Washington – The U.S. could suffer a staggering $123 billion GDP loss and the elimination of 346,000 jobs within just the first year if states enact draconian antitrust laws like the New York Twenty-First Century Antitrust Act, creating ripple effects that will reverberate throughout the global market, according to projections in a new study. The research also finds that the negative effects of the law will grow over time, costing the U.S. a 4.4% GDP loss of $1.7 trillion and 3.5 million fewer jobs over the next decade. The Computer & Communications Industry Association’s Research Center today released the study, “Assessment of Economic Costs of Imposing Abuse of Dominance Standards at the State Level,” highlighting the negative impacts of the New York proposal.
As state-level antitrust policies expand across the United States, the Twenty-First Century Antitrust Act stands out for its potential profound negative effects on the state’s economy. According to the study, with the inclusion of “abuse of dominance” language, it will create undue regulatory reach and uncertainty for potential violations. This refers to the actions of a company that purportedly holds a dominant market position and negatively impacts other businesses. It would establish a state-level antitrust regime stricter than federal regulations for all companies operating within New York. This heightened likelihood of intervention could inhibit efficient business behaviors that benefit consumers, especially in the technology sector. The proposed law targets successful corporations that are broadly popular among consumers, particularly tech companies, characterizing their popularity as dominant market positions to impose costly regulations on workers, consumers, and businesses in New York.
Excessive regulatory burdens on tech companies could stifle growth and innovation, crucial elements of today’s economy driven by social media and technology. High compliance costs and legal uncertainties may discourage investment, leading to a substantial reduction in New York’s GDP and job creation, the CCIA study found. Additionally, the Twenty-First Century Antitrust Act lowers the threshold for individuals and companies to sue for damages, potentially flooding New York businesses with costly and time-consuming litigation that could further deter business operations and investments in the state.
The following can be attributed to CCIA Chief Economist and Research Center Director Trevor Wagener:
“The economic repercussions of enacting state-level ‘abuse of dominance’ laws would reverberate both nationally and internationally, given the substantial presence of leading companies, particularly tech firms, operating in U.S. states. Over a decade, such legislation could precipitate a staggering $1.7 trillion GDP loss and the elimination of up to 3.5 million jobs across the country. Such extensive economic fallout would bear severe consequences for the broader American and global economy. This report and these statistics underscore the profound implications of these economic effects on the country and residents of individual states.”