2020 Essays

The National Security Case for Breaking Up Big Tech

Sitaraman, Ganesh

"In recent years, scholars, commentators, former tech company founders, and political leaders have made the case for breaking up and regulating big tech companies like Alphabet (the parent company of Google), Facebook, and Amazon. The proposals to break up and regulate big tech companies are specific: Unwind mergers, require tech platforms to separate from businesses that operate on the platform, regulate platforms with nondiscrimination principles drawn from public utilities and public accommodations laws, and adopt privacy regulations. Advocates for breaking up and regulating big tech hold that these companies have become a danger to the economy, society, and democracy.

Opponents of breaking up and regulating big tech have put forward a variety of responses, but among them is the assertion that breaking up big tech is problematic in an era of resurgent great power competition, particularly between the United States and China. This argument takes different forms. Some commentators have argued that the United States and China are in a Cold War­-style arms race over artificial intelligence (AI); big tech, they argue, is needed to win that contest. Alphabet’s former chief, Eric Schmidt, has thus highlighted U.S.-Chinese competition for technology in response to arguments that tech should be broken up. A second argument is that if big American tech companies are broken up and regulated, one consequence will be that the big Chinese tech companies will become dominant globally. Facebook’s Mark Zuckerberg and Sheryl Sandberg have taken this position, with Zuckerberg noting that the Chinese companies “do not share the values that we have.” Even Congressman Ro Khanna and Senator Mark Warner, who have both been critical of big tech companies, have expressed concerns along these lines, namechecking Alibaba, Baidu, and Tencent as potential global powerhouses.

The claim that breaking up and regulating big tech might have consequences for great power competition deserves to be taken seriously. The problem is that upon serious consideration, the national security case against breaking up and regulating big tech is not just weak—it is backwards. Far from being a threat to the United States, breaking up and regulating big tech are necessary to preserve America’s competitiveness, national defense, and democratic freedoms in an era of great power competition.

First, big tech companies are not competing with China in some kind of new Cold War arms race; rather, many are integrated with China, seeking to expand further into China, and cooperating with Chinese companies and (by extension) likely with the Chinese government. Big tech’s integration with China thus supports the rise and export of digital authoritarianism; deepens economic dependence that can be used as leverage against the United States in future geopolitical moments; forces companies to self-censor and contort their preferences to serve Chinese censors and officials; and makes profit-seeking corporations and their lobbyists less trustworthy in advocating for the interests of the United States in Washington, D.C. Second, in an era of great power competition, innovation and a strong defense industrial base are essential. But relying on a small number of big tech companies (and, in particular, failing to enforce antitrust laws and regulate the sector) means less competition—and that in turn means less innovation, particularly when compared with a system of robust competition and public investment in research and development. Concentration in the tech sector also weakens the defense industrial base by making the government dependent on a small number of contractors and redirecting taxpayer dollars from research to monopoly profits. Taking into account all of these dynamics, national security arguments do not favor protecting big tech companies from competition and regulation. American national security would be strengthened by breaking up and regulating big tech companies."