Every Now and Then You Win One

Eakinomics: Every Now and Then You Win One A theme of the Biden era has been the government running roughshod over citizens’ hopes, dreams, and preferences. Progressives dictate lifestyles, cancel dissenters’ opinions, and stifle debate. The government regulates without restraint, moves control to the public sector, and defies the private sector to grow in an environment of crippling red tape and bloated government. And the competition regulators openly discard the objective of enhancing consumer welfare in favor of an agenda of political payback and playing favorites. But every now and then the good guys win one. As AAF’s Jeff Westling put it: “In April, the 9th Circuit Court of Appeals decided that Apple’s iPhone and application store practices – which limit users to applications offered through Apple’s App Store and charge a 30 percent commission on sales – didn’t violate antitrust law, adhering largely to the consumer-centric analysis of modern antitrust law. As the court explained, Apple had important, pro-competitive reasons for its practices, such as enhanced cybersecurity, and consumers had the choice to use these products and services.” That’s right, Apple can do the things that it does – pricing and restricting access to its app store – because it does business the old-fashioned way and gives the customer what they want. Having said that, there is nothing to stop Congress from meddling anyway. In particular, a bipartisan group of senators introduced the Open App Markets Act (OAMA) in the last Congress. It would require firms like Apple to allow access to mobile operating systems without going through the operating system’s own application store. With the 9th Circuit’s condoning of Apple’s conduct in the mobile application space, a renewed push to regulate the market could arise. This kind of access to the operating system opens up a host of cybersecurity concerns, but Congress could simply choose to dismiss the procompetitive benefits of closed systems and make the determination to move ahead. In short, it’s a good day for those appreciative of the power of market forces, but a host of threats remain.