Senior Vice President, International Regulatory Affairs & Antitrust, U.S. Chamber of Commerce
June 15, 2023
For roughly the past fifty years, the enforcement of America’s antitrust laws has largely been dependent upon economic and factual analysis, rather than political factors, and focused predominantly on whether or not consumers are harmed by certain economic behaviors.
Now though, some are looking to turn back the clock on America’s antitrust laws and return to a precedent where politicians – not expert economic and legal analysis – micromanage the market. For example, one would not want to see pro-union views force merging companies to unionize their workers, while anti-union views break-up union workforces as a condition of being allowed to merge. Merger policy based on political objectives would be disastrous, and not just for consumers and businesses.
Tim Wu – a prominent legal scholar and former member of President Biden’s National Economic Council – argues in a recent paper that American antitrust enforcement suffers from what he calls a “democratic deficit,” and that the President of the United States ought to have much more leeway in determining antitrust enforcement outcomes than as is currently the norm.
The logic presented in Mr. Wu’s argument suggests in a democracy, the people control economic policy. And, because the president is an elected official with a national constituency, and because competition and the structure of the economy are important economic matters, the president ought to play a significant role in antitrust enforcement. Presidents, Wu argues, should be endowed with the authority to approve or deny company mergers and even order the dissolution of companies.
This perspective is sadly consistent with the view that government knows best how to manage economic activity and what consumers want and need. This runs counter to the consumer-oriented view that has long guided antitrust enforcement and has sought to insulate enforcement from politicization.
Mr. Wu’s notion of an all-powerful president only adds to the “democratic deficit” in antitrust law. It also ignores the role of Congress that is at the heart of our representative democracy. Congress sets the laws, and the antitrust laws are grounded in a professional, apolitical approach to economic evidence. An inconvenient truth that Mr. Wu seeks to overturn by further empowering the president.
For their part, members of Congress are disinterested in altering antitrust law. Numerous legislative proposals have been introduced in both the House and Senate in recent years. The fact that these proposals have failed to gain traction and not become law is, if anything, dispositive of democratic representation.
Should the president be granted more authority to dictate antitrust outcomes companies looking to invest and grow their businesses could not rely on a stable legal regime across presidential administrations. What one president may see as permissible; another may decry as illegal. Against this backdrop, company investment and competition would inevitably decrease. Worse yet, such concentration of power in one individual as Mr. Wu suggests would enable the very deficit in our democracy that he seeks to avoid.