Hello again,
This month brought about big news in the antitrust world, with the upcoming departure of Christine Wilson, the FTC’s lone Republican commissioner. Wilson announced her exit in a scathing Wall Street Journal op-ed, accusing FTC Chair Lina Khan of dishonesty, subterfuge, and violating due process in her running of the agency. These allegations may impact the agency’s legitimacy in the eyes of Congress. Wilson spoke at Mercatus’s 2nd Annual Antitrust Forum last month. For those of you who couldn’t make it, I’ve included a link to a video recording of the sessions. You can also read my top 7 takeaways from this year’s forum here. We hope to see you there next year.
It has been a busy month for the team here at Mercatus, with the release of several new policy briefs exploring subjects as diverse as sensible approaches to child privacy protection laws, and California’s attempts to get around federal antitrust jurisprudence using state legislation in their pursuit of claims against Amazon.
Andrew Mercado and I assess how successful the Biden-era FTC and DoJ’s attempts to instill a paradigmatic shift in longstanding antitrust enforcement norms have been and are likely to be going forward in our latest policy brief. I also recently wrote for Truth on The Market on the implications of aggressive anti-merger enforcement efforts for American innovation, and on problematic state laws that mandate the licensing of digital copyrighted works. We’ve also released an insightful brief from former DoJ economist and an architect of our current merger guidelines, Dr. Gregory Werden, on how introducing subjective political considerations into antitrust policy, as FTC Chair Khan and AAG Jonathan Kanter have promised to do, doesn’t just reduce economic efficiency and harm consumers. It also threatens to undermine the rule of law itself.
On February 22, I was a panelist at an ABA Antitrust Section webinar on “The Potential FTC Impact of Post-Axon Process Changes.” The other three speakers and I explored the huge implications for the FTC of the Supreme Court’s imminent decision in the Axon case, which will address whether administrative litigants can seek early judicial review of the constitutionality of the Commission’s administrative process.
Finally, on February 20th, I was delighted to welcome Satya Marar as a Visiting Postgraduate Fellow on the Mercatus Center competition policy team.
Articles
Mergers and Innovation: DOJ and FTC Take Heed | Truth on the Market
Alden Abbott, 15 February 2023
Despite longstanding consensus to the contrary among economists and policymakers, DoJ and FTC leadership are increasingly questioning whether mergers are economically beneficial and promote innovation. In this commentary for Truth on the Market, I analyze the latest empirical research and argue that American innovation and international competitiveness will be best served if the FTC adopts sensible new merger guidelines recognizing the benefits of pro-competitive mergers.
State-Mandated Digital Book Licenses Offend the Constitution and Undermine Free-Market Principles | Truth on the Market
Alden Abbott, 14 February 2023
Various states recently have enacted legislation that requires authors, publishers, and other copyright holders to license to lending libraries digital texts, including e-books and audio books. These laws violate the Constitution’s conferral on Congress of the exclusive authority to set national copyright law. Furthermore, as a policy matter, they offend free-market principles.
Events
Mercatus Center’s 2nd Annual Antitrust Forum: Policy in Transition
On January 26, 2023, Mercatus Center hosted its 2nd annual antitrust forum at George Mason University. Discussions covered the state of antitrust enforcement policy in the United States and overseas during the second year of the Biden Administration, with a focus on the legal and economic policy implications of major enforcement, legislative and policy initiatives to come. Featured speakers included several former and current leaders of the FTC and DoJ. You can view a recording of the conference here.
Policy Briefs
Protecting Children Online: Evaluating Possible Reforms in the Law and the Application of COPPA | Mercatus Center
Tracy Miller, 20 February 2023
Attempts to improve privacy protections online for children and teens by FTC regulation or statute often do more harm than good. In this policy brief, Tracy Miller analyzes the history and operation of the 1998 Children’s Online Privacy Protection Act (COPPA) and explores possible directions for future policy in light of tradeoffs between the quality of online services, free speech rights and children’s privacy.
Antitrust Enforcement and the Rule of Law | Mercatus Center
Gregory J. Werden, 3 February 2023
Dr. Gregory Werden charts the history and development of American antitrust enforcement with respect to the rule of law. He argues that the rule of law will be compromised by current FTC Chair Lina Khan and AAG Jonathan Kanter’s plans to modify the existing guidelines to de-emphasize economic analysis and introduce amorphous considerations that go beyond impact on competition.
Developments in Competition Policy during the Second Year of the Biden Administration | Mercatus Center
Alden Abbott & Andrew Mercado, 25 January 2023
Andrew Mercado and I canvass the Biden-era FTC and DOJ’s policy, litigation and enforcement efforts in 2022 following the failure of several antitrust legislative reforms to make it through Congress. Despite talking a tough game based on theories outside mainstream antitrust thinking, the agencies’ efforts to more aggressively police mergers in court and elsewhere have largely fallen flat. The DOJ and the FTC should reflect on the likely judicial reception of new joint merger guidelines before releasing a draft that strays far from existing merger analysis norms.
California May Be Trying to Evade the Consumer Welfare Standard in Its Antitrust Lawsuit against Amazon | Mercatus Center
Ted Bolema, 23 January 2023
Facing difficulties in proving that retail giant Amazon’s price parity policies harm rather than benefit consumers, California Attorney General Rob Bonta is instead resorting to state statute which, unlike federal antitrust law, doesn’t require him to show real harm to consumer welfare. Ted Bolema explains why a win against Amazon in California will undermine the principle that antitrust decisions should be based on sound economic analysis and what’s best for competition and consumers, rather than on political considerations or shielding business from competition.