Deconstructing the Worldview of the Neo-Brandeisians Through Marxism and Critical Legal Studies

Category: Print Issues

Deconstructing the Worldview of the Neo-Brandeisians Through Marxism and Critical Legal Studies

Christine S. Wilson & Adam S. Cella

Volume 29

, Issue 4

29 GEO. MASON L. REV. 961 (2022)

Introduction

Democrat Robert Pitofsky served as Chairman of the Federal Trade Commission (“FTC” or “Commission”) from 1995 to 2001.¹ When Republican Timothy J. Muris took the FTC helm following Chairman Pitofsky’s departure, some observers expressed hope that merger enforcement would decline substantially under Republican leadership.² In his first speech as FTC Chair, Muris dashed those hopes.³ Instead, he emphasized that his tenure would be characterized by continuity, with “changes at the margins.”⁴ Continuity should not come as a surprise, he explained, given “widespread agreement that the purpose of antitrust is to protect consumers, that economic analysis should guide case selection, and that horizontal cases . . . are the mainstays of antitrust.”⁵

Long after Chairman Muris delivered his first speech in 2001, the bipartisan consensus regarding the appropriate analytical framework for antitrust enforcement persisted. Of course, antitrust has evolved in the ensuing years—enforcers have incorporated new economic learning into their analytical frameworks, courts have developed new legal precedent, and both law and economics have been applied to dynamic and evolving markets. In other words, the field is not static, and it is not meant to be, as the Supreme Court observed in Kimble v. Marvel Entertainment, LLC.⁶

Moreover, serious antitrust thinkers can and do disagree about whether to focus on avoiding Type 1 (false positive) or Type 2 (false negative) errors.⁷ In other words, reasonable disagreement exists regarding whether antitrust enforcers should be more concerned about challenging procompetitive conduct as a violation of the antitrust laws (a Type I error) or taking a pass on challenging potentially anticompetitive conduct in an attempt to avoid chilling beneficial conduct (a Type II error).⁸ Several notable antitrust experts and former government officials advocate for more aggressive enforcement, including Carl Shapiro and Fiona Scott Morton, both of whom served as Deputy Assistant Attorney General for Economics at the Antitrust Division of the U.S. Department of Justice; former FTC Bureau of Economics Director Jonathan Baker; and Professor Steve Salop of Georgetown University Law Center.⁹ But these and many other proponents of more aggressive antitrust enforcement would continue to ground antitrust enforcement in economic principles.¹⁰

In recent years, though, developments have signaled a potential unraveling of this consensus. Commentators urged the abandonment of the consumer welfare standard,¹¹ which has long served as the touchstone for antitrust enforcement not just in the United States but globally.¹² Democrats in the U.S. Senate issued the Better Deal, which proposed to flip the burden of proof for “the largest mergers” by making them “presumed to be anticompetitive.”¹³ Then-Professor Tim Wu published The Curse of Bigness: Antitrust in the New Gilded Age, which asserted that antitrust law “has lost sight of its goals” and “failed in its core mission.”¹⁴ Then-sitting FTC Commissioner Rohit Chopra criticized the FTC and its staff continuously, publicly, and in vitriolic terms, even labelling the FTC as “lax.”¹⁵ Despite the failure of massive regulatory regimes,¹⁶ commentators began to praise those regimes and suggest that similar regulations be applied to Big Tech.¹⁷ The House Judiciary Committee, ostensibly focused on large tech companies, issued proposals that extended far beyond Big Tech—calling more generally for reinvigoration of the essential facilities doctrine, removal of the recoupment prong for predatory pricing, and so on.¹⁸ And when Chair Lina Khan arrived at the FTC, she immediately jettisoned traditional procedures and norms that had facilitated both bipartisanship and sound decision-making.¹⁹

These developments have occurred against a backdrop of accusations levied at the antitrust community. Defenders of the bipartisan consensus approach have been labeled as not just wrong, but evil and corrupt.²⁰ A prime example of this condemnation occurred at the 2022 Antitrust Section Spring Meeting of the American Bar Association. During the Chair’s Showcase, Barry Lynn, the Executive Director of the Open Markets Institute and a key mentor of Chair Khan’s, “rattled off a list of social ills, including outsized influence of tech companies, environmental problems and wealth inequality,” and told attendees that “[t]his all—to a great degree—is your doing. It is your doing because you conspired to use a false science, an idiot science, to blind the law to dangerous concentrations of power, to blind the citizenry to the fist of monopoly.”²¹ Another journalist reported that Barry Lynn “took to the stage and accused everyone in the meeting hall of working to take down American Democracy via their support of the consumer welfare standard. Lynn compared antitrust practitioners to Vladimir Putin and Xi Jinping. It was all quite something to behold.”²² Professor Zephyr Teachout, a co-panelist with Lynn and fellow mentor of Chair Khan’s, conveyed the same themes in somewhat more diplomatic terms.²³

At first glance, these varied developments may seem unrelated. But this Article offers a hypothesis: these developments are attributable to a unifying worldview that draws heavily on concepts from Marxism and Critical Legal Studies. To support this hypothesis, the Article examines a variety of concepts through the lenses of Western Liberal thought, Marxism, Critical Legal Studies (“CLS”), and the Neo-Brandeisians.²⁴

Part I discusses the Neo-Brandeisians’ apparent contempt for key concepts that undergird classical liberalism, including the rule of law and due process, a disdain they share with Marxists and CLS scholars. Part II identifies parallels among Neo-Brandeisian, Marxist, and CLS views with respect to additional economic and political issues. Finally, Part III discusses the perspective of Marx and his theoretical forebears on the benefits of destruction and revolution, and hypothesizes that this view may explain the Neo-Brandeisians’ willingness to inflict harm on the FTC as an institution.

I. Neo-Brandeisian Rejection of Classical Liberalism

Part I discusses the Neo-Brandeisian criticisms of core classical liberalism principles, specifically rule of law and due process. The Neo-Brandeisian view shares this belief with Marxist and CLS scholars, suggesting a common view that rejects rule of law and due process.

A. Rule of Law

The founders of the United States grounded our country in the key tenets of classical liberalism: individual rights, consent of the governed, periodic elections, public deliberation, democracy, equality, guaranteed liberties, and branches of government that check and balance one another.²⁵ These principles are enshrined in our Constitution and enforced by judges under the rule of law, another key tenet of classical liberalism.²⁶ The rule of law is “a principle under which all persons, institutions, and entities are accountable to laws that are: [p]ublicly promulgated[,] [e]qually enforced[,] [i]ndependently adjudicated[,] [a]nd consistent with international human rights principles.”²⁷ Friedrich Hayek described the rule of law as binding the government to “rules fixed and announced beforehand—rules which make it possible to foresee with fair certainty how the authority will use its coercive power in given circumstances.”²⁸

While our civics classes taught us to prize the rule of law, Marxists have a very different view. Marx characterized society in terms of its “base” and its “superstructure,” akin to a foundation and the building that rests on it.²⁹ For Marx, the base pertained to the prevalent economic mode of production in a society.³⁰ The superstructure was comprised of the non-economic aspects of society, including law, politics, media, family, culture, philosophy, and so on.³¹ Marx believed that the law is an integral part of the superstructure and, consequently,

is clearly an instrument of the de facto ruling class: it both defines and defends these rulers’ claims upon resources and labor-power—it says what shall be property and what shall be crime—and it mediates class relations with a set of appropriate rules and sanctions, all of which, ultimately, confirm and consolidate existing class power. Hence the rule of law is only another mask for the rule of a class.³²

Or, more succinctly, Marx asserted that the rule of law “is a bourgeois notion that merely reproduces the inequality of unequal labor.”³³

Interesting parallels exist between what Marx taught and what CLS scholars believe. For example, Professor Mark Tushnet, a prominent CLS scholar, wrote that from a CLS perspective, the rule of law is an “ideological project” that serves as an instrument of oppression by the group that happens to be in power.³⁴ In a related vein, CLS scholars challenge the concept of a value-neutral legal process.³⁵ Instead, they argue that the system is built by elites who have a stake in rationalizing their dominant power positions, so they “define rights in a way as to reinforce existing hierarchies of wealth and privilege.”³⁶ Or, more succinctly, law is politics, and politics is power.

Neo-Brandeisians view the law, and specifically the field of antitrust law, in the same way that Marx and CLS scholars view the rule of law. Specifically, the Neo-Brandeisians reject the belief that antitrust law is above or outside of politics.³⁷ In fact, according to Neo-Brandeisians, markets themselves are political.³⁸ Sandeep Vaheesan of the Open Markets Institute, a former colleague and co-author of Chair Khan, wrote that because “[t]he state constructs and structures markets through legal rules[,] [t]he market is not a force of nature, as the law and economics ideology underpinning antitrust presumes.”³⁹ Instead, he writes, the idea of markets “as a ‘spontaneous order’ is a useful construct for defenders of the status quo because it lends legitimacy to the current order.”⁴⁰

Chair Khan agrees that markets are political.⁴¹ During an interview with Stuart Varney, she went even further, stating that “all decisions are political insofar as government agencies are bringing them.”⁴² Individuals who have served at the FTC or Department of Justice (“DOJ”) may reject this characterization, observing that the agencies and courts make decisions based on sound economics and legal precedent. But Matt Stoller of the American Economic Liberties Project, another former colleague and staunch ally of Chair Khan, argues that “[t]he point of economics as a discipline is to create a language and methodology for governing that hides political assumptions from the public.”⁴³ A recent piece in the Yale Law Journal conveyed a similar perspective:

“Neoliberal” premises undergird many fields of law and have helped authorize policies and practices that reaffirm the inequities of the current era. In particular, market efficiency, neutrality, and formal equality have rendered key kinds of power invisible . . . . [resulting in] a pervasive view of law that encases “the market” from claims of justice and conceals it from analyses of power.⁴⁴

In other words, the Neo-Brandeisians reject the characterization of antitrust law as value neutral and relatively free from political interference. Vaheesan declared starkly that “antitrust law is and will be political.”⁴⁵ And it follows naturally that if antitrust is not value neutral, neither is the consumer welfare standard.

In sum, the Neo-Brandeisians, drawing on refrains from Marx and CLS scholars, believe that antitrust enforcement is a politicized exercise that for decades has served as a tool of oppression to reinforce existing inequities.⁴⁶ This perspective appears to explain several aspects of the Neo-Brandeisian worldview.

If antitrust is indeed a tool of oppression, it makes sense that the Neo-Brandeisians paint those who helped shape the status quo, or who now defend it, as not just wrong, but evil and corrupt.⁴⁷ It does not matter if one is a Democrat or Republican—the Neo-Brandeisians view enforcers of both parties from the last forty years as corrupt.⁴⁸ One basis for frequent allegations of corruption pertains to the revolving door. A report co-authored by Rohit Chopra was released on the day he was sworn in as an FTC Commissioner. The report took a far-reaching view of conflicts of interest.⁴⁹ Specifically, he asserted that even in the absence of direct financial interests, the possibility of future employment in the private sector could influence the enforcement decisions of government employees.⁵⁰ In his new capacity as Consumer Financial Protection Bureau Director, former FTC Commissioner Chopra reiterated this view, explaining that “financial regulators [are] clueless and often corrupt lawyers and economists” who are merely auditioning for future jobs in the private sector.⁵¹ Chair Khan expressed a similar view, writing that “the Department of Justice enforcer who aspires eventually to join J.P. Morgan may hesitate to antagonize a potential employer.”⁵²

The disdain of the Neo-Brandeisians is not limited to individual practitioners. The Antitrust Section of the American Bar Association is similarly viewed as part of the establishment, the so-called ruling class, that helps shape antitrust law and policy.⁵³ It, too, is therefore complicit in the oppression of the underdog.⁵⁴ This view might explain why Chair Khan kept the ABA Antitrust Section at arm’s length.⁵⁵

This perspective also condemns the FTC and its staff as complicit in the oppression.⁵⁶ That might explain why former Commissioner Chopra expressed such a dim view of not just the FTC, but of FTC staff.⁵⁷ He asserted that they were “captured” by the industries they oversaw.⁵⁸ Indeed, while a sitting commissioner, Chopra suggested that the FTC’s Inspector General review the work of staff with respect to pharmaceutical mergers.⁵⁹ And he told Congress that it should view with suspicion agency personnel’s attendance at conferences and participation in panels.⁶⁰

Could this view have been the driving force behind the decision to muzzle staff? Chair Khan prohibited staff from attending and speaking at conferences, despite the fact that this participation promotes transparency and certainty regarding government enforcement intentions and facilitates legal compliance.⁶¹ Perhaps this also explains why Chair Khan, particularly during the early months of her tenure, was reluctant to seek the input of staff on policy issues⁶²—a posture that would make sense if staff were viewed as part of the corrupt establishment. Staff have been marginalized under Chair Khan’s leadership in numerous ways,⁶³ causing many experienced and respected professionals to leave the agency.⁶⁴

Neo-Brandeisians have undermined transparency and predictability in other ways, as well. These actions erode certainty regarding the rules of the road, a central function of the rule of law. For example, the Neo-Brandeisians at the FTC rescinded the section 5 policy statement and foreshadowed a more expansive enforcement agenda while failing to issue a new policy explaining this agenda.⁶⁵ They withdrew support for the Vertical Merger Guidelines and characterized them as insufficiently aggressive while declining to provide guidance on where to draw the new lines.⁶⁶ And they have failed to challenge mergers within the requisite statutory timeframes, instead issuing threatening warning letters as waiting periods expire.⁶⁷

Ironically, then-Professor Wu criticized “the incredibly secretive and technical nature” of the merger review process in The Curse of Bigness.⁶⁸ Merger guidelines explain the antitrust agencies’ analytical approach to reviewing mergers and shed light on the process.⁶⁹ Similarly, policy statements provide guidance regarding enforcement intent with respect to other business activities.⁷⁰ Withdrawing existing guidance and leaving a vacuum does nothing to dispel the allegedly “secretive” nature of the investigative process. Instead, these actions create the opportunity for the arbitrary exercise of government power—precisely the harm our Founding Fathers sought to avoid.⁷¹

Of course, if aggressive antitrust enforcement that reins in big companies is good, antitrust enforcers certainly have been a force for good in recent decades.⁷² In fact, antitrust enforcement in 2020 (under President Donald J. Trump and Chairman Joseph J. Simons) hit its highest numbers in decades.⁷³ But CLS scholars would dismiss these successes as a smokescreen.⁷⁴ They argue that to maintain stability and keep the oppressed from revolting, the “law must be perceived to be approximately just, so the ruling class cannot win all the time.”⁷⁵ Similarly, the Neo-Brandeisians ignore the fact that the FTC has delivered significant benefits to American consumers in recent decades.⁷⁶ Instead, they characterize the last forty years as a “failed experiment.”⁷⁷

B. Due Process

Classical liberalism is premised on the rights of the individual, liberty, consent of the governed, and equality before the law.⁷⁸ To protect these rights, liberalism is grounded in process.⁷⁹ Professor John Hart Ely wrote in Democracy and Distrustthat “[w]hat has distinguished [the American Constitution], and indeed the United States itself, has been a process of government, not a governing ideology.”⁸⁰ CLS, on the other hand, views due process as preventing benevolent change.⁸¹ Procedural rules serve as speed bumps on the road to justice. Because “procedural rules reflect political choices,” they can be tossed aside to achieve desired substantive change.⁸²

In their desire to remake antitrust law, the Neo-Brandeisians have embraced a similar disregard for process and norms. They know what the utopian antitrust regime looks like, and they are willing to toss aside procedural niceties to get there.⁸³ For example, new FTC leadership undertook abrupt and sweeping policy changes with little to no input from knowledgeable staff or the public and with essentially no notice to minority commissioners.⁸⁴

There are many facets of liberalism and due process that the Neo-Brandeisians scorn through both actions and words. The following quote conveys succinctly key tenets of classical liberalism:

Liberalism . . . distrusts grand unifying theories and prefers to emphasize process over ends. . . . Because of the value liberals place on liberty, they tend to be wary of the sort of power concentrations that could mandate changes quickly. They prefer a more incremental approach to political change that depends on the consent of the governed . . . . Liberalism is never utopian, by anyone’s definition, but always procedural, because it presupposes a society of people who profoundly disagree with each other and whose interests, goals, stakes and stands, cannot easily, if ever, be fully reconciled.⁸⁵

This description provides a useful benchmark for evaluating the actions of the FTC’s current leadership.

“Because of the value liberals place on liberty, they tend to be wary of the sort of power concentrations that could mandate changes quickly.”⁸⁶ But Chair Khan has consolidated power in the Office of the Chair since arriving at the Commission.⁸⁷ Changes to the FTC’s Rules of Practice regarding the rulemaking process place far more power in the Chair’s office, facilitating an agenda-driven outcome.⁸⁸ Omnibus resolutions ensure that the Chair needs no other commissioner’s vote to authorize staff to use compulsory process in essentially all agency investigations.⁸⁹ Through these and other actions,⁹⁰ Chair Khan has undermined the congressionally mandated Commission structure.

“They prefer a more incremental approach to political change that depends on the consent of the governed . . . .”⁹¹ But Chair Khan has undertaken sweeping policy changes without typical opportunities for public input. The Commission under Chair Khan abruptly voted 3–2 to rescind the Statement of Enforcement Principles Regarding “Unfair Methods of Competition” Under Section 5 of the FTC Act.⁹² Similarly, the majority voted to rescind the 1995 Policy Statement Concerning Prior Approval and Prior Notice Provisions in Merger Cases without notice and comment, even though it was subject to notice and comment (i.e., the Commission made a draft of the policy public and solicited comments before enacting the policy) when it was issued.⁹³ The same is true for the rescission of the Vertical Merger Guidelines.⁹⁴ And the Commission accepted public input only after votes on several policy issues occurred during the first several open Commission meetings.⁹⁵ How can the governed consent if their input is not sought?

“Liberalism is never utopian, by anyone’s definition, but always procedural, because it presupposes a society of people who profoundly disagree with each other and whose interests, goals, stakes and stands, cannot easily, if ever, be fully reconciled.”⁹⁶ Under Chairman Simons, Acting Chair Slaughter, and countless other FTC Chairs, the Commission certainly experienced policy disagreements.⁹⁷ But the careful observance of traditions and norms enabled commissioners to discuss their views with each other and with expert staff. This process occasionally changed commissioners’ minds about how to vote on various matters.

A thorough process creates benefits that extend beyond the final vote; it also generates results that are more likely to withstand the test of time.⁹⁸ In contrast, a dearth of process leads to poor results.⁹⁹ For example, the majority’s statement on rescission of the Vertical Merger Guidelines contained flawed assertions about fundamental economic principles, according to leading commentators.¹⁰⁰ Perhaps if the majority observed the time-honored tradition of circulating draft statements in advance of votes, the minority’s draft dissent would have noted those errors, and the majority would have fixed them. Or, as those leading commentators noted, even seeking the input of learned staff could have prevented the issuance of a statement with flawed assertions.¹⁰¹

II. Parallel Views on Economic and Political Issues

The parallels among Neo-Brandeisian, Marxist, and CLS views do not stop at core classical liberal principles. The similarities are noticeable with respect to a variety of economic and political issues, including the concepts of capitalism, mergers and business growth, individualism, and central planning.

A. Capitalism

Capitalism is a system in which assets are privately owned, labor is purchased for wages, gains accrue to private owners, and prices allocate capital and labor among potential uses.¹⁰² While the United States is a capitalist country, it is worth noting that a fair amount of government intervention in the marketplace occurs. The 2022 Index of Economic Freedom ranks the United States twenty-fifth out of 177 ranked countries.¹⁰³ The study also finds that the standard of living is much higher in economically freer countries.¹⁰⁴

Marx viewed capitalism in an entirely different light. He taught that the capitalists, who own the means of production, oppress the masses, who ultimately will rise up and overthrow their oppressors.¹⁰⁵ Two related concepts play a fundamental role in this conclusion. The first concept is the labor theory of value, which teaches that the value of any commodity is measured in terms of the amount of labor embodied in it—the labor time required to produce it.¹⁰⁶ The second concept is that of surplus value, which is the difference between the price of a product and the cost to produce it.¹⁰⁷ Marx asserted that owners of the means of production, the capitalists, unfairly appropriate this surplus value from workers.¹⁰⁸

Lazar Radic described how these concepts become interwoven with the concepts of capitalism and competition in the Marxist worldview.¹⁰⁹ In a market economy, capitalists seek to gain an advantage over their rivals by driving down costs, increasing productivity, and decreasing the price of goods and services.¹¹⁰ They reinvest the surplus value (wrongfully) appropriated from labor to facilitate increases in productivity and acquisitions that increase scale.¹¹¹ In other words, competition is the engine of capitalism. And the capitalist that can lower costs, appropriate the most surplus value, and reinvest the most is both the most exploitative and the best-positioned vis-à-vis its rivals.¹¹² The bottom line, according to Marx, is that capitalists steal from workers to obtain scale, lower costs, cheapen commodities, and beat their rivals in the market.¹¹³

CLS scholars take a similarly dim view of capitalism, competition, and efficiencies. One author observed that a “free market reaches ‘efficient’ results only with respect to any given set of entitlements” bestowed by the existing legal regime.¹¹⁴ Because that existing legal regime serves to reinforce inequities, “the notion of efficiency, while analytically useful, still speaks to the underlying question of legitimacy only at the margins, so to speak, not at the core.”¹¹⁵ For CLS scholars, capitalism and lawmaking are “governed by the same process of alienation.”¹¹⁶ In other words, for CLS scholars, “[p]roducing goods and services in the workplace and making law in legislatures and courtrooms are both forms of objectification.”¹¹⁷ This connection between capitalism and lawmaking is true in capitalist society, according to CLS theory, because laws are not actually made by their purported authors—the people.¹¹⁸ Instead, laws are made “by experts socialized in elite institutions and distant from the lived reality of everyday life in capitalist society.”¹¹⁹

A look at the beliefs of the Neo-Brandeisians reveals many parallels. Capitalism focuses on satisfying consumer demand, and the consumer welfare standard seeks to maximize benefits for consumers. But the Neo-Brandeisians, like Marx, have sought to shift the focus from consumers to workers.¹²⁰ In describing the goals of antitrust, Chair Khan frequently references workers and honest businesses.¹²¹ Vaheesan stated that “[a]n antitrust enforcer anchored in consumer welfare is an antitrust enforcer anchored in anti-labor.”¹²² He and co-author Chair Khan embraced the concept that antitrust law is a “once-populist and progressive ‘law against exploitation [that] has become the law for exploiters’ as ‘[e]fficiency and power win.’”¹²³ He recently proclaimed that the FTC “should treat low prices derived from exploitation of workers as an unfair method of competition.”¹²⁴

Tim Wu, now Special Assistant to the President for Technology and Competition Policy, wrote an op-ed in the New York Times in July 2020 that similarly bemoaned economies of scale and low prices.¹²⁵ Wu demonized large flour producers for maximizing scale and driving down the price of flour through “brute efficiency.”¹²⁶ He complained that this approach “limit[ed] workers’ salaries and reduc[ed] the prospects for smaller or local competitors.”¹²⁷ And he praised the higher-priced offerings of smaller flour companies that employ more people relative to their size.¹²⁸ This comment reveals not just a focus on workers, but also on rivals. It is common for the Neo-Brandeisians to focus on the impact of mergers and conduct on smaller rivals.¹²⁹ But this approach contravenes the established view that the antitrust laws protect competition, not competitors.¹³⁰

B. Mergers and Business Growth

Free markets reward with growth those companies that offer superior products and services at lower prices. And the market for corporate control ensures that, through mergers and acquisitions, assets flow to companies that will use them most productively. While Marxism accepts at face value a correlation between the size of a company and its level of productivity, it goes a step further in asserting a correlation between the size of a company and the magnitude of its worker exploitation.¹³¹ The Neo-Brandeisians also believe that big is bad, even in the absence of market power.¹³² Wu emphasized this point in The Curse of Bigness.¹³³ And in an article with Professor Teachout, Chair Khan detailed the harms that large corporations inflict on society.¹³⁴

Some nuances between the views of Marxists and the Neo-Brandeisians are worth mentioning. While both schools view mergers and business growth as inherently harmful and inevitably corrupting, they differ on efficiencies. Specifically, Marxists believe that the drive for greater productivity fuels mergers and corporate growth,¹³⁵ while Neo-Brandeisians are skeptical that efficiencies actually materialize.¹³⁶ And when growth does generate efficiencies, the Neo-Brandeisians are inclined to view them as harmful because they disadvantage smaller rivals.¹³⁷ But the overarching parallels between the views are clear: corporate growth generates insidious harms to society.

The Neo-Brandeisians argue that antitrust policy must account for these harms, which they characterize as an assault on democracy.¹³⁸ For example, Chair Khan proposes using antitrust law to give a broader group of citizens access to managerial positions in the private sector.¹³⁹ She and co-author Teachout wrote that everyone else experiences a “daily relationship to power . . . only as subjects,” creating a dearth of informed citizens capable of challenging political power.¹⁴⁰ Of course, this perspective views people as one-dimensional “workers” and ignores the managerial skills that one can develop through coaching student athletes, building volunteer organizations, serving on the boards of non-profits, and even through employment with local, state, and federal government entities. This shriveled perspective of the human existence prompts Neo-Brandeisians to shift the policy goals of antitrust enforcement, a shift they mask with the commonly heard language of “protecting the competitive process.”¹⁴¹

So, large corporations are viewed with suspicion, and mergers that increase corporate size are viewed as detrimental (one former colleague of Chair Khan’s wrote an article titled Mergers Ruin Everything).¹⁴² In addition to objections about corporate growth in a vacuum, it appears that the Neo-Brandeisians view the goals of the competitive process—increased productivity, lower costs, and lower prices—not as benefits but as harms because they flow from the exploitation of workers and disadvantage rivals.¹⁴³ This approach may explain why merger efficiencies are viewed as a negative by the Neo-Brandeisians,¹⁴⁴ and why they pushed for a moratorium on mergers in 2020.¹⁴⁵

The view of the Neo-Brandeisians that mergers are evil may explain the many process and policy shifts undertaken by the FTC since President Biden’s inauguration. In February 2021, the FTC and DOJ announced a “temporary” and “brief” suspension of grants of early termination of the Hart-Scott-Rodino (“HSR”) waiting period.¹⁴⁶ Over a year later, the public has received no clarity regarding when the agencies plan to lift this unwarranted and unprecedented suspension.¹⁴⁷ In May 2021, the Commission flouted a negotiated timing agreement after the parties voluntarily extended the timing several times,¹⁴⁸ failed to order a divestiture in a transaction that all Commissioners had reason to believe violated the antitrust laws, and consequently left consumers unprotected.¹⁴⁹ In July 2021, the Commission rescinded a 1995 Policy Statement Concerning Prior Approval and Prior Notice Provisions, facilitating a massive end-run around HSR filing requirements and opening the door for vindictive and wasteful enforcement.¹⁵⁰ In subsequent months, practitioners began to report avenues of merger investigation that add time and expense to the merger review process but would not support legal challenges in court.¹⁵¹ Collectively, these actions raise the costs of doing mergers and threaten to chill harmful and beneficial deals alike.¹⁵²

Marxist theory believes that the competitive process inevitably leads to the emergence of “an ever-decreasing number of ever more powerful capitalist overlords” “[o]ver the corpses and semi-corpses of small and middling capitalists.”¹⁵³ Given the drive to achieve greater scale and productivity, Marxists believe that “out of ‘honest,’ ‘democratic,’ ‘progressive’ competition grows irrevocably ‘harmful,’ ‘parasitic,’ ‘reactionary’ monopoly.”¹⁵⁴ Perhaps this worldview explains why the Neo-Brandeisians continue to advance the now-debunked narrative that concentration is increasing throughout our economy,¹⁵⁵ their insistence on finding a monopolist under every bed,¹⁵⁶ and their insistence on blaming every sub-optimal occurrence on monopolies.¹⁵⁷

C. The Individual Versus the Collective

John Stuart Mill asserted that “[t]he only freedom which deserves the name, is that of pursuing our own good in our own way.”¹⁵⁸ The free market is driven by the preferences of countless individuals. But in The Social Contract, Jean-Jacques Rousseau wrote that “[m]an is born free; and everywhere he is in chains.”¹⁵⁹ He argued these chains include familiar institutions of society like family, religion, and class, as well as rules, customs, and traditions.¹⁶⁰

George Wilhelm Friedrich Hegel and Marx viewed the state as destroying these social ties, becoming the liberator, and releasing the individual from loyalty to anything but the state itself. ¹⁶¹ By emphasizing loyalty to the state, socialism elevates the collective above the individual.¹⁶² On a related note, Marxists view as detrimental the “creation and maintenance of individuals as economic and legal subjects, the bearers of reified property rights.”¹⁶³ Why? Because a “‘right’ in bourgeois legal form . . . fragments class solidarity” and dampens the desire to collectively struggle against oppression.¹⁶⁴ The individual as the bearer of property rights is anathema to Marx.

Like Marx, CLS scholars also reject a focus on individualism and property rights. Leading CLS scholar Roberto Unger said traditional property rights protect social hierarchy at the expense of communal life.¹⁶⁵ This approach views property rights as negative and toxic.¹⁶⁶ Another CLS scholar wrote that “‘[p]roperty rights,’ in American culture, have functioned as powerful symbols of individual freedom . . . of security . . . [and] of productive efficiency, providing the incentives to labor, invest, and create.”¹⁶⁷ But this dominant ideology of property, he noted, downplays or obscures property’s other faces, which are “coercive and oppressive.”¹⁶⁸

Neo-Brandeisian beliefs parallel Marxist and CLS positions in rejecting individualism. The consumer welfare standard benefits individuals through low prices, greater choice, higher quality, and more innovation,¹⁶⁹ but like Marxists, the Neo-Brandeisians would subjugate the rights of the individual to the rights of favored groups. Chair Khan has already asserted that all decisions are political,¹⁷⁰ so we know the groups selected for preferential treatment will depend on which way the political winds are blowing. In fact, a new bill from Senator Elizabeth Warren previews some of those favored groups, including “workers . . . sellers, small or minority-owned businesses (including farms and ranches), local, rural, or low-income communities, [and] communities of color.”¹⁷¹

D. The Invisible Hand Versus Central Planning

In order for free markets to function, private property rights must be respected and protected. But Marx envisioned “the abolition of bourgeois property” and state-controlled mechanisms of production.¹⁷² History has demonstrated repeatedly that command and control economies lead to the drastic misallocation of resources, creating misery and deprivation for ordinary citizens.¹⁷³ For the same reasons that central planning failed in the Soviet Union, Cuba, China, North Korea, Venezuela, and elsewhere,¹⁷⁴ the regulatory regimes that governed transportation industries in the United States generated lower levels of innovation and supply, and higher prices, than those same industries experienced following deregulation.¹⁷⁵ The Neo-Brandeisians ignore this history and propose to expand significantly the government’s role in the U.S. economy.¹⁷⁶ But history demonstrates that heavy-handed regulation harms innovation.¹⁷⁷

CLS scholars also favor an approach that diminishes innovation. One CLS scholar wrote that “[s]tressing property as the necessary incentive to productivity suppresses the need for resources to be widely available to others” who would make productive use of them.¹⁷⁸ This author provided an example pertaining to intellectual property: “[I]nsisting on making all the fruits of creative labor into ‘intellectual property’ disregards how making knowledge into property limits the ability of other creative people to make use of a common stock of ideas for innovations of their own.”¹⁷⁹

Perhaps this perspective explains the heavy thumb on the scale for implementers, rather than innovators, of intellectual property that the Biden Administration has exhibited thus far.¹⁸⁰ The arena of standard-setting organizations provides key examples.¹⁸¹ Standardization is critical for the development of new technologies around the world.¹⁸² The use of standard essential patents (“SEPs”) and fair, reasonable, and non-discriminatory (“FRAND”) licensing terms create the framework for investment in and implementation of new technologies.¹⁸³ To incentivize innovation and competition, policy must strike a healthy balance between the interests of those that generate innovations embodied in standards and those that implement those standards.

On December 19, 2019, the Trump Administration implemented the Policy Statement on Licensing Negotiations and Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments (“2019 Policy Statement”).¹⁸⁴ The Biden Administration released the December 6, 2021 Draft Policy Statement on Licensing Negotiations and Remedies for Standards-Essential Patents Subject to Voluntary F/Rand Commitments (“2021 Draft Policy”) ostensibly to replace the 2019 Policy Statement. The 2021 Draft Policy threatened to favor implementers to the detriment of innovators.¹⁸⁵ For example, the 2021 Draft Policy claims “monetary remedies will usually be adequate to fully compensate a SEP holder for infringement.”¹⁸⁶ But if innovators cannot enjoin implementers from violating patents, the incentive for holdout—the refusal of implementers to negotiate in good faith and instead persist in infringing on SEPs—increases. When government policy encourages holdout, innovators will not receive fair compensation for their innovations, and incentives to innovate will decline.

After reviewing the comments submitted in response to the 2021 Draft Policy, the agencies responsible for the policy chose to rescind the 2019 Policy Statement.¹⁸⁷ The agencies, however, chose not to issue the 2021 Draft Policy, leaving no guidance for SEP negotiations.¹⁸⁸

The 2021 Draft Policy also sought to dictate the minutiae of SEP licensing negotiations, highlighting the progressives’ preference for government control over free market negotiations.¹⁸⁹ Notably, the parties to these negotiations frequently are highly sophisticated companies that do not need the protection of the government. But in a socialist society, the state controls the means of production, and planning substitutes for competition as the economy’s steering mechanism.¹⁹⁰

Again, the parallels with the Neo-Brandeisian approach are striking. Although private property may remain a reality, they seek to replace the invisible hand with heavy-handed regulation.¹⁹¹ They characterize as successes the unwieldy regulatory frameworks that once governed railroads and airlines.¹⁹² Indeed, Chair Khan touted railroad regulations as a model for regulating large tech companies.¹⁹³ And they advocated for the extensive use of rules to govern competition generally—no more case-by-case ex post enforcement, but instead an ex ante ordering of the market.¹⁹⁴ The list of rules they intend to create is breathtaking.¹⁹⁵ Ultimately, the Neo-Brandeisians prefer that the government, rather than the private sector, orchestrate the functioning of the economy.

All of these concepts help illustrate why the Neo-Brandeisians loathe the consumer welfare standard.¹⁹⁶ While increased productivity and lower prices benefit consumers, those same features signify worker exploitation under the labor theory of value.¹⁹⁷ Efficiencies, productivity, declining costs, and lower prices all point to the cheapening of commodities that Marx discussed¹⁹⁸—which is equivalent to the cheapening of flour that dismayed Tim Wu.¹⁹⁹ Neo-Brandeisians believe that consumers must sacrifice lower prices for the greater good, in whatever way the politicized process happens to define the greater good at the moment.

III. Destruction and Revolution

Marx drew on the concepts of Jean-Jacques Rousseau, who argued that society and law “bound new fetters on the poor, and gave new powers to the rich,” “eternally fixed the law of property and inequality,” “and, for the advantage of a few ambitious individuals, subjected all mankind to perpetual labour, slavery and wretchedness.”²⁰⁰ Rousseau lamented the existence of exchange relationships, rivalry, and competition that “inspired all men with a vile propensity to injure one another” and a “secret desire [to] profit[] at the expense of others.”²⁰¹ Like Marx after him, Rousseau envisioned the dissolution of the civilized state responsible for the moral degeneration and widespread alienation of people.²⁰² Destroying the existing society would enable construction of a new, ideal society.²⁰³ Rousseau, an important muse for the Jacobins in the French Revolution,²⁰⁴ said that “in the life of a state there are ‘periods of violence . . . when revolutions do to peoples what certain crises do to individuals . . . and when the State aflame with civil wars is so to speak reborn from its ashes and recovers the vigor of youth.’”²⁰⁵

Marx also drew on the concepts of Hegel, who believed that individuals, societies, and states pass through a series of stages during the course of history, each one better than the next, in an endless progression towards perfection.²⁰⁶ For Hegel, war was indispensable in achieving political progress.²⁰⁷ Out of the crisis of war, or tumult, a better version of the State was certain to emerge victorious.²⁰⁸ Marx also believed in the inevitable progression towards perfection, arguing that the inevitable result of capitalism was socialism and then the utopia of communism.²⁰⁹ Critics of Marxism noted that “[b]ecause revolutionaries are confident that the next stage of history will automatically represent progress, that any change will be for the better, they readily tear down and destroy the existing order—which historically has meant killing off anyone who resists, from rulers to peasants.”²¹⁰

Perhaps the perspectives of Rousseau, Hegel, and Marx explain why the Neo-Brandeisians do not shy away from actions that are destructive to the FTC. If one believes that tumult and destruction inevitably lead to progress, one can dismiss near-term harms as the price of progress. And make no mistake—the Neo-Brandeisians already have imposed significant harm on the Commission and threaten even greater harm in the future.

As noted previously, then-Commissioner Chopra routinely attacked the FTC for being lax and feckless.²¹¹ His characterizations assisted in undermining the bipartisan congressional support that the FTC long enjoyed.²¹² And Chair Khan said that agency overreach does not appear in her top ten list of concerns.²¹³ But when the FTC engaged in overreach in the past, it incurred the wrath of Congress and its appropriators.²¹⁴

Moreover, current leadership has diminished and marginalized staff in astonishing ways, leading to a significant brain drain.²¹⁵ Countless experienced members of the FTC community, boasting both an encyclopedic knowledge of their fields and finely honed management skills, have fled.²¹⁶ This trend is both tragic and ironic: many of these employees agree with Chair Khan’s desire to engage in more aggressive enforcement, and without these skilled and dedicated employees, Chair Khan will face greater difficulty in implementing her agenda.

Conclusion

This Article describes parallels among the worldviews of Marxism, CLS scholars, and Neo-Brandeisians. Many observers remain complacent in the face of attacks from the Neo-Brandeisians on the status quo, convinced that the so-called “antimonopoly movement” is focused only on reining in the largest tech companies, or perhaps the largest companies in the U.S. economy. A closer review of these parallels, though, reveals otherwise. The logical outworking of these worldviews leads inescapably to the conclusion that the Neo-Brandeisians seek control of the most minute aspects of the American economy.

The authors encourage readers to take two steps. First, examine the writings of the Neo-Brandeisians, which describe in detail their plans to transform the field of antitrust law, our economy, and our society. Second, share those writings with others. As Professor Herbert Hovenkamp said, “a neo-Brandeis approach whose goals were honestly communicated could never win in an electoral market, just as it has never won in traditional markets.”²¹⁷ The remarks of Barry Lynn and Professor Teachout at the 2022 ABA Antitrust Section Spring Meeting served as a wake-up call for many in the antitrust community regarding the unvarnished beliefs and intentions of the Neo-Brandeisians.²¹⁸ Other stakeholders and policymakers need a similar wake-up call, a task we ask our readers to facilitate.

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Deconstructing the Worldview of the Neo-Brandeisians Through Marxism and Critical Legal Studies

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