For Google Inc (NASDAQ:GOOG), enthusiastically embracing the Democratic party may now not be such a great thing, thanks to the Federal Trade Commission.
After committing time to President Barack Obama’s re-election campaign, by executive chairman, Eric Schmidt and Google Inc (NASDAQ:GOOG) employees donating heavily to the Democratic National Committee, this could temper a bit, thanks to Barack Obama’s nominee that runs the agency, Jon Leibowitz, a Democrat and former Democratic senator aide.
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In September, Leibowitz announced the agency had launched a formal investigation into Google’s “search and search advertising” practices and said it should conclude by year’s end–right before his term ends, and prior to a possible Mitt Romney win. Some have believed that Leibowitz wants to be known as the regulator who took on Google, reported CNET.
For Google, it could be a good thing if Mitt Romney wins. At least for the FTC case.
Robert Lande, a University of Baltimore antitrust law professor said to CNET, “Republicans wouldn’t think about bringing a case against Google.” He added that a president’s party affiliation “matters a lot” in determining whether to punish companies such as Google Inc (NASDAQ:GOOG), Intel Corporation (NASDAQ:INTC), and Microsoft Corporation (NASDAQ:MSFT).
As for the two presidential candidates, they obviously take opposing views to these types of cases.
Mitt Romney has suggested competitors can go to the marketplace with gloves on, while Obama enthusiastically embraces antitrust.
In 2008, he said President George W. Bush had the “weakest record of antitrust enforcement of any administration in the last half century”, and his Justice Department antitrust chief, Christine Varney blamed George Bush for “too many hurdles” hampering the enforcement of antitrust; she subsequently changed policies by her Republican predecessor, upon taking over her role.
As cited by The New York Times, it wrote in 2009, “Obama Takes Tougher Antitrust Line.”
For Google’s executives and its employees, it’s been a long-standing love affair with the Democratic party. But it hasn’t really served them well.
According to CNET, Jim Harper, director of information policy studies at the Cato Institute, has said political enthusiasm doesn’t translate into tangibles for Google. He noted, “The love shown to Democrats by Google has not resulted in any material policy benefits.”
Micros0ft is likely to agree.
After showing their love to the Democratic party in the 1990s, in 1998, a Democratic administration hit the company with a large antitrust lawsuit; it requested the company break up into different pieces. The company reacted by giving the GOP more money in 1998, 2000, and 2002.
Conservative groups jumped on, and Americans for Tax Reform distributed a a press release called “Taxpayers Protest the Antitrust Vendetta Against Microsoft.” The Heritage Foundation said it was the “financial equivalent” of “state terrorism” reported CNET.
The case settled in 2004 under the Bush administration, and it was approved by a federal judge. Funny, after awhile Microsoft employees slowly returned to their previous political allegiance.
Will the same thing happen for Google Inc (NASDAQ:GOOG) should a Republican take over in November?
As for Google’s case, the FTC has not commented. A Google spokesman said to CNET, “We continue to work cooperatively with the Federal Trade Commission, and are happy to answer any questions they may have.”