Biden’s Antitrust Team Signs a Big Swing on Corporate Titans


WASHINGTON — President Biden has put together the most aggressive antitrust team in decades, stacking his administration with three legal crusaders as he prepares to assume corporate consolidation and market power through efforts that may include curbing mergers and breaking up big corporations.

Mr. Biden’s decision last week name Jonathan Kanter Leading the Justice Department’s antitrust division is the latest sign of a willingness to clash with corporate America to foster greater competition in the tech industry and economy. Mr. Kanter has spent years as a lawyer fighting giants like Facebook and Google on behalf of rival companies.

If approved by the Senate, he will join Lina Khan, who helped. reframing the academic debate on antitrust and now leads the Federal Trade Commission, and Tim Wu is a Longtime advocate of leaving Facebook and other large companies who are now the president’s special assistant for technology and competition policy.

The appointments show both the Democratic Party’s renewed antitrust activism and the Biden administration’s growing concern that the concentration of power in technology, as well as other sectors such as pharmaceuticals, agriculture, healthcare and finance, is hurting consumers and workers and stifling economic growth.

They also underline that Mr. Biden is willing to use the power of his office and does not await the more difficult phase of congressional action, which is both a faster and potentially riskier approach. this month, it issued an executive order It’s full of 72 initiatives to fuel competition in various industries, get more scrutiny of mergers, and restrict the widespread practice of forcing workers to sign non-compete agreements.

Outside groups and the administration’s ideological allies warn that if Mr. Biden truly hopes to follow in the footsteps of his antitrust idols, Presidents Theodore Roosevelt and Franklin D. Roosevelt, it will need to push through sweeping legislation to give federal regulators new powers. especially in the technology sector. Fundamental federal antitrust laws, written over a century ago, did not envision The type of business that exists today, in which large companies can offer their customers low prices, but at the expense of competition.

The administration has quietly supported the bills moving forward in the House, but has yet to attempt to spearhead a congressional antitrust crackdown in the way Mr. Biden has done on infrastructure, childcare and other components of his $4 trillion economic agenda.

This could be problematic if judges continue to block the actions of the Justice Department, the FTC, or other agencies.

Last month, a federal judge filed an FTC lawsuit against Facebook, saying the agency failed to provide a convincing argument that the company was a monopoly, leading it to better justify its claims. Ms. Khan faces her first big test when she reopens the case, and on Friday the agency asked the court for additional time.

Biden’s antitrust choices argued that Facebook, Google and Amazon have monopoly power and are using their dominant positions in social media, search and online retail to crush competitors, leaving consumers with less choice if not higher costs. .

Companies and some economists disagree. Facebook cites TikTok, Snap and Twitter and Amazon as examples of competitors argues that it has only 5 percent of all retail sales In the US, despite an eMarketer research study showing that 40 percent of all online retail sales occur on its platform.

The president and his aides have used his “confidence buster” mentality as an important step towards rebalancing the economy, not only to lower prices, but also to fuel more competition and create higher-paying jobs.

As Mr. Biden introduced the executive order to a CNN viewer in Ohio on Wednesday, I always thought, “It’s not that the free market system is just competition between companies, guess what: Companies have to compete for workers.” “Guess what – maybe they’ll pay more.”

White House officials argue that putting hard-headed regulators into positions of power could enable them to succeed in their antitrust efforts, as did President Donald J. Trump, who issued an executive order on competition and talked about disrupting tech and hospital mergers. immortality.

“We are hopeful,” said Diana Moss, president of the American Antitrust Institute and an advocate for stronger competition. “But when the tire meets the road, they will have to deal with an aggressive agenda with the realities of the courts, Congress and pressure from outside.”

Some economists warn that Mr. Biden’s appointees may enter industries such as restaurants or grocery stores, going beyond their efforts to break the concentration that truly stifles competition and harms consumers. There, they say, the entry of national players into local markets in many cases gives customers more choice and creates more jobs.

“I’m most concerned about rhetoric,” said economist Chang-Tai Hsieh of the University of Chicago. whose research found Some corporate concentration in recent years has produced innovations that strengthen the economy, he said. “They look at what they see in the tech industry – and the tech industry is different. And they make predictions from the tech industry to every other industry.”

Corporate America is already struggling with Mr. Biden’s efforts. There are Google, Facebook and Amazon has filled its legal teams with antitrust experts and has recruited senior government antitrust officials in recent years. Facebook and Amazon have petitioned Mrs. Khan to drop the antitrust issues regarding their company. They say digital platforms come with prejudices about the companies of Ms. Khan, who is working on a House antitrust investigation. Critics of Mr. Kanter, a private antitrust attorney, point to his representation of Microsoft and News Corp as a conflict of interest as the Justice Department continues its court battle against Google.

Mr. Biden’s moves reflect the growing influence of a move to curb corporate power that has spread from progressive academics and liberal leaders like Massachusetts Senator Elizabeth Warren to some of the most conservative Republicans in Congress.

Thomas Philippon, an economist at New York University, concluded in 2019 increased market concentration harming the US economy and costing the typical American economy $5,000 a year. Administration officials repeatedly refer to this statistic in support of Mr. Biden’s latest executive order.

Working to break market concentration and encourage competition “could make a tremendous difference in the lives of millions of people in this country,” says Bharat Ramamurti, deputy director of Mr. Biden’s National Economic Council and a former aide to Ms. Warren. he said in an interview.

Mr Ramamurti touched on the potential benefits of not only breaking up companies, but also helping consumers have more and cheaper options to check accounts, allowing hearing aids to be sold over the counter and limiting company restrictions on whether employees can work for a competitor.

The approach contrasts sharply with that of regulators during the Obama administration, when Mr Biden was vice president.

During President Barack Obama’s first term, the number of hospitals combined quadrupled, leaving millions of patients with fewer options and higher prices for medical care.

In 2011, regulators approved Comcast’s merger with NBCUniversal – combining a powerful cable and internet provider with a media giant – on terms that the company’s own vice president, David Cohen, refused. It’s not “particularly restrictive”.

Only one in three Democrats on the Federal Communications Commission opposed the deal, and Christine Varney, head of antitrust at the Justice Department, said the merger would “bring new and innovative products to market and give consumers more programming options.”

In 2016, Tom Vilsack, Mr. Obama’s agriculture secretary, who took that role again for Mr. Biden, downplayed the harms of agrarian mergers.

“I don’t think it’s just because a few big players would potentially merge or consider some other arrangement that absolutely guarantees that farmers will have fewer options in the long run,” said Mr Vilsack. aforementioned In an interview with USA Today.

Mr. Biden has led federal regulators to consider a tougher line against corporate consolidation in hospitals, health insurance, meat processing and technology, which may include reconsidering approved past mergers.

And its antitrust regulators are trying to unravel mergers approved during the Obama years. The Federal Trade Commission’s latest lawsuit to split Facebook focuses on the company’s acquisitions of Instagram in 2012 and WhatsApp in 2014. The agency did not prevent mergers, saying it saw insufficient evidence that it harmed consumers and competition.

These decisions haunted the FTC. The federal judge, who dismissed Facebook’s complaint in June, questioned the situation and why the commission had taken so long to resolve these deals.

Courts have become increasingly conservative in antitrust cases, holding more to the belief that high prices are the strongest sign of competition violations.

Administration officials accept the challenge and say they are examining the antitrust views of prospective judicial candidates, in hopes of bending the courts towards a more sympathetic view of their efforts to thwart mergers and break up monopolies.


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