The stories that most interested us this week.
- The Senate approved the Republican tax bill last night following a series of last-minute amendments, paving the way for sharp tax cuts for corporations and wealthy individuals. Earlier this week,The New York Times revealed that the reason for the bill’s sketchy economic reasoning is that Treasury tax experts were reportedly shut out of the process. Also in the Times, Peter S. Goodman and Patricia Cohen explored the far-reaching impact that the $1.5-trillion bill would have on everyday life and on the American economy. HuffPost reported that several CEOs of major companies have already said they plan to use the corporate tax cut to boost stock dividends and share buybacks. The Intercept reported on the various giveaways to family members and colleagues of GOP senators included in the bill and reviewed the list of economists the administration touted as supporting the bill, which reportedly includes “ghosts, office assistants, ex-felons, and a sprinkling of real economists.”
- When Koch Industries was revealed to be the financier behind Meredith Corp.’s takeover of Time Inc., Meredith claimed that the Kochs would not interfere with editorial decisions. However, Lee Fang of The Intercept reports that Meredith already has a history of providing the Koch brothers with “stealth marketing efforts to delete critical commentary” of them and their political activities.
- Reuters reports on the ongoing legal turmoil at the Consumer Financial Protection Bureau. A Financial Times editorial outlined why the Trump administration’s actions put critical consumer protections in jeopardy.
- With Project Veritas in the news this week, BuzzFeed reporters Joseph Bernstein and Kendall Taggart reveal the role of conservative megadonor Robert Mercer in providing funding for the controversial organization.
- Does digital technology make true shareholder democracy more feasible? The Economist discusses the recent Stigler Center paper by Oliver Hart and Luigi Zingales on shareholder value vs. shareholder welfare. We’ve covered this paper extensively in ProMarket: here, here, and here.
- NYU professor and author Scott Galloway gave a fiery presentation at Business Insider’s IGNITION conference, in which he made the case for the break up for the Big Four tech platforms: Amazon, Apple, Facebook, and Google. Margrethe Vestager, the European Commissioner for Competition, appeared at Recode’s Recode Decode podcast, describing the growing power of tech platforms as “the biggest wake-up call we’ve ever had.”
Also: Watch Luigi Zingales’s recent comments on the power of large tech platforms and the dangers it presents to free speech.
- As the FCC under Ajit Pai moves on with its plans to repeal net neutrality, its Indian counterpart reaffirmed its obligation to keep the internet in India open, reports Quartz. Following whatThe Economist described as a “baffling week for competition policy in America”—in which the Department of Justice announced its opposition to the AT&T-Time Warner merger and the FCC revealed its plan to eliminate net neutrality rules—Jonathan Taplin writes about the Trump administration’s “incoherent stance on competition.”
- With its price once again over $10,000, Joseph Stiglitz says bitcoin “doesn’t serve any socially useful function” and should be outlawed.
Earlier this year, blockchain expert David Yermack gave three Stigler Center seminars on bitcoin and the implications of blockchain technology for banking, corporate finance, and monetary policy. You can also read our interview with Yermack.
Stigler Center Goings-on
On VoxEU.org, Bruno Pellegrino and Luigi Zingales write about their paper on the source of Italy’s productivity problem. You can read our coverage of the same paper here.
Disclaimer: The ProMarket blog is dedicated to discussing how competition tends to be subverted by special interests. The posts represent the opinions of their writers, not those of the University of Chicago, the Booth School of Business, or its faculty. For more information, please visit ProMarket Blog Policy.