Private Power, Public Values: Regulating Social Infrastructure in a Changing Economy
73 Pages Posted: 15 Jun 2017
Date Written: June 14, 2017
From the renewed controversies over financial regulation and the problem of too-big-to-fail (TBTF) financial firms, to the clash over the FCC’s ‘net neutrality’ regulations on internet service providers, and more recent questions about Google, Facebook, and online platforms, we are in the midst of a larger policy and political debate about how to regulate modern-day forms of private power. Encompassing different areas of law and policy, the underlying issue in this debate is the following: how should we conceptualize and regulate new forms of concentrated private power, particularly when these firms control the terms of access to vital services — such as finance, broadband internet, or information — upon which many communities, constituencies, and economic actors depend? Drawing on historical Progressive Era concepts of private power and public utility, as well as current debates in financial regulation and net neutrality, this article provides an overarching framework to answer that question.
First, the article argues that what makes firms like TBTF financial giants and internet service providers distinct is that they represent a form of private control over ‘infrastructural’ goods — goods that comprise a backbone for much of modern social and economic activity, upon which many communities and constituencies depend. Second, the article identifies three key elements of a 21st century framework for public utility regulation designed to remedy this problem of private control of infrastructural goods: firewalling; imposing public obligations; and creating public options. Third, the paper, applies these principles to the emergent debates over private power and infrastructure in context of internet platforms helps demonstrate their importance, shedding new light on how to address the myriad of concerns raised by new technology giants like Google, Amazon, or Uber. These public utility concepts offer a portable, trans-substantive legal and policy framework for understanding and contesting private power in a variety of sectors. Fourth, this approach also adds an important missing complement to our current legal frameworks and literatures on the problem of private power in the 21st century, particularly by reorienting business law and economic policy back towards a focus on the problems of power and inequality. Moreover, these concepts help bridge the growing literature diagnosing the legal construction of inequality with the aspiration to develop mechanisms that can undo widespread structural disparities of economic opportunity, welfare, and power.
Keywords: Private Power, Democracy, Progressive Era, Financial Regulation, Net Neutrality, Internet Platforms, Infrastructure
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