The FTC’s Amazon-Temu Blunder: A Question of Strategy
The Federal Trade Commission’s (FTC) decision to seek information from Temu, a Chinese e-commerce platform, as part of its antitrust case against Amazon has sparked controversy. This decision, which has raised serious questions about the agency’s use of prosecutorial discretion, highlights a potential disconnect between American strategic interests and antitrust policy.
The FTC has long framed its antitrust case as a defense of small businesses and ordinary consumers. However, the collaboration with Temu, Amazon’s largest global competitor, paints a different picture. Temu, with documented connections to the Chinese Communist Party (CCP) and facing scrutiny over labor practices and data privacy, represents a strategic challenge. China’s pattern of using its domestic market to create “national champions” that can outcompete US firms is well-established, making the FTC’s partnership with such an entity a cause for concern.
This isn’t the first time the FTC has collaborated with foreign entities to target American technology companies. Earlier, the FTC coordinated with European regulators to block Amazon’s acquisition of iRobot, leading to negative consequences for iRobot. Such collaborations, especially when involving companies linked to the CCP, raise questions about strategic alignment.
The FTC’s actions, viewed alongside its antitrust claims against Amazon, suggest a deep-seated animosity toward the company. The former chair, Lina Khan, has long advocated for breaking up Amazon, and her refusal to recuse herself from the case, despite ethical concerns, has raised eyebrows. The resignation of an FTC commissioner, who voiced ethical objections, further complicated the situation.
Furthermore, the FTC’s collaboration with Temu seems at odds with the broader U.S. approach to China. The Biden administration, like the Trump administration before it, has identified China as America’s primary strategic competitor, and Congress has been working to enhance American competitiveness. The fact that the U.S. has banned TikTok due to national security concerns, while the FTC collaborates with another Chinese platform, underscores this inconsistency.
The partnership with Chinese tech firms is especially concerning given the U.S.-China rivalry in areas like artificial intelligence (AI). Leadership in AI is crucial for technological dominance, economic power, and military advantage. China’s ability to innovate in this field, as demonstrated by companies like DeepSeek, further emphasizes the stakes. Collaborating with Temu to attack Amazon, which has invested heavily in AI, seems counterproductive.
The new Trump administration should consider realigning antitrust policy with strategic objectives. A realignment in antitrust policy necessitates greater attention to American strategic interests. The enforcement actions should prioritize American innovation. This means maintaining constructive collaborations instead of using antitrust like an ideological weapon that benefits foreign rivals. Such a realignment is critical to maintaining America’s technological edge, particularly in critical fields like AI.
