Senator Amy Klobuchar (D-MN) joins Yahoo Finance Live to discuss her new book ‘Antitrust’ and how she plans to tackle monopolies.

Video Transcript

AKIKO FUJITA: Well, Chair of the Senate Judiciary Committee on Antitrust, Senator Amy Klobuchar, has been outspoken-- an outspoken critic about the power of big tech companies like Google and Facebook. But in her new book "Antitrust," she argues those powers aren't necessarily limited to the tech sector.

Let's bring in the senator herself, Senator Klobuchar joining us from DC today. Senator, it's great to talk to you today. I'm to get into your book in just a bit. But I'd love to get your thoughts on this decision that came down from the Facebook oversight board today essentially upholding the ban on President Trump, but also saying Facebook didn't necessarily follow their own rules. Do you agree with the decision?

AMY KLOBUCHAR: I haven't read the decision, but I have been a proponent of keeping him off of social media platforms. Why? Because he is the ultimate conveyor of misinformation. He's the disinformer-in-chief. He is the one that basically still will not admit that he lost the election and keeps putting out theories that literally undermine our democracy itself, inciting-- in my mind, inciting the insurrection. So I'm sure that was all in their minds. It's not like he has changed his tune in terms of undermining our democracy.

AKIKO FUJITA: As of now, that decision is indefinite. It's just a suspension. Do you think it should be a permanent ban?

AMY KLOBUCHAR: I am in favor of banning him. But for me, the bigger issue actually is what they are doing in general about misinformation, and why I wrote this book not just about tech. But when you have monopolies, they have less of an incentive to develop the bells and whistles to protect people's privacy and to do something about misinformation.

Due to public pressure, they are doing this now when it comes to vaccine misinformation and the like. But when you think about, maybe Instagram or WhatsApp could have developed some better bells and whistles for this, but they weren't given the choice. Because in Zuckerberg words, he'd rather buy than compete. As he said in another email that was discovered in the House hearings, while they were nascent small competitors, in his words, they could be disruptive to us.

Tech and competition is all about disruption. And in my book "Antitrust," I point out through history our capitalist system, which I strongly support-- and been in the private sector myself-- has rejuvenated itself with checks and balances from antitrust. That was the breakup of Standard Oil. That was the breakup of AT&T. That was why our colonists, in part, threw tea in Boston Harbor, because they didn't want to have to buy all their tea from the East India Company from Britain. That was a monopoly.

So I just-- if you look at this from a pure capitalist standpoint, you come out in favor of allowing competition and allowing our economy to thrive by not having big monopoly gateways in so many different areas.

ZACK GUZMAN: Yeah, Senator, Zack here. Appreciate you coming on. I mean, when we talk about the book and, you know, antitrust issues here and how important it is-- and those examples you cite in the book-- you know, how clear it was for consumers to know that something was bad when they had to pay more for something. But when it comes to tech, it seems like a piece of why you wrote this book was kind of explaining what's going on behind the scenes and why it's so difficult. I mean, we've seen this time and time again in Congress, really trying to push into why it's bad for consumers. But it seems rather difficult. Has that been a big issue for you in kind of trying to tell the public where the problems are? And what are those specific examples you've been pointing to?

AMY KLOBUCHAR: Yes. But when I point out to them-- look at cable rates over the years and what's happened there. Look at pharma. If you need an EpiPen, like my daughter does, or you need insulin-- or the story I tell in the book of a baby heart drug, where one company bought both drugs. They cornered the market, and the price went from 80-some bucks to 1,600 just like that, for no other reason except that they cornered the market. This happens throughout our economy.

And with tech, you're right. It's a little harder to make the argument. But I think people feel it when they find out their data been mined or they realize they don't really have a choice. Or what if you lived in Australia and you were told by Google and Facebook that they're just going to take their marbles and go. And Google basically controls 90% of their search market. Due to world pressure, they backed down.

But all-- what if you work at a newspaper and you're not getting paid for your content? Or you are a small restaurant that pretty soon sees that the home delivery services that are so key to your success, we're going to combine and there's not going to be competition. Again, there was pushback, and one of those deals went down. But these are the kinds of things that people are starting to understand. It's why I wrote the book.

ZACK GUZMAN: Well, you've been busy not just writing the book, but you also introduced legislation here writing a bill. I want to talk about that, the Competition and Antitrust Law Enforcement Reform Act, and kind of trying to address some of these issues that you say agencies oversight here don't have enough power. And I'm curious to kind of apply what that bill seeks to do to maybe one real-life example we're seeing play out right now in the legal battle between Fortnite gamemaker and Apple over those charges, the fees charged in the App Store and the way that they continue to charge companies through the App Store. I mean, how much of this bill is attached to maybe strengthening the way that regulators-- after the fact, as you said-- can go back and do more to police this?

AMY KLOBUCHAR: That's a great example, and I'm sure everyone that's interested in these issues is watching that case carefully. So what the bill does, it says not only do you have some-- some standards going forward when mergers come before the agencies-- FTC or Department of Justice-- that you make it easier for those agencies to look at those mergers and prove up that there is a problem with competition. But it also says, as we did with the AT&T breakup, why don't you make it easier to look backwards and look for that exclusionary conduct?

Senator Mike Lee and I had an incredible hearing on the App Store issue with witnesses from Apple and Google. And there was Spotify, Tile, and Match.com, and their stories were horrendous. They're charged up to 30%. Everything people buy from their own apps on the App Store, 30% goes to Apple or Google. They are not allowed to tell customers that they can get cheaper deals, including finding a date, on their own website. And then in some cases, we believe there's self-preferencing in going on, where the company's own products are boosted up over the competitors.

So to me, that cries out for looking backwards at the market. Yes, you can do it by lawsuits, like Epic Games is doing. But probably the best way to do it is a major investigation. And that's why Senator Grassley and I have called for a restructuring of the fees for mergers so the big guys are putting more money into those department so that money can be used to help consumers by looking at the deals.

You can't take on the biggest companies the world has ever known with bandaids and duct tape. These agencies are a shadow of their former selves back even during the time of Ronald Reagan.

AKIKO FUJITA: Senator, when you talk about what specifically you've proposed in this bill-- resetting the standard for enforcement, also shifting the burden of proof on the dominant player within the mergers-- and you look back over the last 5, 10 years or so of mergers that have happened, how many of those do you think would have actually gone through if the standards you're proposing would have been in place?

AMY KLOBUCHAR: I think you would have looked very differently at T-Mobile-Sprint honestly, because you're down to only-- and I opposed that merger. You're down to so few companies in an area that where we did have a lot of competition that benefited consumers. AT&T Time Warner-- I don't know. That might have been looked at differently. As you know, the Justice Department challenged that.

I can't fact by fact go through each case for you. But I think even making a minor change to the standards, like saying if it's a real big merger-- I picked the number $5 billion and up-- that then the burden is on the companies to show that this merger doesn't hurt competition. Even a change like that that's favored by some Republicans I know, that will not just change the way those court cases go. It changes decisions people make. And they start looking at it and saying, I don't know if we're really going to prove this up.

President Obama's former head of antitrust, Bill Baer, said that they were looking at deals that never should have even made it out of the boardroom. That's how weak our enforcement mechanisms have become, in part because of rulings out of the courts. And yeah, we could sit around and hope that courts are going to change their minds and reject the Bork theories that led them to this change in interpretation of the antitrust laws. I just don't think that's going to happen for 50 or 100 years. And by then we're going to have squelched so much competition and so many small startups.

They can start up, but are they really going to be able to compete in the end? I just look at history as a guide. I look at the bipartisan support going forward. We have to do some simple, reasonable things to ramp up competition again.

AKIKO FUJITA: And when you apply that standard that you've put forward in the tech sector, how differently do you think it would look? We're talking about four or five major players today. And yet, there are a lot of startups that are coming up through the pipeline that have been able to raise significant amounts of money. Some would argue, look, there is still plenty of competition out there. What do you say to that?

AMY KLOBUCHAR: OK, well, a great example in the tech area would be Facebook's purchase of Instagram and WhatsApp. Many of-- that went through during the Obama time period. And a lot of people who work there now are saying, yeah, we should have looked at that more carefully.

I think that you can say we have startups. That is correct. But when you really look at what's happening to the economy as a whole, these mega gateway companies have too much power over not just tech startups, but too much power over the economy in general. And that doesn't mean that we destroy them. I'm glad they're successful. I'm honestly glad they employ a bunch of people. I'm glad-- you know, I wear Fitbit. I've got an iPhone. That's all good.

But at some point, you start saying, OK, just like we did with AT&T, we need to have them divest some of these assets so we can actually have real competition. Because as I said, the privacy stuff-- that's real. Data mining-- that is real. The misinformation out there on vaccines and on the election and everything else-- that was real. I just believe we can do better. We don't have to turn into China with one big company controlling our lives.

ZACK GUZMAN: And Senator, lastly, I just want to shift over to some of the other issues we're watching play out here now too outside antitrust. Social justice obviously has been one that a lot of Americans have been watching closely now. Police reform issues-- obviously a big issue there in Minnesota and around the country after the killing of George Floyd. But we haven't necessarily seen a lot of direct change at the federal level to point to. And I'd, you know, attach both of these things to kind of marijuana reform too.

As we know, kind of policing around that has been very different across racial lines. In your state right now there's a battle going on to legalize marijuana. Same thing in the Senate, but we haven't necessarily seen much progress there from Leader Schumer yet. Is that one thing that you might look at as maybe a very real and direct change that could be made at a federal level? And why haven't we seen anything necessarily happen yet in the Senate?

AMY KLOBUCHAR: Well, I support legalization. I think a lot of it is that it is hard to move these bills. Senator Schumer is very supportive. He's led one of the bills on legalization.

But remember, we are still at 50-50 in the Senate. People forget that. And yes, Vice President Harris can come in and break some ties. But under the existing rules, you have to get to 60 unless it involves some kind of taxation. It is possible you could do something with a legalization bill on another bill that doesn't require 60 votes.

The second thing you asked about was the George Floyd Justice in Policing Act. And obviously, that's hit my state hard. We were-- there was a moment of redemption with that jury verdict. So proud of the citizens that came forward after shouldering that burden for so long when they talked about how they would wake up in the middle of the night thinking that they should have done more. No, no. It's not them that should have done more. It's us.

And we should not confuse accountability with that verdict with true justice. And true justice means that a kid like Daunte Wright doesn't get stopped again for having an expired tab and end up shot. True justice means that he gets to home-- gets to go home and have dinner with his mom. True justice means that they don't use chokeholds anymore.

And that's why Cory Booker is leading the effort right now in the George Floyd bill. I'm obviously supportive, one of the co-sponsors. And he is making some great progress right now in negotiating it. And as you know, President Biden in his State of the Union made it very clear he wants to get that done before the anniversary of George Floyd's death. So I would just say, stay tuned on that. There's some real progress being made.

AKIKO FUJITA: Well, we hope to have you back on the show when there is progress made there. Minnesota Senator Amy Klobuchar, it's great to talk to you today. Really appreciate your time.