Title: Challenging DEI, Slashing Public Comments: The New FTC Chair's Stance on Surveillance Pricing
While the tenure of FTC Chair Lina Khan was marked by tackling monopolies and combating unfair prices, her successor, Andrew Ferguson, seems to have identified a different root cause for economic woes: Diversity, Equity, and Inclusion (DEI). Commissioner Alvaro Bedoya isn't convinced that this approach will be effective, and in a passionate dissent, he pointed out several areas where the FTC had sought public input but has since closed off these avenues.
To illustrate, Bedoya cited five requests for information from the FTC. These included exploring ways to safeguard workers from unlawful business practices like noncompetes and no-poach clauses, combat predatory pricing, and support small businesses. Interestingly, Ferguson decided to shut down discussions on a request related to surveillance pricing practices, such as investigating how companies collect and utilize user data to set varying prices based on individual behavior.
This practice, commonly referred to as dynamic pricing, has become increasingly prevalent, especially online. Companies gather substantive user data while consumers browse, potentially even adjusting prices based on mouse movements on a webpage. Recent research by the FTC revealed that this method is more widespread than previously thought, with businesses setting "targeted, tailored prices for goods and services" based on various factors, including location, demographics, and browsing habits.
Commissioner Bedoya argued that Ferguson's focus on DEI, often seen as a "stunt" for gaining online popularity, may not be the most effective strategy to address economic difficulties. He highlighted that rising living costs and increased debt and poverty among Americans are more pressing issues, and it's unclear how this focus on DEI would address these concerns. While it's uncertain whether more engagement from Ferguson would lead to revenue sharing with the public, the path towards alleviating economic hardships seems less likely to involve this approach.
Enrichment Data:
The shift in focus towards DEI under Chair Ferguson could have various implications for the FTC's work:
- Protection of Workers from Illegal Business Practices:
- Potential Resources Diversion: Ferguson's emphasis on DEI could potentially divert resources from the FTC's mission to protect workers from exploitative business practices, potentially weakening its overall ability to address these issues effectively.
- Combating Predatory Pricing:
- Regulatory Environment Impact: Changes in the regulatory environment could affect how the FTC tackles predatory pricing, potentially leading to a temporary reduction in aggressive enforcement or less attention being paid to these matters.
- Supporting Small Businesses:
- Potential Attention Diversion: The new focus on DEI might result in less attention and support for small businesses, potentially hindering their ability to navigate complex regulatory environments.
Commissioner Alvaro Bedoya's dissent stems from concerns about the impact of this focus on DEI on the FTC's core mission and the erosion of protections for consumers and workers. If DEI initiatives are dismantled, consumer rights could be jeopardized. Additionally, reduced enforcement actions against predatory practices could leave both workers and consumers unprotected. Lastly, a significant departure from the FTC's core mission of promoting competition and protecting consumers could lead to a less effective agency in addressing pressing issues like predatory pricing and worker exploitation.
The shift towards DEI under Chair Ferguson might lead to potential resource diversions from tackling future tech-related monopolies and ensuring fair technology practices, as the FTC's focus expands. The future of tech regulation could hinge on how effectively DEI initiatives align with combating unfair prices and supporting small tech businesses.
Commissioner Bedoya's concerns about DEI's impact on the FTC's core mission extend to the future, where advocating for diversity might impact the agency's ability to tackle emerging tech issues and safeguard consumer rights in the rapidly evolving tech landscape.
