Tag: grow

Google’s merger with ITA helped it grow into the giant that the Justice Department is scrutinizing

Google critics and rivals have long warned the search engine is threatening countless industries from shopping to travel by consistently pointing people to its own products and services on the biggest search platform on the Web. And those competing against Google to win over consumers say that the search engine forces them to pay their biggest rival in advertising dollars just to show up.

Google’s dominance in search has drawn more regulatory scrutiny and criticism from rivals and lawmakers in recent months, something that is expected to culminate in the Department of Justice filing an antitrust suit against the company in the coming weeks. Lawmakers are also preparing new legislation to rein in tech’s power, following the publication last week of a congressional investigation that found Google engaged in anticompetitive tactics.

The case by the Justice Department would be its biggest swing yet to rein in the power of tech giants in decades, and the stakes couldn’t be higher. But some who warned the government a decade ago say it may be too late.

Google “is a monopoly, without question,” Barry Diller, chairman of Expedia and IAC, said in an interview. Google has been great for consumers, Diller said, but it increasingly restricts competitors by making it more expensive to compete in online advertising. Expedia and IAC sites are pushed down the page in favor of Google’s own services, he said.

“Google is essentially competing with our services while taking our money,” he said. “I don’t want the person I’m spending billions of dollars with to compete directly against me.”

Ten years ago, the government had a chance to block the purchase of a travel software company that now powers Google’s flight searches. Even though the government found it might cut into consumer choice, regulators approved it with just a few conditions.

The travel company, ITA Software, made a powerful engine used by Hotwire, Orbitz and other online companies to search flight options and quickly show fares and schedules. Google, which had a sparse travel presence at the time, scooped it up for $700 million.

Some of Google’s acquisitions over the past decade-and-a-half have triggered federal government reviews, but the company has emerged largely unscathed. Its $2.1 billion purchase of Fitbit, which would give it valuable health data, is under review now.

And over time, its search results page has evolved to include more readily accessible answers — and more of Google’s own products.

“It’s such a gradual process,” said Pete Meyers, an expert on Google Search algorithms who works as a marketing scientist at search engine optimization company Moz. “It’s often subtle in the moment. Six months later, when all of these small changes accumulate, Search can look very different.”

The congressional report specifically called out Google’s tendency to fill out search results with its own content or ads, effectively limiting traffic to the outside while simultaneously allowing it to charge more. The report also said Google gives its own products a boost even when inferior to competitors. Google

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‘Danger sign’: State, local government job losses grow as Congress stalls on relief

The new data undercut a Republican argument that state and local governments have gotten enough help from Washington, with some citing an uptick in revenue for many states this summer that outpaced initial projections. But the job losses suggest that economic relief that Congress approved in the CARES Act in late March gave a temporary boost to local economies that’s now drying up.

Not all Republicans have rejected more state aid outright. In an interview, Sen. Bob Menendez (D-N.J.) cited three Republican cosponsors — Sen. Bill Cassidy of Louisiana, Cindy Hyde-Smith of Mississippi and Susan Collins of Maine — for his bill to provide $500 billion in flexible grants to help state and local governments.

“One of the lessons we should take from the Great Recession was that massive layoffs and tax increases at the state and local level acted as an anchor and weighed down our economic recovery for years to come,” Menendez said. “We shouldn’t repeat that.”

He pointed to a Moody’s Analytics report this month that predicted the fiscal shock for state and local governments could run as high as $450 billion, or 2.2 percent of the economy. However, that figure assumes an additional stimulus, projected at approximately $1.5 trillion, from the federal government arriving sometime in the fall.

Rep. Tom Cole (R-Okla.), a member of the House Republican leadership and a senior appropriator, told POLITICO that if lawmakers fail to reach agreement soon, the economy could “lose the momentum that we created over the summer.”

“There’s a lot of things that were actually generating revenue for states that are ending,” Cole said, referring to unemployment benefits, stimulus checks and coronavirus support funds.

Even though many of his fellow Republicans think no more aid is needed, the “political reality is if you want a package, there’s going to have to be state and local and tribal aid in it, period,” Cole said.

Meanwhile, local budget officials have kept up a steady call for more aid. They also warn that federal funds already provided can’t be used the same way by all states.

Colorado Treasurer Dave Young said that even though the state managed to fill shortfalls earlier this year using reserves, the drawdown led to automatic spending cuts because a certain level of reserve funds is required by statute.

Young said the state also has difficulty using the Municipal Liquidity Facility, which the Federal Reserve set up in April as a backstop emergency lending source for states in financial distress. With so few states using the facility, Sen. Pat Toomey (R-Pa.) has suggested that officials wind it down.

But Young said the facility, which lends short-term debt at above-market rates to be paid off over a maximum of three years, isn’t a viable option for Colorado, because state law requires that any borrowing must be paid off in the same fiscal year it is made.

“When they say, ‘Well, you’re not utilizing it!’ Well, there’s a number of reasons we’re not utilizing it. None of them have

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