Is It Time to Downsize American Tech Companies?

Throughout our history Americans have been wary of large corporate entities, from early opposition to British crown monopolies to the political animus targeting the robber barons in the late 19th century. Today, this concern has re-emerged, as the world’s tech giants come under increasing scrutiny at home and abroad. Google, Facebook, Apple, and others already have been slapped with substantial fines in the EU and elsewhere, and there is a steady drumbeat in Congress — on both sides of the aisle — calling for greater oversight or even breaking up large American tech companies. Before rushing headlong down the rabbit hole of regulation, it is worth noting that today’s consumers are far better off, thanks to new technologies introduced by the very firms under fire. Innovation can be disruptive and pose a real threat to industry incumbents and old business models, but as long as output is expanding, prices are falling, and quality is improving, regulatory zeal can do more harm than good. Perhaps the most concise and popular explanation of this fetish for all things small is E.F. Schumacher’s classic, Small Is Beautiful. A creature of its time, this 1973 bestseller extolled the virtues of small-scale technology as opposed to globalization and multinational corporations. Schumacher was concerned about wielding the power of science and technology to unleash outsized multinationals with an insatiable thirst for profits, creating an ecological dystopia and alienated workforce. As a remedy, Schumacher preached economics on a human scale, abandoning the mantra of bigger is better for a more rewarding work experience through small, local applications of technology. Yet, history did not play out according to Schumacher’s vision. Multinationals made the world a better place, not worse. The world economy is surging, global poverty rates are down, and the health of the planet is better today than it was in the 1970s, thanks in part to innovations and technological advances Schumac...