Senators turn up the heat on Amazon, data brokers during hearing
Sen. Elizabeth Warren (D-Mass.) spearheaded attacks at e-commerce giant Amazon during a hearing on data privacy and competition Tuesday, while other senators on the panel voiced concerns over data brokers harvesting user information.
Warren, chair of the Subcommittee on Fiscal Responsibility and Economic Growth, centered her time on accusations that market power of tech giants is driving up prices and creating inhumane conditions for workers. But ranking member Bill Cassidy (R-La.) and other Democrats focused largely on data privacy concerns.
The broad scope of the hearing and lawmakers’ questions indicated that although senators are fairly united about general criticism of Amazon and other tech giants, there is still a deep divide on how to approach regulation.
“The United States is at an inflection point. Wealth and income disparities are at levels we have not seen in our lifetimes. The government’s lax enforcement of antitrust laws during the past few decades is a huge part of this problem; regulators and judges have allowed merger after merger and the result is too little competition in U.S. markets,” Warren said.
“Dominant firms in technology are free pretty much to do as they please, including on data collection. They raise prices, they reduce wages, they threaten our privacy — all so that they can boost their profits to their shareholders and make their CEOs richer.”
Amazon was squarely in focus at the hearing with D.C. Attorney General Karl Racine (D), who is conducting an antitrust lawsuit against Amazon, and an Amazon associate who was present Tuesday among the panel of witnesses.
Racine’s lawsuit against Amazon focuses on the company’s treatment of both third and first-party sellers on the platform. The complaint alleges the company has locked first-party sellers into anti-competitive agreements, as well as imposed excessive fees on third-party sellers that result in higher prices and less choice for consumers.
“Look at it as a toll booth keeper. If the road only leads to the tollbooth, the tollbooth keeper can raise those prices and you as the driver have no choice but to pay whatever they are asking if you’re trying to get down that road. We think that’s illegal. We appreciate the work of this great committee, we’re going to make law in the courts and we look forward to helping with prospective legislation,” Racine said.
Courtenay Brown, the associate at an Amazon fulfillment center in New Jersey, testified about the harsh working conditions at the site. When asked by Warren if there are alternative employment options for her and her colleagues, Brown said there are limited choices in other warehouse or retail positions.
“Amazon pays just a bit more than them, so we’re stuck being taken advantage of in warehouses like this and this is what they bank on. They know we have no other choice so they continue with the lack of regulation and everything to protect us,” Brown said.
A spokesperson for Amazon did not respond to a request for comment. The company has previously pushed back on the allegations in Racine’s lawsuit and has defended its treatment of workers.
Other senators on the panel didn’t voice opposition to Warren’s calls for revamping antitrust laws, but rather, they focused their time during the hearing on witnesses with expertise in data privacy.
Cassidy, a former physician, asked Justin Sherman, a data researcher at Duke University, about concerns that data brokers can infer information about a person’s medical information or diagnoses using data such as location status. For example, data brokers may infer a person is diagnosed with a mental illness if they appear routinely at a certain treatment center or clinic.
“That’s exactly the problem with data brokers, senator,” Sherman said. “They can basically dance around the very few, very limited privacy laws we do have by proxy data, and run algorithms to get that information anyway.”
That information can then be sold to market products to users based on the collected data, he added.
Sen. Ron Wyden (D-Ore.) also centered his time on data privacy, but noted that economic issues are intertwined with privacy concerns.
“Privacy is a massive economic and national security issue and you can’t just separate these all out into separate boxes. This question of economics and national security and privacy are directly linked,” he said.
Stacey Gray, senior counsel at Future of Privacy Forum, said the “sheer scale and volume” in the modern commercial data ecosystem has made it “increasingly untenable” to separate related fields of law enforcement and national security uses of data and commercial uses and collections of data.
The lack of questions on competition from other senators during the hearing, however, may be a signal of the rough road ahead for proposals to revamp antitrust laws.
Warren has been a big proponent of overhauling antitrust laws and giving regulators greater power to tackle the biggest tech companies. As a presidential candidate, breaking up tech giants was a cornerstone of her campaign.
There are a handful of proposals in the Senate aimed at revamping antitrust measures, and the Senate Judiciary Antitrust Subcommittee chaired by Sen. Amy Klobuchar (D-Minn.) has held numerous hearings on the topic.
These proposals have garnered some bipartisan support, but lack the widespread backing to push them forward. In the House, a package of bills that advanced out of the Judiciary Committee in June has stalled due to opposition on both sides of the aisle. These bills mirror some of the Senate proposals.