{"id":4564,"date":"2018-09-08T23:46:34","date_gmt":"2018-09-09T06:46:34","guid":{"rendered":"https:\/\/worldcampaign.net\/?p=4564"},"modified":"2018-09-09T03:23:08","modified_gmt":"2018-09-09T10:23:08","slug":"post1-13","status":"publish","type":"post","link":"https:\/\/worldcampaign.net\/?p=4564","title":{"rendered":"\u201cAmazon\u2019s Antitrust Antagonist Has a Breakthrough Idea\u201d, The New York Times"},"content":{"rendered":"
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With a single scholarly article, Lina Khan, 29, has reframed decades of monopoly law.<\/span>\u00a0<\/em><\/p>\n<\/div>\n

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By David Streitfeld,\u00a0<\/span>Sept. 7, 2018<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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The dead books are on the top floor of Southern Methodist University\u2019s law library.<\/p>\n

\u201cAntitrust Dilemma.\u201d \u201cThe Antitrust Impulse.\u201d \u201cAntitrust in an Expanding Economy.\u201d Shelf after shelf of volumes ignored for decades. There are a dozen fat tomes with transcripts of the congressional hearings on monopoly power in 1949, when the world was in ruins and the Soviets on the march. Lawmakers believed economic concentration would make America more vulnerable.<\/p>\n

At the end of the antitrust stacks is a table near the window. \u201cThis is my command post,\u201d said Lina Khan.<\/p>\n

It\u2019s nothing, really. A few books are piled up haphazardly next to a bottle with water and another with tea. Ms. Khan was in Dallas quite a bit over the last year, refining an argument about monopoly power that takes aim at one of the most admired, secretive and feared companies of our era: Amazon.<\/p>\n

The retailer overwhelmingly dominates online commerce, employs more than half a million people and powers much of the internet itself through its cloud computing division. On Tuesday, it briefly became the second company to be worth a trillion dollars<\/a>.<\/p>\n

If competitors tremble at Amazon\u2019s ambitions, consumers are mostly delighted by its speedy delivery and low prices. They stream its Oscar-winning movies and clamor for the company to build a second headquarters in their hometowns. Few of Amazon\u2019s customers, it is safe to say, spend much time thinking they need to be protected from it.<\/p>\n<\/div>\n<\/div>\n

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But then, until recently, no one worried about Facebook, Google or Twitter either. Now politicians, the media, academics and regulators are kicking around ideas that would, metaphorically or literally, cut them down to size. Members of Congress grilled social media executives on Wednesday<\/a> in yet another round of hearings on Capitol Hill. Not since the Department of Justice took on Microsoft in the mid-1990s has Big Tech been scrutinized like this.<\/p>\n

Amazon has more revenue than Facebook, Google and Twitter put together, but it has largely escaped sustained examination. That is beginning to change, and one significant reason is Ms. Khan.<\/p>\n

In early 2017, when she was an unknown law student, Ms. Khan published \u201cAmazon\u2019s Antitrust Paradox\u201d<\/a> in the Yale Law Journal. Her argument went against a consensus in antitrust circles that dates back to the 1970s \u2014 the moment when regulation was redefined to focus on consumer welfare, which is to say price. Since Amazon is renowned for its cut-rate deals, it would seem safe from federal intervention.<\/p>\n

Ms. Khan disagreed. Over 93 heavily footnoted pages, she presented the case that the company should not get a pass on anticompetitive behavior just because it makes customers happy. Once-robust monopoly laws have been marginalized, Ms. Khan wrote, and consequently Amazon is amassing structural power that lets it exert increasing control over many parts of the economy.<\/p>\n<\/div>\n<\/div>\n

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Amazon has so much data on so many customers, it is so willing to forgo profits, it is so aggressive and has so many advantages from its shipping and warehouse infrastructure that it exerts an influence much broader than its market share. It resembles the all-powerful railroads of the Progressive Era, Ms. Khan wrote: \u201cThe thousands of retailers and independent businesses that must ride Amazon\u2019s rails to reach market are increasingly dependent on their biggest competitor.\u201d<\/p>\n

The paper got 146,255 hits, a runaway best-seller in the world of legal treatises. That popularity has rocked the antitrust establishment, and is making an unlikely celebrity of Ms. Khan in the corridors of Washington.<\/p>\n

She has her own critics now: Several leading scholars have found fault with Ms. Khan\u2019s proposals to revive and expand antitrust, and some have tried to dismiss her paper with the mocking label \u201cHipster Antitrust.\u201d Unwilling or perhaps unable to accept that a woman wrote a breakthrough legal text, they keep talking about bearded dudes.<\/p>\n

Ms. Khan was born in London to Pakistani parents who emigrated to the United States when she was 11. She is now 29, an Amazon critic whose Amazon account is largely inactive, newly married to a Texas doctor who uses his Amazon Prime account all the time. Ms. Khan was supposed to move this summer to Los Angeles, where she had a clerkship with Stephen Reinhardt, the Ninth Circuit Court of Appeals judge and liberal icon, but he suddenly died in March<\/a>. Instead, Ms. Khan is set to start a fellowship at Columbia this fall, and is considering other projects as well. There is no shortage of parties that want her advice on how to reckon with Big Tech.<\/p>\n

\u201cAs consumers, as users, we love these tech companies,\u201d she said. \u201cBut as citizens, as workers, and as entrepreneurs, we recognize that their power is troubling. We need a new framework, a new vocabulary for how to assess and address their dominance.\u201d<\/p>\n

At the S.M.U. library in Dallas, Ms. Khan was finding that vocabulary. These dead books, many from an era that predated the price-based era of monopoly law, were an influence and an inspiration. She was planning to expand her essay into a book, she said in an interview here in June.<\/p>\n

Then her life shifted, and she abruptly went from an outsider proposing reform to an insider formulating policy. Rohit Chopra, a new Democratic commissioner at the Federal Trade Commission, pulled her in as a temporary adviser in July, at a time when urgent questions about privacy, data, competition and antitrust were suddenly in the air. The F.T.C. is holding a series of hearings this fall, the first of their type since 1995, on whether a changing economy requires changing enforcement attitudes.<\/p>\n<\/div>\n<\/div>\n

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The hearings will begin on Sept. 13<\/a> at Georgetown University Law Center. Two panels will debate whether antitrust should keep its narrow focus or, as Ms. Khan urges, expand its range.<\/p>\n

\u201cIdeas and assumptions that it was heretical to question are now openly being contested,\u201d she said. \u201cWe\u2019re finally beginning to examine how antitrust laws, which were rooted in deep suspicion of concentrated private power, now often promote it.\u201d<\/p>\n

Genuinely original voices are rare in Washington policy circles, and Mr. Chopra is pleased to have Ms. Khan in his camp. \u201cIt\u2019s rare to come across a legal prodigy like Lina Khan,\u201d he said. \u201cNothing about her career is typical. You don\u2019t see many law students publish groundbreaking legal research, or research that had such a deep impact so quickly.\u201d<\/p>\n

Then: Rockefeller. Now: Bezos.<\/strong><\/p>\n<\/div>\n<\/div>\n

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Ida Tarbell, the journalist whose investigation of Standard Oil helped bring about its breakup, wrote this about John D. Rockefeller<\/a> in 1905:<\/p>\n

\u201cIt takes time to crush men who are pursuing legitimate trade. But one of Mr. Rockefeller\u2019s most impressive characteristics is patience. \u2026 He was like a general who, besieging a city surrounded by fortified hills, views from a balloon the whole great field, and sees how, this point taken, that must fall; this hill reached, that fort is commanded. And nothing was too small: the corner grocery in Browntown, the humble refining still on Oil Creek, the shortest private pipeline. Nothing, for little things grow.\u201d<\/p>\n

When Ms. Khan read that, she thought: Jeff Bezos.<\/p>\n

Her Yale Law Journal paper argued that monopoly regulators who focus on consumer prices are thinking too short-term. In Ms. Khan\u2019s view, a company like Amazon \u2014 one that sells things, competes against others selling things, and owns the platform where the deals are done \u2014 has an inherent advantage that undermines fair competition.<\/p>\n<\/div>\n<\/div>\n

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\u201cThe long-term interests of consumers include product quality, variety and innovation \u2014 factors best promoted through both a robust competitive process and open markets,\u201d she wrote.<\/p>\n

The issue Ms. Khan\u2019s article really brought to the fore is this: Do we trust Amazon, or any large company, to create our future? In think tanks and universities, the battle has been joined.<\/p>\n

\u201cIt\u2019s one thing to say that antitrust enforcement has gotten far too weak,\u201d said Daniel Crane, a University of Michigan scholar who doesn\u2019t agree with Ms. Khan but credits her with opening up a much-needed debate. \u201cIt\u2019s a bridge much further to say we should go back to the populist goal of leveling playing fields and checking \u2018bigness.\u2019 \u201d<\/p>\n

As Mr. Crane writes in a forthcoming law review article<\/a>: \u201cAntitrust law stands at its most fluid and negotiable moment in a generation.\u201d<\/p>\n

The resistance is fierce and prominent. Herbert Hovenkamp, an antitrust expert at the University of Pennsylvania Law School, wrote that if companies like Amazon are targeted<\/a> simply because their low prices hurt competitors, we might \u201cquickly drive the economy back into the Stone Age, imposing hysterical costs on everyone.\u201d<\/p>\n

Timothy Muris, a former chairman of the F.T.C., and Jonathan Nuechterlein, a former F.T.C. general counsel, published a paper in June that was a response to Ms. Khan and the antitrust reform movement. Called \u201cAntitrust in the Internet Era,\u201d<\/a> it was about the A.&P. grocery chain.<\/p>\n

A.&P. essentially invented the modern supermarket in the 1920s. With its low prices, wide range of products and penchant for disruption, the chain became the leading retailer of its era. It owned 70 factories and eliminated middlemen, which allowed it to keep costs down. Yet, Mr. Muris and Mr. Nuechterlein wrote, \u201cA.&P.\u2019s very popularity triggered a backlash.\u201d The government pursued A.&P. on antitrust grounds during the 1940s, egged on by competitors that could not compete. After decades of decline, A.&P. shut its doors for good<\/a> in 2015.<\/p>\n<\/div>\n<\/div>\n

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The analogies with Amazon are explicit. Don\u2019t let the government pursue Amazon the way it pursued A.&P., Mr. Muris and Mr. Nuechterlein warned.<\/p>\n

\u201cAmazon has added hundreds of billions of dollars of value to the U.S. economy,\u201d they wrote. \u201cIt is a brilliant innovator\u201d whose \u201cbreakthroughs have in turn helped launch new waves of innovation across retail and technology sectors, to the great benefit of consumers.\u201d<\/p>\n

Amazon itself could not have made the argument any better. Which isn\u2019t surprising, because in a footnote on the first page, the authors noted: \u201cWe approached Amazon Inc. for funding to tell the story\u201d of A.&P., \u201cand we gratefully acknowledge its support.\u201d They added at the end of footnote 85: \u201cThe authors have advised Amazon on a variety of antitrust issues.\u201d<\/p>\n

Amazon declined to say how much its support came to in dollars. It also declined to comment on Ms. Khan or her paper directly, but issued a statement.<\/p>\n

\u201cWe operate in a diverse range of businesses, from retail and entertainment to consumer electronics and technology services, and we have intense and well-established competition in each of these areas,\u201d the company said. \u201cRetail is our largest business today and we represent less than 1 percent of global retail.\u201d<\/p>\n

\u2018We\u2019re at the Very Beginning of Solutions to This\u2019<\/strong><\/p>\n<\/div>\n<\/div>\n

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The first time Ms. Khan held power to account involved a Starbucks in suburban New York that was banning students from sitting down. Ms. Khan decided to write an article about the policy; Starbucks wouldn\u2019t answer her questions, but she managed to interview the employees. The New York Times picked up on the tempest<\/a>, leaning on her reporting. Ms. Khan was 15, a correspondent for her high school newspaper.<\/p>\n

Her father was a management consultant; her mother an executive in information services. Ms. Khan went to Williams College, where she wrote a thesis on the political philosopher Hannah Arendt. She was the editor of the student paper but worked hard at everything.<\/p>\n<\/div>\n<\/div>\n

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\u201cWe were routinely emailing each other on separate floors of the library as it was closing at 2 a.m.,\u201d said Amanda Korman, a classmate.<\/p>\n

Like many a wonkish youth, Ms. Khan headed to Washington after graduating in 2010, applying for a position at the left-leaning New America Foundation. Barry Lynn, who headed the organization\u2019s Open Markets antimonopoly initiative, seized on her application. \u201cIt\u2019s so much easier to teach public policy to people who already know how to write than teach writing to public policy experts,\u201d said Mr. Lynn, a former journalist.<\/p>\n

Ms. Khan wrote about industry consolidation and monopolistic practices for Washington publications that specialize in policy, went to Yale Law School, published her Amazon paper and then came back to Washington last year, just as interest was starting to swell in her work.<\/p>\n

In the summer of 2017, Open Markets was ejected from New America amid messy accusations that it displeased Google<\/a>, a prominent funder, after the company was rebuked by European regulators for anticompetitive behavior. The think tank is now independent.<\/p>\n

\u201cPolls show huge concerns about concentrated power, corporate power, but if people are asked, \u2018Do we have a monopoly problem?\u2019 they answer, \u2018I don\u2019t know,\u2019 \u201d said Mr. Lynn. \u201cThey don\u2019t have the language for it.\u201d<\/p>\n

Amazon\u2019s $14 billion purchase of Whole Foods<\/a> in the summer of 2017 \u2014 a startling move into physical retail \u2014 was almost a watershed, but not quite. Rep. David Cicilline of Rhode Island, the ranking Democrat on the Subcommittee on Regulatory Reform, Commercial and Antitrust Law, called for hearings but did not get them.<\/p>\n

\u201cThe whole country has been struggling to understand why the economy is not operating in the right way,\u201d Mr. Cicilline said. \u201cWages have remained stagnant. Workers have less and less power. All we\u2019re trying to do is create a level playing field, and that\u2019s harder when you have megacompanies that make it virtually impossible for small competitors.\u201d He added, \u201cWe\u2019re at the very beginning of solutions to this.\u201d<\/p>\n<\/div>\n<\/div>\n

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Somewhere in the midst of all this, Ms. Khan found the time to marry Shah Ali, a doctor now doing a cardiology fellowship in Dallas, which explains why she was camping out at the S.M.U. law library. The honeymoon was in Hawaii. Dr. Ali took Jane Austen\u2019s \u201cPersuasion,\u201d because he hadn\u2019t reread it in a while. Ms. Khan brought a book on corporations and American democracy.<\/p>\n

\u2018The New Brandeisians\u2019 Lacks a Certain Something<\/strong><\/p>\n<\/div>\n<\/div>\n

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The battle for intellectual supremacy takes place less these days in learned journals and more on social media, where tongues are sharp and branding is all. This is not Ms. Khan\u2019s strong suit. She is always polite, even on Twitter. One consequence is that she didn\u2019t give much thought about what to call the movement to reboot antitrust. Neither did anyone else.<\/p>\n

That presented an opening for the reformers\u2019 critics, who have tried with a limited degree of success to popularize the term \u201cHipster Antitrust.\u201d Konstantin Medvedovsky, an antitrust lawyer in New York, came up with the label last summer in a tweet<\/a> that was responding to a tweet that was responding to a tweet by Ms. Khan.<\/p>\n

\u201cAntitrust Hipsterism,\u201d he wrote. \u201cEverything old is cool again.\u201d<\/p>\n

Mr. Medvedovsky, who calls Ms. Khan\u2019s article \u201cthe face of this movement,\u201d said the term was designed to be \u201cplayful rather than pejorative.\u201d<\/p>\n

Admirers of Ms. Khan and her fellow reformers have sometimes called them the New Brandeis School or the New Brandeisians, after Louis Brandeis, the Progressive Era foe of big business. As brands go, these are somewhat less catchy than \u201cHipster Antitrust.\u201d<\/p>\n

The April issue of the journal Antitrust Chronicle<\/a>, edited by Mr. Medvedovsky, features a drawing of a bearded man on the cover right above the words \u201cHipster Antitrust.\u201d In the middle of an article by Philip Marsden, a professor of competition law and economics at the College of Europe in Bruges, there\u2019s a photograph of a bearded man taking a selfie next to the chapter heading \u201cBattle of the Beards.\u201d It is perhaps relevant that only one of the 12 authors or experts in the issue is female.<\/p>\n<\/div>\n<\/div>\n

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The Hipster issue was sponsored by Facebook, another sign that Big Tech is striving to shape the monopoly-law debate. The company declined to comment.<\/p>\n

Things are moving fast, so there is a lot to write papers about.<\/p>\n

Mr. Chopra, with Ms. Khan\u2019s assistance, pushed the argument further on Sept. 6 with a 14-page official comment<\/a> that suggested the F.T.C. bring back a tool buried in its toolbox: the ability to make rules.<\/p>\n

Contemporary antitrust regulation, the commissioner wrote, is conducted in the courts, which makes it numbingly slow and dependent on high-paid expert witnesses. He called for the agency to use its authority to issue rules that would \u201cadvance clarity and certainty\u201d about what is, and what is not, an unfair method of competition.<\/p>\n

These rules would not be \u201csome inflexible prescription\u201d but standards, guidelines, pointers or presumptions, he wrote. Since everyone affected by a proposed rule would have the opportunity to weigh in on it, the process would be more democratic.<\/p>\n

There is more than an echo here of Ms. Khan\u2019s notion that the past can help rescue the future.<\/p>\n

\u201cThese are new technologies and new business models,\u201d Ms. Khan said. \u201cThe remedy is new thinking that is informed by traditional principles.\u201d<\/p>\n

Antitrust Foot Soldiers<\/strong><\/p>\n

Big Tech\u2019s great strength is that it is everywhere. Hardly anyone can live without it<\/a>. But that omnipresence can be a weakness too. Just ask Facebook. It was the only global social media network, an enviable position \u2014 until it wasn\u2019t. Ideas for regulating Facebook that were once unimaginable are now on the table.<\/p>\n

Ms. Khan was not the first to criticize Amazon, and she said the company was not really her target anyway. \u201cAmazon is not the problem \u2014 the state of the law is the problem, and Amazon depicts that in an elegant way,\u201d she said.<\/p>\n<\/div>\n<\/div>\n

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From Amazon\u2019s point of view, however, it is a problem indeed that Ms. Khan concludes in the Yale paper that regulating parts of the company like a utility \u201ccould make sense.\u201d She also said it \u201ccould make sense\u201d to treat Amazon\u2019s e-commerce operation like a bridge, highway, port, power grid or telephone network \u2014 all of which are required to allow access to their infrastructure on a nondiscriminatory basis.<\/p>\n

Ms. Khan put those ideas out there, which is how Rachel Tsuna found them.<\/p>\n

Last fall, the Barnard College senior was casting about for a subject for her senior thesis. \u201cWhat is really interesting to you?\u201d her adviser asked. Ms. Tsuna, now 22, had worked for a chewing gum start-up \u2014 yes, there are such things \u2014 that sold through Amazon, and knew firsthand the retailer\u2019s tight grip. \u201cAmazon is scary!\u201d she exclaimed.<\/p>\n

This impulsive declaration suggested a topic: Did the F.T.C. have the grounds to move against Amazon? Ms. Tsuna made little progress until she came across Ms. Khan\u2019s paper.<\/p>\n

\u201cI finally felt like I was pursuing something valid,\u201d Ms. Tsuna said. \u201cLina Khan gave me the confidence I needed.\u201d The thesis, which is quite fair to Amazon, got an A minus.<\/p>\n

That\u2019s the way movements begin. Little things grow.<\/p>\n

\u201cThis is a moment in time that invites a movement,\u201d said Ms. Khan. \u201cIt\u2019s bigger than antitrust, bigger than Big Tech. It\u2019s about whether the laws serve democratic ends.\u201d<\/p>\n

It was late at night in late July, and she was eating a burrata concoction at a popular restaurant near the Washington apartment she uses when not in Texas with her husband. After the death of Judge Reinhardt, her options opened up. She had the Columbia fellowship. Maybe she would also write the book. Or go back to the F.T.C. full time. Or somehow do it all.<\/p>\n<\/div>\n<\/div>\n

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\u201cAmazon is a monopoly, and I worry that it monopolizes Lina,\u201d said her husband, Dr. Ali. \u201cI learn about what she is doing from looking at her Twitter feed.\u201d<\/p>\n

\u201cI throw myself into things,\u201d Ms. Khan agreed. \u201cMy life is spread out now.\u201d<\/p>\n

With some cajoling, she revealed her Amazon account. There were just three purchases in 18 months. An altimeter for her father, who has taken up hiking, is the only one she will agree to have mentioned, although the other two are incredibly benign. One attribute Ms. Khan shares with Amazon is a strong desire to control the flow of information.<\/p>\n

Somewhat to her surprise, she is becoming a public figure. Before beginning her stint at the F.T.C., she said the news of her working there might be no more than a sentence or two at news sites that cover policy intensively. Instead it was a full-fledged story. The Information, a tech news site, declared: \u201cAmazon Antitrust Push Slowly Gains Ground.\u201d<\/a>Politico just named her one of the Politico 50,<\/a> its annual list of the people driving the ideas driving politics.<\/p>\n

Balancing the attention and the achievement, the expectations and the demands, is difficult, perhaps impossible.<\/p>\n

\u201cI don\u2019t think of my work in grandiose terms. I feel an urgency but I\u2019m also wary of hubris,\u201d Ms. Khan said. \u201cNobody has been expecting this to succeed. I\u2019m awed by the challenge.\u201d<\/p>\n

The New York Times<\/a><\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

With a single scholarly article, Lina Khan, 29, has reframed decades of monopoly law.\u00a0 By David Streitfeld,\u00a0Sept. 7, 2018 The dead books are on the top floor of Southern Methodist University\u2019s law library. \u201cAntitrust Dilemma.\u201d \u201cThe Antitrust Impulse.\u201d \u201cAntitrust in an Expanding Economy.\u201d Shelf after shelf of volumes ignored for decades. There are a dozen […]<\/p>\n","protected":false},"author":1001004,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[53],"tags":[],"_links":{"self":[{"href":"https:\/\/worldcampaign.net\/index.php?rest_route=\/wp\/v2\/posts\/4564"}],"collection":[{"href":"https:\/\/worldcampaign.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/worldcampaign.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/worldcampaign.net\/index.php?rest_route=\/wp\/v2\/users\/1001004"}],"replies":[{"embeddable":true,"href":"https:\/\/worldcampaign.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4564"}],"version-history":[{"count":2,"href":"https:\/\/worldcampaign.net\/index.php?rest_route=\/wp\/v2\/posts\/4564\/revisions"}],"predecessor-version":[{"id":4579,"href":"https:\/\/worldcampaign.net\/index.php?rest_route=\/wp\/v2\/posts\/4564\/revisions\/4579"}],"wp:attachment":[{"href":"https:\/\/worldcampaign.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4564"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/worldcampaign.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4564"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/worldcampaign.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4564"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}