Simons Tells Blumenthal, Schakowsky Political Pressure Won’t Sway FTC

Political pressure in executive orders won’t sway the FTC, Chairman Joe Simons wrote June 29 to Sen. Richard Blumenthal, D-Conn., and Rep. Jan Schakowsky, D-Ill. Blumenthal and Schakowsky wrote Simons June 15 with concerns about political influence from President Donald Trump’s EO (see 2005280060) directing the FTC to police unfair and deceptive practices involving online platforms’ content moderation practices, with language targeting Section 230 of the Communications Decency Act. We received the correspondence via a Freedom of Information Act request to the trade commission.

Blumenthal and Schakowsky called the EO a “transparently unconstitutional scheme to coerce private companies for political purposes.” They urged Simons to protect the agency against Trump’s attempt to undermine the FTC’s independence and defend the agency’s “consumer protection and competition mission.” Simons noted the lawmakers’ concern that “any diversion of resources to advance the President’s political agenda would erode the independence of the FTC and threaten the FTC’s ability to bring cases.”

Since the FTC is an independent agency with “substantial quasi-legislative and quasi-judicial responsibilities, it is not subject to executive control in the performance of its statutory functions absent authorization by Congress,” Simons wrote. For at least 40 years, the agency has taken the position that EOs are nonbinding “if they substantively constrain the Commission’s exercise of its discretion. The Commission is obliged to safeguard its law enforcement decisions against political pressure from any source.”

Simons’ letter makes clear that Trump’s “meat-axe, retaliatory” EO is an “illegal threat to our independent agencies,” Blumenthal said in a statement. “Both the FTC and FCC have profound moral and legal obligations to stand up to political pressure from the White House. Well-meaning statements of principles are one thing, what I will be watching for is action.”

Offices for Schakowsky and the White House didn’t comment Friday. Blumenthal and Schakowsky hold the top Democratic seats on the Senate and House Consumer Protection Subcommittees.

Their letter raised “serious alarm” over Trump’s EO in light of Big Tech’s alleged anticompetitive practices. They noted the EO requires the FTC to consider reports of bias “in unrelated legal complaints -- like violations of competitive laws.” That could “create the impression that the agency’s enforcement actions have hidden political motives, which is antithetical to its mission,” they wrote.

The FTC is committed to consumer protection and competition enforcement within “jurisdictional authority and constitutional limitations,” Simons wrote. He cited antitrust efforts, specifically actions taken by the Technology Enforcement Division. Special orders to Google, Amazon, Apple, Facebook and Microsoft (see 2002110023) will assist efforts to “combat anticompetitive conduct and contribute broadly to the FTC’s understanding of technology markets,” Simons said.

Simons cited the agency’s ongoing response to COVID-19 consumer protection issues, as well. The agency has sent 250 warning letters and sued three companies, Simons said. The FTC sued Ponte Investments over scam allegations of targeting small businesses seeking Small Business Administration loans. It filed other lawsuits against Whole Leaf Organics over alleged deceptive COVID-19 health claims and Traffic Jam Events over an alleged scheme involving federal stimulus benefits, Simons wrote. Our earlier FOIA request unearthed documentation of other steps the commission is taking to guard against novel coronavirus scammers (see 2004150070 and 2004160052).