VIDEO04:03

FTC Chair Lina Khan: What best produces breakthrough innovations is competition

Antitrust enforcement, rather than the absence of it, can better position the U.S. to stay ahead of China in the race to build cutting-edge technologies, Federal Trade Commission Chair Lina Khan said on CNBC’s “Squawk Box” Wednesday.

The tech industry often points to the threat of China catching up to U.S. technologies as an argument against more aggressive enforcement against them. For example, after the FTC proposed barring Meta from monetizing kids’ data for allegedly violating an earlier privacy agreement, Meta spokesperson Andy Stone tweeted in part that it was an example of the FTC trying to “single out one American company while allowing Chinese companies, like Tik Tok, to operate without constraint on American soil.” The FTC also has a privacy agreement in place from 2019 with TikTok over alleged violations.

Khan said Wednesday that lessons of the past suggest more aggressive enforcement at home will actually benefit the U.S. on the international stage.

“What history and experience have shown us is what best positions the United States to compete internationally, to stay ahead internationally, is making sure that we are a home for innovation,” Khan said in an interview with CNBC’s Andrew Ross Sorkin. “And what best produces breakthrough innovations, cutting edge technologies, is competition. I think we’ve seen time and time again monopolies and incumbent firms arguing that they need to preserve their monopoly to make sure that the U.S. stays ahead. But historically the U.S. has instead enforced competition laws, enforced antitrust and that is what has led us to be the home of cutting-edge technologies.”

Khan offered an example of two historic tech antitrust cases in the last century, those of IBM and AT&T. In AT&T’s case, Khan noted that the government’s requirement that the telecom firm open its “patent vault ... led to decades and decades of innovation.”

“I think we saw that Silicon Valley was birthed in the wake of strong competition and antitrust enforcement,” Khan added. “And so I think we need to be very wary of arguments that it’s really monopoly that’s going to best position us to thrive internationally when time and time again we’ve seen the exact opposite.”

Subscribe to CNBC on YouTube.

WATCH: How US antitrust law works, and what it means for Big Tech