technology's potential impact on the climate emergency.
The average query in the AI-powered chatbot ChatGPT requires 10 times the amount of energy a Google search needs, and "in that difference lies a coming sea change in how the U.S., Europe, and the world at large will consume power—and how much that will cost," according to a 2024 analysis published by the investment firm Goldman Sachs. Goldman Sachs analysts believe that AI will represent about 19% of data center power demand by 2028.
AI infrastructure is also water intensive. Global AI demand is projected to require more water extraction in a year than the country of Denmark by 2027, according to one study.
"The alarming surge in these centers' energy demand is on track to extend the fossil fuel era... [and] it is already increasing costs for some consumers and threatens to bring about a larger affordability crisis, while lining the pockets of Big Tech billionaires," said Karen Orenstein, a director at the environmental group Friends of the Earth, following Biden's January executive order. "For the sake of our planet and its people, we need to rein in Big Tech and regulate AI," she said.
Meanwhile, the joint venture to build out AI infrastructure has also drawn scrutiny from one watchdog group over concerns of corporate concentration.
Public Citizen co-president Robert Weissman said Wednesday that "the new Stargate plan—at minimum—raises massive antitrust concerns. Even if it turns out to be structured to avoid antitrust law enforcement, it plainly will concentrate power in a small number of corporate hands."
"Absent a commitment to bring on new, renewable energy to power an even greater spike in AI power demand, the Stargate build out threatens to worsen the rush to climate catastrophe and to drive up consumer electric bills," he added.
Another observer, Jeffrey Westling of the American Action Forum, remarked on the timing of the announcement.
"Interesting to wait to announce this until the Trump Admin. Assuming its all private investment, maybe they were worried about FTC/DOJ antitrust scrutiny?" he wrote on X Tuesday.
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Trump’s Pick For AG Perfectly Exemplifies His MO—Cronyism and Corruption
Pam Bondi has a worrying history of receiving support from corporate actors before seemingly using her power to shield them from legal action.
Jan 16, 2025
In late November, President-elect Donald Trump announced Pam Bondi—former Florida attorney general, current partner at Ballard Partners, and long-time Trump-world regular—as his nominee for attorney general. Bondi perfectly exemplifies Trump’s approach to staffing the executive branch: prioritizing loyalists with a history of defending him personally and actively creating opportunities for revolver-induced corruption.
Going into the second Trump administration, the Department of Justice (DOJ) faces a broad array of issues, from counter-intelligence to civil rights enforcement. But in many respects the Justice Department is most central and critical as the enforcer of laws that limit corporate misbehavior. From monopolistic collusion and tax evasion to wage theft and polluting the air, the DOJ is constantly deciding whether to pursue potential civil and criminal actions against a wide array of corporations.
Is someone whose (virtual) rolodex is full of contacts at large tech companies likely to be enthusiastic about supporting antitrust enforcement against the very tech executives she has a warm working relationship with?
If confirmed, Bondi will be a classic corporate revolver. While at Ballard, she’s worked with a slate of corporate clients, prominently including Amazon, which has pending cases before the DOJ and Federal Trade Commission. As attorney general, Bondi would stand to oversee cases against a number of her former clients and their ilk, creating at the very least the appearance of a conflict of interest.
Bondi would also have the power to influence resource allocation decisions, determining how much effort the federal government puts toward enforcing the law against corporate actors and individuals alike. With many of Bondi and her Ballard peers’ clients and former clients number among those who stand to face federal enforcement, there are clear reasons to worry she might de-emphasize corporate misconduct and prioritize Trump’s political enemies.
Is someone whose (virtual) rolodex is full of contacts at large tech companies likely to be enthusiastic about supporting antitrust enforcement against the very tech executives she has a warm working relationship with? Questions like this seem to answer themselves, and the outlook isn’t good for those of us who see the role of government as protecting most of us from the greed and abuses of wealthy and powerful corporations and executives.
Beyond concerns about corporate revolver dynamics that could undercut DOJ’s efficacy in cracking down on corporate wrongdoing, Bondi herself has a worrying history of receiving support from corporate actors before seemingly using her power to shield them from legal action.
In 2011, newly inaugurated Florida Attorney General Bondi led the charge to fire two attorneys who had been investigating Lender Processing Services (LPS)—a mortgage services company that later pled guilty to having forged documents to illegally repossess borrowers’ homes—after Bondi received substantial campaign contributions from LPS. In 2013, Bondi directly solicited a reelection campaign donation from the Donald J. Trump Foundation. Shortly after Bondi received the $25,000 donation, her office declined to continue investigating complaints against Trump University. Also during Bondi’s first term as Florida attorney general, she had an extended relationship with lawyers from firm Dickstein Shapiro who met with Bondi to represent an array of corporate clients. In several documented cases, Bondi declined to use her AG powers to pursue action against these companies, as The New York Times reported in a Pulitzer-winning 2014 series. (As the Miami Herald reports, a brochure from the firm even boasts that “we persuaded AGs not to sue Accretive Health.”)
These corruption concerns don’t even scratch the surface of Bondi’s broad network of financial and personal relationships with conservative interest groups and influential corporate actors, not to mention her lobbying work for the nation of Qatar. As such, Bondi's confirmation would likely become quite difficult, as every issue from how to deal with Foreign Agents Registration Act enforcement to antitrust policy is implicated by her time at Ballard.
These blatant concerns with Bondi’s fitness for the role were drawn out to some extent in her first confirmation hearing on Wednesday. Bondi repeatedly took a combative tone in response to questions. She dodged or evaded numerous questions about how her loyalty to Trump might influence her decision-making as attorney general, even making the blanket statement, “I’ll never speak on a hypothetical, especially one saying that the president would do something illegal”—a concerning hard line for her to take, given Trump's multiple, non-hypothetical, criminal convictions.
Bondi’s second hearing, scheduled for on Thursday, promises to produce more eventful and contentious testimony, as hearings for Trump nominees continue this week.
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Lina Khan’s FTC Legacy Is A Lesson In Successful Progressive Leadership
Khan’s FTC has scored historic victories for consumers and workers—even as she’s faced powerful industry opposition and obstruction from right-wing judges.
Jan 09, 2025
In June 2021, just months into the Biden era, Zephyr Teachout argued that Lina Khan’s appointment to the Federal Trade Commission “may be the best thing Joe Biden has done” in office. With a firm reputation as a leader in the anti-monopoly movement, her nomination to the FTC was a clear victory for progressives in an administration otherwise primarily staffed by moderates.
Three years on, it’s clear that this optimistic outlook about a Khan-run FTC has been vindicated. In her position, Khan’s FTC has scored historic victories for consumers and workers—even as she’s faced powerful industry opposition and obstruction from right-wing judges.
Understanding the significance of Khan’s tenure means understanding how antitrust enforcement has been sabotaged in recent decades by right-wing ideologues. The federal government adopted antitrust laws beginning in 1890, which would become a crucial tool for reining in corporate abuses for decades to come. But beginning in the 1970s, federal courts would embrace a right-wing reimagining of antitrust law under the guise of promoting “consumer welfare.” Unsurprisingly, this hands-off approach helped create an economy defined by extreme corporate concentration, leading to fewer and worse choices for American consumers.
While the leadership of both agencies are set to change under President-elect Donald Trump, the new merger guidelines mean that Khan’s pro-competition vision will help shape FTC decision-making well past her tenure.
While still in law school, Khan rose to prominence in 2017 for her critique of laissez-faire antitrust enforcement. Given her reputation, observers were quick to speculate on how she’d be able to put her principles to action at the FTC. For one, the commission in recent decades has built a track record of being deferential to the very monopolies it’s tasked to regulate. Additionally, the commission has long suffered from inadequate funding, which has hindered its capacity to police monopolies. But despite these institutional constraints, Khan’s FTC has secured major wins for American consumers, all while facing down hostile corporate actors and their allies in the judiciary.
Monopolistic behavior in the food industry over the past few decades has robbed consumers of choice while increasing grocery costs. Two years ago, grocery giants Kroger and Albertsons announced a massive merger deal that quickly raised alarms among consumer advocates. While such a merger may have gone through unscathed a decade or so prior, the Khan-led FTC filed suit to block the deal. Last month, the FTC won one of its biggest victories in recent years by blocking the merger in court. This victory, along with the FTC’s successful effort to block Tapestry’s acquisition of Capri, shows that Khan’s view of antitrust is increasingly finding support in court.
Sharing jurisdiction on antitrust matters with the Department of Justice (DOJ) Antitrust Division, the two agencies successfully modernized merger guidelines to help identify illegal mergers in their tracks. Observers have credited both the FTC and DOJ Antitrust Division’s aggressive enforcement efforts with a recent decline in merger efforts. And while the leadership of both agencies are set to change under President-elect Donald Trump, the new merger guidelines mean that Khan’s pro-competition vision will help shape FTC decision-making well past her tenure.
These developments, of course, only scrape the surface of the FTC’s accomplishments under Khan. The commission notably blocked an effort by Nvidia to acquire Arm, which was set to be the biggest merger deal in semiconductor industry history. The ultimate failure of Amazon to acquire iRobot, which caused concern among various international antitrust regulators, has been at least partially credited to the FTC’s scrutiny. Among the most meaningful impact of renewed FTC antitrust scrutiny may be felt on private equity firms, a welcome development given said firms’ harms to competition and American society at large.
The Khan-led FTC’s ability to build bipartisan support for efforts such as recent rulemaking on junk fees, as well as on merger guidelines, should be seen as a model for Democratic governance. Moreover, the Khan-led FTC should be applauded for using long-neglected tools at the commission’s disposal, such as its ability to police price discrimination as interlocking directorates.
With Khan set to be succeeded by Andrew Ferguson, Trump’s pick to lead the FTC, it's likely that the FTC will soon shift its approach on antitrust and consumer protection. Nevertheless, it’s clear that Khan will leave behind a legacy that will influence antitrust enforcement for decades to come. And in doing so, Khan will also leave behind a track record that shows what successful progressive governance looks like.
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