Nestled among the lofty rhetoric of “hope and change,” Barack Obama made a core promise during the 2008 campaign that he'd put an end to the corporate cronyism that's long pervaded the political system. “The days of sweetheart deals for Halliburton will be over when I'm in the White House,” he proclaimed.
What Obama left out was that the days of sweetheart deals for his cronies had only just begun. His chief corporate advocate, Google, quickly emerged as the Halliburton of his administration. Fortunately, Oklahoma Attorney General Scott Pruitt has taken a firm stand to hold the Internet giant accountable.
Oklahoma is part of a coalition of states that stepped up when the Federal Trade Commission failed to do its job at the national level. The failure to hold Google accountable to federal laws and regulations enforced on its competitors has made this state-driven probe all the more critical. Pruitt's investigation of Google is part of a five-state probe — in conjunction with Texas, California, Ohio and New York — into the company's practices.
An FTC investigation found that Google illegally manipulated search results to favor its own products, scraping content from other websites without any provision allowing those with objections to opt out. It also imposed restrictions that prevent portability of search advertising campaigns across AdWords and other platforms.
While the company was under investigation, however, Google contributed $25,000 to honor FTC Chairman Jon Leibowitz. Furthermore, according to a recent Bloomberg report, Google spent $80,000 in October 2011 to honor Federal Communication Commission Chairman Julius Genachowski and Commissioner Michael Copps, despite an ongoing investigation into Google's Street View product.
The result of Google's questionable lobbying efforts? It walked away from the federal case with a nonbinding “handshake” agreement in which it says it will make minor changes to some of its search functions. When the federal government refuses to step in and stop cronyism, it's up to the states to blow the whistle.
Although it repeatedly promised to comply with investigations, Google later refused to provide requested documents to Texas in a probe that mirrors Oklahoma's. Google argues that it's justified in keeping the requested 14,500 internal documents under wraps, citing attorney-client privilege.
Regardless of how people feel about antitrust laws, the hallmark of corruption is to selectively enforce laws in a way that harms your opponents and accommodates your allies. In this case, an administration that's been aggressive on antitrust enforcement (for instance, spiking the AT&T and T-Mobile merger) took no enforceable action against Google even after finding wrongdoing. It's no surprise that the European Union continues to investigate Google as well.
Some people like Google and hate regulators. Therefore they look favorably on the company's string of free passes. But Google opposes big government only when it restricts Google. The Obama administration has no commitment to regulatory restraint. Google should play by the same rules as everyone else.
Telford is vice president of strategic initiatives and communications at the conservative Franklin Center for Government & Public Integrity in Alexandria, Va.