Armstrong Economics Blog/European Union
Re-Posted Jul 23, 2017 by Martin Armstrong
QUESTION: Mr. Armstrong; Is Google really violating European antitrust laws to warrant such a huge fine or is this really a trade war?
ANSWER: It’s a trade war. Granted, the EU hit Google with a record-breaking fine of €2.4 billion ($2.7 billion, £2.1 billion) by European regulators who accused the California-based technology giant of abusing its dominant position and promoting its own shopping service in its search results over those of its competitors.
The European Union Commission claims this is the culmination of a multiyear investigation into Google’s business practices dating back nearly a decade. This in itself proves this is nonsense for the past decade has witnessed a dramatic change in how products are being sold. Amazon has been growing tremendously in sales putting many stores out of business like Sears.
Things are changing. The beginning of this whole antitrust violation took place with the Sherman Antitrust Act passed in the USA back in 1890. The theory was you had all these small railroad companies and they were merging into large regional railroads. The politicians called this a monopoly that put people out of jobs as companies merged and eliminate duplication.
Once again we have dramatic changes to the retail industry. The politicians behind this nonsense of fining Google are just (1) greedy and (2) ignorant. Amazon is already starting to create showrooms where you can go at look at products and then it will be delivered to you in days. This is the way retail is changing. Here is a search I entered for a Sony Laptop. Yes at the top it come up with Google shopping and it says sponsored. However, it shows competitive brands. At the bottom of the page is Amazon. Yes they are competing against Amazon. Does that warrant a huge fine or are politicians just trying to come up with creative means to get more money because they are dead broke?