The Federal Trade Commission (FTC) has just signalled how the federal cost cutting being carried out by Elon Musk and DOGE is hampering its regulatory duties.
The FTC is currently carrying out a number of investigations or lawsuits against Amazon. The FTC for example sued Amazon in June 2023 over allegations it “knowingly duped millions of consumers into unknowingly enrolling in Amazon Prime”.
The FTC had accused the e-commerce giant of using “manipulative, coercive, or deceptive user-interface designs known as ‘dark patterns’ to trick consumers into enrolling in automatically-renewing Prime subscriptions.”
FTC lawsuit
The FTC also publicly named three senior Amazon executives, who it alleged took part in the “years-long effort to enroll consumers into its Prime program without their consent while knowingly making it difficult for consumers to cancel their Prime subscriptions.”
In October 2023 Amazon defended itself against the FTC allegations, and asked a US judge in Seattle to dismiss the FTC lawsuit that it said “fails in its entirety.”
Fast forward nearly years and Musk and DOGE are currently axing the federal workforce (62,000 federal workers were fired in February alone), despite the wages of federal employees accounting for between 5 to 15 percent of the federal budget.
“Severe resource shortfalls”
This it seems that the FTC has been left short-staffed and with no cash to conduct it regulatory duties.
CNBC reported that the FTC on Wednesday asked a federal court in Seattle to delay a September trial in its case alleging Amazon misled consumers over its Prime subscription service, citing “severe resource shortfalls in terms of both money and personnel.”
“We have lost employees in the agency, in our division and on our case team,” Cohen told US District Judge John Chun.
Judge Chun reportedly asked Cohen how the FTC’s situation “will be different in two months” if the agency is “in crisis now, as far as resources.”
Cohen responded by saying that he “cannot guarantee if things won’t be even worse.”
Moving offices
Cohen reportedly pointed to the possibility that the FTC may have to move to another office “unexpectedly,” which could hamper its ability to prepare for the trial.
DOGE and Musk had last week put the FBI headquarters and other buildings housing federal agencies up for possible sale, before taking the list down.
And some federal employees on the case took a resignation offer sent out in January, and others resigned for other reasons, or are scheduled to be on leave during the trial, and their positions cannot be filled due to a hiring freeze, Cohen reportedly said.
Cohen also reportedly cited new spending restrictions limiting FTC attorneys to purchasing transcripts of court proceedings and depositions on the slowest delivery schedule, which carries the cheapest rate but can take weeks to arrive.
US Oligarchy?
The FTC brought a separate case against Amazon in September 2023 accusing it of wielding an illegal monopoly.
The US agency alleged that Amazon prevents sellers from offering cheaper prices elsewhere through its anti-discounting measures.
That case is set to go to trial in October 2026.
It should be remembered that tech companies, which are the target of several regulatory agencies, had sought to curry favour with US president Donald Trump.
This included Amazon founder and executive chairman Jeff Bezos, as well as many other CEOs from leading tech giants.
Bezos had attended President Donald Trump’s inauguration in January, and Amazon was among a number of tech companies to donate $1 million to Trump’s inauguration committee.
