What's the Hurry? As Official Investigations Loom, Google Dumps Half Its Lobbying Firms

Google still boasts very well politically-connected top-level staff, including new head of policy and government relations Karan Bhatia, former senior trade representative in the George W. Bush administration.

With greater government scrutiny of its business activities impending, Google has fired about a half-dozen of its largest lobbying firms as part of a major overhaul of its global government affairs and policy operations, the Wall Street Journal reports.

Over 2019, the company has “shaken up” its roster of lobbying firms, restructured its Washington policy team and lost two senior officials who helped build its political and commercial influence operation into one of the largest in Washington DC, people familiar with the matter claim. The firms dumped by the search giant account for around 50 percent of its annual US$20 million lobbying budget.

If lobbyists can't help with invading users privacy, you're fired!

Google cuts lobbyists amid government investigation. They fired several of its largest lobbying firms as part of a major overhaul of its global government policy operations.#WednesdayWisdom #wednesdaythoughts pic.twitter.com/DxNZJ1N7LK

— MikeV (@VIMAadvisor) June 12, 2019

The Justice Department is preparing to conduct an antitrust investigation into the company, Congress is also reviewing its practices, and Democratic presidential candidates have called for the company to be broken up.

Among the lobbyists no longer working for the company are controversial long-time Republican strategist Charlie Black and firms boasting close relationships with senior Republicans and Democrats. Another individual leaving the company is Adam Kovacevich, who headed the public-policy division - he was a key player in Google’s efforts to shape laws, regulations and rules in ways favourable to its search and advertising businesses.

Most notably, Kovacevich led the company’s campaign to block a high-profile 2012 Federal Trade Commission investigation into whether the company employed anticompetitive tactics, and helped launch a host of advocacy groups to promote public-policy matters benefiting Google.

Web of Influence

Google employees have for some time collectively been one of the largest sources of funding for the Democratic Party and its candidates, including Hillary Clinton and Barack Obama. In the 2018 congressional elections, Google’s employee-funded PAC donated US$1.9 million to political candidates in both parties.

When Obama took office, Google were richly rewarded for their support - for instance, under his Presidency the Federal Trade Commission declined to pursue an antitrust case against Google in 2013 after a lengthy investigation.

Google also won favourable net-neutrality rules from the Federal Communications Commission, avoided federal privacy regulations in Congress and won a friendly ruling on self-driving vehicles from highway-safety regulators, among many other things.

On top of its direct lobbying efforts, Google has spent also spent untold millions on funding think tanks, political entities, universities and other third-party groups in order to facilitate its commercial interests and objectives.

In July 2017, an in-depth study by the Campaign for Accountability (CfA) identified 330 research papers published 2005 — 2017 that were funded by Google, whether directly or indirectly.

The papers — many of which were authored by respected academics from internationally renowned institutions such as Stanford, Harvard, MIT, Oxford and Cambridge University, and the Berlin School of Economics — covered a wide range of regulatory and legislative issues of critical importance to Google's profits, including antitrust, privacy, net neutrality, search neutrality, patents and copyright, which the firm has often sought to influence in other, more overt ways.

In all, 54 percent were authored by academics directly funded by Google, while the remainder worked for, or were affiliated with, groups or institutions funded by Google. In the majority of cases identified, readers were given no indication of the company's interest in the paper — authors didn't disclose Google funding in 65 percent of cases, even when the company directly paid for the study. Moreover, the number of Google-funded studies published tended to spike when the company came under scrutiny from regulators, or when its competitors faced greater regulation.

A wave of antitrust probe headlines on Facebook and Google just yanked about $137 billion from FANG stocks' market values https://t.co/c6N2eoKdPU pic.twitter.com/BURYhYIS26

— Bloomberg (@business) June 3, 2019

For instance, starting in 2011, Google funded a deluge of academic studies antitrust issues, just when US antitrust regulators began examining the company. Over the next two years, Google-funded academics authored at least 50 papers on antitrust issues, all of which exonerated the search engine giant on charges of monopolization and uncompetitive practices to varying degrees.

One representative study, Google and the Limits of Antitrust: The Case Against the Case Against Google, authored by Geoffrey Manne, International Center for Law & Economics and Joshua Wright, George Mason University, concluded traditional conceptions of antitrust did not apply to the company, and an "aggressive" regulatory approach to Google could be "costly" in innovation terms.

Accordingly, the number of competition-themed papers funded by Google shrivelled rapidly when the Federal Trade Commission closed its investigation in 2013 — however, another spike reared in 2015, when the European Commission levelled formal antitrust charges against the company.