She built an agency to protect consumers from Big Banking. Now she wants to create a new one to protect us from Big Tech.
Stop me if you’ve heard this one before: Sen. Elizabeth Warren has an idea for a new federal agency that takes on some of the most powerful and valuable companies in the world, aiming to protect consumers from their abusive business practices.
You’d be forgiven for assuming I’m referring to the Consumer Financial Protection Bureau, the federal agency that Warren is largely and deservedly credited with creating. No, this is about a new bill that would create another new agency: the Digital Consumer Protection Commission Act, or DCPC. Whereas the CFPB took on Big Banking, the DCPC aims to take on Big Tech, with a dedicated and specialized agency empowered to promulgate and enforce new regulations. Warren believes it will address some of Big Tech’s greatest harms, which the US has thus far failed to rein in any other way.
“Big Tech giants exploit people’s data, invade Americans’ privacy, and crush competition,” Warren told me in an interview. “The tech industry has shut down every attempt to regulate it or impose liability on it.” She added: “Enough is enough. We cannot let a handful of unelected Big Tech billionaires govern our lives and govern our democracy.”
Warren’s push for another new agency comes as we’re seeing what appears to be plenty of justification for its existence. Digital privacy and Big Tech-focused antitrust bills have largely fizzled out, despite bipartisan support for them. Congress is currently mulling over bills about online children’s safety and TikTok as a potential national security threat that may never get close to passing. On the rare occasions when these companies are held to account, even the largest fines levied against them are little more than rounding errors, easily shrugged off as the cost of doing business.
We’re also seeing what may be the limits of what our existing agencies can do. The FTC’s attempt to block Microsoft’s acquisition of video game giant Activision was recently defeated in court. The Department of Justice’s antitrust trial against Google over its search engine dominance just began, kicking off a wave of Big Tech antitrust lawsuits that will test if and how existing antitrust laws can be applied to these digital platforms. If they can’t, perhaps that will finally make the case for a new agency that can.
“People get what’s wrong. And they also get that Congress is not responding,” Warren said, adding: “Congress is slow and deliberative. The agencies can be more nimble. But to do that, they need expertise.”
This isn’t the first bill to propose a separate agency to regulate Big Tech platforms. Sens. Michael Bennet (D-CO) and Peter Welch (D-VT) introduced one in May, called the Digital Platform Commission Act. Taken together, the two bills show a growing realization in Congress that the existing legislation and agencies aren’t enough to regulate Big Tech, and that it’s time to try something else.
It won’t be easy, to say the least, to create an agency in the face of Big Tech’s lobbying money and influence, Republican lawmakers’ general aversion to regulations and federal agencies, and the reluctance of some Democrats to regulate and possibly impede the progress of such an important industry, especially when it’s rooted in their home states.
But Warren’s bill has two things that Bennet and Welch’s bill does not. First, it’s bipartisan, with Sen. Lindsey Graham (R-SC) — of all people! — as a cosponsor. Second, it has Warren, who is one of few people who can say she’s created a federal agency before.
Can she do it again?
Elizabeth Warren’s first consumer protection agency
Most of us know who Warren is because of the CFPB. She spelled out her idea for it in 2007, believing that Americans needed an agency that looked out for their best interests when it came to financial products — think credit cards, car loans, and mortgages — as the Consumer Product Safety Commission did for things like car seats, toys, and treadmills.
The financial crisis made the case that such an agency was needed and got the necessary political will behind it. The Dodd-Frank Act created the CFPB in 2010. Over the next year, Warren was charged with establishing and leading the agency as an adviser to the Obama administration. After being passed up to be the CFPB’s official director, she went back to her home state of Massachusetts and ran for Senate. Spoiler alert: She won. Now she’s in a position to help create a new agency and take on another consumer protection issue.
“She was pivotal to both the creation of the CFPB and to making it real,” said Raj Date, who was the agency’s deputy director at the time. “Her advocacy for the bureau’s creation — the media appearances, the tireless lobbying, all the op-eds — was so effective and so visible that that’s what people tend to remember from that era. But, to me, the more impressive and more surprising thing is just how successful of a chief executive and an entrepreneur she turned out to be.”
Warren gets a lot of the credit for the CFPB’s existence and, by extension, what it’s done for consumers since it opened its doors in 2011. The agency gets an average of 3,000 complaints a day, indicating that the general public still sees a need for its services. As of July 2023, it says it’s gotten $17.5 billion back to Americans in the form of monetary compensation and consumer relief, and has given out $4 billion in fines for violations of consumer financial protection laws, including billions of dollars from repeat offenders Wells Fargo and Bank of America alone.
Despite these successes (or perhaps because of them), the CFPB continues to fight for its very existence. The Supreme Court is set to hear arguments in October on whether it can still be funded through the Federal Reserve. We’ve also seen, through the Trump administration, how much a president can shape the direction of even nominally independent regulatory agencies. His appointees quickly set about reversing a lot of what the CFPB did under Obama (including, for some reason, its very name). They had a much different definition of consumer protection, including protecting the rights of banks and getting rid of the “unwarranted regulatory burdens” on them.
The CFPB is now directed by Rohit Chopra, who has brought it back to its consumer financial protection roots. But that may only last until a Republican takes over the White House, assuming the Supreme Court doesn’t declare it unconstitutional first.
All of this is to say that even the agencies we have don’t have an easy ride. Putting a new one in place will be an infinitely harder one. But with bills like Warren’s on the table, it’s looking more possible than ever.
An FCC or an FAA, but for Big Tech
In many ways, the Digital Consumer Protection Commission that Warren proposes is similar to the Federal Communications Commission and the Federal Aviation Administration, sector-specific agencies created to regulate new and powerful technologies.
“This bill isn’t trying to hard code a solution all at once,” Warren said. “It’s focused on creating a structure, an agency with the flexibility and the expertise to respond to problems as they arise.”
If you’ve been paying attention to Congress’s attempts to pass tech-specific regulation over the last few years, you might recognize a few of the new regulations that Warren’s bill would make these platforms subject to, starting with the fact that they only apply to the very largest platforms with deep pockets and massive user bases. Amazon, Apple, Google, Meta, and Microsoft seem to meet the qualifications, as do TikTok and even Twitter/X. It’s the tech companies of this size, Warren believes, that have become the most problematic and so need the most regulation. New Big Tech companies that emerge — think OpenAI — will also be covered if and when they meet the user and market capitalization minimums.
A big part of this bill is about competition and antitrust. It is, after all, an amendment to the Clayton Act, a foundational antitrust law, and comes to us from someone who has long scrutinized the power that a few massive companies have over many of our industries. The legislation would also outlaw some of the practices that the Big Tech antitrust bills tried to address, like self-preferencing or owning the marketplace on which a company’s own goods compete with third parties.
Online privacy is also covered here. Platforms can’t target ads to users based on data from third parties, must limit the personal data they process, and have to let users access and delete data they’ve collected about them, according to the bill. They must also protect user data from breaches or be subject to monetary penalties (some of which may be given to affected users). There are also provisions requiring that platforms ensure they are not promoting harmful content to users, something that child online safety bills and state laws have been trying to address.
A national security provision includes restrictions on ownership from citizens of “foreign adversaries” and rules about foreign processing of US citizens’ data. It also requires that platforms identify posts from bots and state their country of origin. This seems to be aimed at TikTok and its China-based owners, which some believe is a national security issue but which American laws don’t sufficiently address.
There’s also a section about transparency, which requires covered platforms to have clear terms of service, notify users if they’ve been banned or their content has been otherwise restricted and tell them why, and provide ways for users to appeal those moderation decisions. Users can also appeal to the DCPC if they feel they’ve been unfairly banned. This would address what has been a major issue for Republicans, who often accuse Big Tech of abusing its power to suppress conservative speech.
Finally, the DCPC will have the authority to issue licenses to operate to these companies — and revoke them.
“Banks operate with a license, airlines operate with a license,” Warren said. “The same should be true for the giants in Big Tech.”
“This is a fight worth having”
The fact that Warren is working on this with Lindsey Graham, a Republican who hasn’t always had the nicest things to say about her (nor she of him), shows that Big Tech regulations can be a unifying issue. Any digital platform agency bill is going to need that bipartisan support, though it remains to be seen if there’s enough of it. Warren and Graham introduced the bill over a month ago, but it has yet to attract cosponsors.
“For years I have been trying to find ways to empower consumers against Big Tech,” Graham said in a statement. “A regulatory commission will give consumers a voice against Big Tech and the power to punish them when appropriate.”
Graham’s involvement shouldn’t be a huge surprise, either. He’s been very vocal about wanting to curb certain of Big Tech’s abuses and has sponsored several bipartisan bills to that effect. That includes EARN IT with Sen. Richard Blumenthal (D-CT), and the American Innovation and Choice Online Act, headed up by Sen. Amy Klobuchar (D-MN). Graham also told OpenAI CEO Sam Altman in a hearing last May that he wanted a new federal agency with licensing powers to oversee AI.
That doesn’t mean everyone is on board with this. Sarah Kreps, director of Cornell University’s Tech Policy Institute, isn’t convinced that a new agency is the best approach. There are existing agencies that can handle many of these issues, and she doesn’t think we’ve had the kind of crisis that demonstrates the need for something new. The financial crisis led to the CFPB, for example, and the Department of Homeland Security was created in the wake of 9/11. Kreps also wonders if an agency set up with the goal of checking Big Tech’s power might be unnecessarily antagonistic toward what is one of the biggest drivers of the US economy and technological supremacy.
“Convince me that Apple having the largest market capitalization in the world is an inherent problem for consumers. And if you can convince me that that’s the case, next convince me that the FTC can’t address that problem,” she said.
Kreps also thinks that our existing laws can deal with new and future Big Tech issues — or at least, she hasn’t seen proof that they can’t. The Google antitrust trial has only just begun, and lawsuits that could determine how copyright law applies to generative AI haven’t gone to trial yet.
“I don’t think that it’s inherently bad for the courts to be interpreting existing laws in new contexts,” she said.
Tom Wheeler, who served as the FCC chair under Obama and is author of the upcoming book Techlash, published an extensive study on whether a digital platform agency like the one Bennet and Warren’s bills propose is necessary.
“The digital economy is different from the analog economy, and needs to have regulators with digital DNA and focus,” Wheeler told Vox. The FTC has traditionally been more of an enforcement agency than a rulemaking one, he added, and this is an industry that needs rules set by the government rather than itself.
“I think that there comes a point in time when a critical mass occurs, and I think that is a growing bipartisan sense that, hey, we’ve got to do something,” Wheeler said, especially now that we appear to be on the cusp of massive disruption by generative AI.
As for whether Warren and Graham’s approach is the best way to do that, Wheeler says he’s more focused on the fact that bills like this are getting more people thinking and talking about creating a digital platform agency in the first place.
That sentiment is shared by Harold Feld, a senior vice president for consumer advocacy group Public Knowledge. He has literally written the book on the need for a digital platform agency, and sees this bill as part of what he hopes will be a wave of support for establishing an agency.
“The important thing here is a recognition that, yes, you need an expert agency for something that is this important and that is also very clearly an identifiable sector of the economy at this point,” Feld said. “It’s not something that really can just be tacked on as an additional feature of another agency.”
But Feld doesn’t think we’re getting a law that creates a digital platform agency anytime soon, including Warren’s. The fact that she and others are proposing them, however, makes it more likely that someday we will.
The creation of a new agency to regulate Big Tech will have to overcome what will likely be a lot of opposition from a Republican Party bent on deregulating as many industries as possible. Not all Democrats will support the idea, either. It was Democratic leaders in the House and Senate, after all, who chose not to give the Big Tech antitrust bills a floor vote. The tech industry will fight it too, especially the well-moneyed handful of companies the law applies to. NetChoice, an industry association that counts Amazon, Google, Meta, TikTok, and Twitter among its members, posted a scathing critique of the bill the day it was announced.
“We’re gonna have a fight over this, no doubt about it,” Warren said. “But this is a fight worth having.”
It’s also a fight she’s won before.