Last weekend news broke that the Federal Trade Commission was about to settle its two-year antitrust investigation of Google with what charitably could be termed a slight tap on the wrist. But by Tuesday night the reported holiday gift to the Internet giant was unraveling and the FTC signaled it would keep the investigation going into January.

So what’s behind the Commission’s new found spine?  Is it real? Will it last?

First, let’s review what reportedly was on the table.  The FTC wasn’t going to do anything meaningful about the way Google favors its own services in search.  It was  going to accept a non-binding note from the Internet giant essentially promising to play nice with others.  Google would stop scrapping content from other sites and would make it easier to move ad campaigns from Google to other sites.  There would be no binding consent agreement on the key issues.  Supposedly Google would sign a consent agreement on the unrelated question of how it unfairly uses  its “Standards Essential Patents” to thwart competitors.

But on the key anticompetitive issues that harm competitors and consumers Google once again would be saying, “Trust us, we’ll be nice.”  Given its record of broken promises and violated consent agreements, why would anyone believe Google?

So when word of the expected settlement leaked, there was substantial pushback. Craig Timberg of The Washington Post explained it like this:

“Recent news reports detailing the terms of the tentative agreement unleashed a torrent of opposition from companies that had complained, state attorneys general who felt cut out of negotiations, interested lawmakers and consumer advocates. Many have long said that Google was manipulating search results to hobble competitors and gain advantage for its own offerings in shopping, travel services and other lucrative businesses – and in the process, limiting consumer choice.”

Consumer Watchdog has been pushing the FTC for meaningful action since the antitrust probe began. Last month we wrote a letter to the Commissioners urging them to file an antitrust suit and seek the breakup of the company and a spinoff of the Motorola Mobility subsidiary.  With the reports that the FTC appeared to be caving, on Tuesday we wrote to Attorney General Eric Holder asking the Department of Justice to take over the ongoing federal antitrust probe of Google after the company’s chairman in a news interview equated it with antitrust poster child Microsoft in the 1990s.

The same day The Emperor of All Identities, an op-ed written by former FTC Commissioner Pamela Harbour Jones, appeared in The New York Times. She wrote:

But we need to look at Google’s market role – and behavior – through a different prism. Google is not just a “search engine company,” or an “online services company,” or a publisher, or an advertising platform. At its core, it’s a data collection company.

Its “market” is data by, from and about consumers – you, that is. And in that realm, its role is so dominant as to be overwhelming, and scary. Data is the engine of online markets and has become, indeed, a new asset class…

Now, the FTC. has another chance to protect consumers, promote innovation and ensure fair competition online. In making its decision, it must understand that while Google may be the runaway leader in Web search and online advertising, its most troubling dominance is in the marketplace of private consumer data. If real competition in this area can be restored, I am confident that market forces will provide the incentives necessary for companies to offer attractive services and relevant, engaging ads without violating consumer privacy.

Perhaps the FTC commissioners felt trapped in a pincer between state antitrust investigations  and the probe underway by the European Commission.  Texas, California, Ohio and New York have active investigations of the Internet giant.  In fact Texas has sued Google to get documents it needs for the investigation.  Google is stiffing  the Texas AG. As Ed Wyatt and Clair Cain Miller reported in The New York Times, “State attorneys general, some of whom are undertaking their own Google investigation, were briefed on the potential agreement, and some were unhappy that they were not included in the talks and that the proposed punishment seemed light.”

Meanwhile, Politico’s Steve Friess and Elizabeth Wasserman noted that “European regulators appear headed toward a dramatically different conclusion to their antitrust probe of Google than their American counterparts – a binding agreement that could cost the search company dearly if violated. That’s one of several reasons why the expected Federal Trade Commission settlement that sources said was a done deal unraveled Tuesday.”

“At the FTC, people close to the agency said, commissioners grew irked that they were being portrayed as spineless, wrote Wyatt and Miller in The New York Times. “In a parallel investigation, European regulators were said to be wringing a more stringent agreement from Google.”

Well, maybe the commissioners are irked at being called spineless, but guess what?  They were.  I hope they are beginning to see the need — at a very minimum — for a binding consent decree that halts Google’s abuses. However, the best course would be to follow the FTC staff’s recommendation and file an antitrust suit. The fully developed public record that would result from a trial would ensure that effective remedies could be put in place.  A negotiated settlement will inevitably invite cynicism about the results, and keep any documents obtained in the course of the investigation out of the public eye.

Meanwhile, the states attorneys general must keep their investigations open and aggressive in case the FTC falters again.  We need to keep the pressure on; it would be a sad situation if we have to rely on  the European Commission to solve our antitrust problems for us.

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Posted by John M. Simpson. John is a leading voice on technological privacy and stem cell research issues. His investigations this year of Google’s online privacy practices and book publishing agreements triggered intense media scrutiny and federal interest in the online giant’s business practices. His critique of patents on human embryonic stem cells has been key to expanding the ability of American scientists to conduct stem cell research. He has ensured that California’s taxpayer-funded stem cell research will lead to broadly accessible and affordable medicine and not just government-subsidized profiteering. Prior to joining Consumer Watchdog in 2005, he was executive editor of Tribune Media Services International, a syndication company. Before that, he was deputy editor of USA Today and editor of its international edition. Simpson taught journalism a Dublin City University in Ireland, and consulted for The Irish Times and The Gleaner in Jamaica. He served as president of the World Editors Forum. He holds a B.A. in philosophy from Harpur College of SUNY Binghamton and was a Gannett Fellow at the Center for Asian and Pacific Studies at the University of Hawaii. He has an M.A. in Communication Management from USC’s Annenberg School for Communication.

Five days left to go, and the news continues out of CA-32–mostly recaps and summaries.  And most of these articles are some of the prime examples of just why journalism is suffering–perhaps I should call it “the banality of balance.”  In the attempt to be as even-handed as possible, the truth is often a casualty.  But there are a couple of good, more detailed pieces about the election, which I’d like to highlight below.

For the sake of brevity, go beneath the flip.  I promise it’s worth the click.  There’s a lot of interesting material today.

Before I get started with the main event, I want to point out a couple of things.  First, the Huffington Post is joining a bunch of other publications, online and offline, in giving Emanuel Pleitez very positive coverage.  Regardless of the outcome of this race, there’s a bright future for Pleitez ahead, it would seem.  He’s making a lot of friends and few enemies during this campaign.

And speaking of Emanuel Pleitez: Gil Cedillo was doing an interview with progressive Latino radio host Mario Solis Marich today.  And according to a tweet from Mario, Cedillo defended the controversial mailer against Pleitez by saying that he and Latina actress Rosario Dawson were “glamorizing gang activity” by being photographed flashing the symbol for the nonprofit, nonpartisan voter registration advocacy group Voto Latino.  Memo to Gil Cedillo: if you want to consider it a mistake to flash a symbol for something because of the fact that flashing signs is often associated with gang membership, that’s one thing.  But equating that with “glamorizing gang activity”–which usually amounts to murder, robbery, assault and extortion–is something else entirely.  When you’re in a hole, stop digging.

Now then.  Both Roll Call and Politico take up the issue of CD-32 in their online versions today.  Both of these treatments are far superior to the L.A. Times article I scorned yesterday. If you read them, you’re likely to get the same basic information, which could be summarized as follows:

• The district is mostly Latino, but Asians tend to be more active voters.

• Demographics would seem to favor Cedillo, but Chu is a good crossover candidate with good labor support and endorsements from many Latino leaders and electeds.

• Emanuel Pleitez has taken many by surprise by building a strong campaign, but he’ll be a spoiler at best.  Betty Chu might influence things by confusing people.

• Both the Cedillo and Chu campaign has gone negative, and Cedillo’s has gone negative against Pleitez, which indicates that it’s worried about Pleitez’ Latino support.

• Turnout will suck.

• Who will win?  Take a wild guess, and you’ll be as good a prognosticator as anyone.

That’s a fair summary of the race.  What I don’t like about these articles, though, is that neither of them take a stab at evaluating the truth and accuracy of many of the accusations that have been flying back and forth, despite the treatment of those pieces in major media outlets.  You can find a good recap of those issues by reading the Calitics coverage of the CA-32 race.  Nevertheless, both these articles have a couple of interesting tidbits, which I’d like to highlight.

First, Judy Chu’s consultant Parke Skelton was misreported by both articles concerning the percentage of absentee voters of Asian descent–the Roll Call article quotes Skelton as saying that Asians make up 29% of the 12,000 voters that have returned absentee ballots, while the Politico piece quotes Skelton as calculating it at 37% of 10,000.  Thankfully, your intrepid CA-32 correspondent has obtained clarification from Mr. Skelton about this:

The numbers are, about 29% of those already voted are API [Asian-Pacific Islander].  About 37% of the field generated AVs [absentee voters] are API.

The number got mangled by one of the reporters.

The already voteds are heavily PAV [permanent absentee voter], the field generates come in later.

So what does that mean in practice?  It seems to be encouraging for the Chu campaign so far.  As a whole in the district, 29% of those who have already cast ballots are API, and those are heavily permanent absentee voters who are usually active voters.  A field-generated absentee voter is a direct product of campaign activity–getting a voter who is a supporter to register for an absentee ballot and turn it in to make sure that the campaign doesn’t have to worry about GOTV on GOTV weekend and election day.  If, in the whole district, 37% of field-generated votes so far are from the API community–twice the percentage of Asians registered in the district as a whole–it seems to indicate that the Chu campaign is mobilizing its ethnic base effectively with its absentee voter campaign.  To be able to counter this, the Cedillo campaign will need a very effective election-day mobilization strategy.  To their credit, that’s exactly what campaign manager Derek Humphrey promised to Roll Call:

Even without the labor federation endorsement, Cedillo, a former union organizer, has picked up some union support, and Derek Humphrey, his campaign manager, predicted the campaign would have “one of the most aggressive grass-roots [get out the vote] operations in Los Angeles County history.”

Turnout is also strikingly low so far–with 12,000 voters have returned their ballots so far, that’s less than .5% of the 245,000 voters (warning: PDF) that were registered in CA-32 as of the March 20 60-day close report.  My personal opinion is that the low turnout so far bodes well for Judy Chu, and seems to indicate what the two articles are stating: that the higher the turnout is, the more it favors Cedillo owing to simple demographic considerations.

Ethnic appeals in the campaign are also taking center stage, which makes perfect sense in this district.  Quoth Politico:

“The candidate who best identifies who their voters are, and gets them out to cast their ballot will win this thing,” said Allan Hoffenblum, publisher of the California Target Book, a nonpartisan guide that tracks statewide elections. “It’s between Chu and Cedillo as the two main contenders, … and they all agree on the issues, so this race has come down to ethnicity and character.”

True enough.  And, in fact, the Chu campaign is in fact accusing the Cedillo campaign of ethnicity-based campaigning.  From Roll Call:

Chu’s campaign believes Cedillo made a subtle appeal to Hispanic voters when he sent out a mailer recently tying Chu to shady Chinese businessmen. But will more blatant appeals to ethnic pride follow?

The Chu campaign isn’t the only outfit that has accused the Cedillo campaign of making racially motivated appeals.  The Calitics Editorial Board did the same thing (N.B. that this was written before I joined the board), especially in the context of the Pleitez mailer, which seemed to coincidentally feature pictures of Pleitez with white and African American women.

But if the Cedillo campaign is to be defended against these accusations, the truth of the matter is that given the context of the campaign, they don’t really have a choice if they want to win.  The Cedillo campaign is wedged between a candidate of a different ethnicity with certain crossover appeal and key endorsements on one side, and on the other side by an aggressive young candidate who is eating into the base that Cedillo needs.  If Cedillo is going to win, he’s going to have to do it by being the candidate from and for the Latino community and getting those voters out to the polls, which is no easy challenge.  I make no bones about saying that the strategies that the Cedillo campaign has been employing are personally distasteful.  But I also understand that given the current climate, that’s the path to victory.

That’s the news for today.  I will be occupied for most of tomorrow and unable to post a roundup, but I will be visiting the campaigns of Cedillo, Chu and Pleitez before election day to give a report from the ground about how the three major campaigns are going.