The Durability of the Biden Administration’s Competition Policy Reforms

Category: Print Issues

The Durability of the Biden Administration’s Competition Policy Reforms

William E. Kovacic

Volume 29

, Issue 4

29 GEO. MASON L. REV. 945 (2022)

I cannot think without emotion about the pleasure of participating in the symposium that in the last quarter-century has established itself as an unsurpassed forum for the discussion of competition policy issues. There are other good programs around the world, but nobody is better. I am also moved when I reflect on how the Law Review, with the symposium, has enhanced the stature of George Mason as a powerful intellectual hub in the larger framework of competition law.

I am going to draw upon much of what I learned as a member of the George Mason faculty; in my collaboration with Josh Wright in writing an antitrust casebook; and in my work with Tim Muris, who was my colleague at George Mason for so many years before he invited me to join the FTC as its general counsel. I am going to address a number of themes that have been indispensable to the development of antitrust law and apply them in the context of current efforts within the Biden administration to expand the reach of competition law and policy.

I will consider how the Biden administration might seek to change the framework for competition law enforcement, in addition to changing the basic content of doctrine and policy. You are familiar with the great upheaval that has taken place in U.S. competition policy, captured on the now famous Kahn, Kanter, and Wu coffee cup.¹ You also are aware of how President Biden last summer gave his own imprimatur to a sweeping realignment by signing his executive order on competition policy, which announced a whole-of-government approach to bolstering competition.²

In my time at George Mason, I studied not just the challenges of designing doctrine, but also the crucial question of policy implementation. I often recall the many conversations I had with Tim Muris, who not only had played a major role in shaping the way we think about competition law and policy, but also had entered government to make theory meet practice.

In his classic text in political science, Graham Allison³ considered how we tend to overlook the problem of implementation. Allison observed that if we are going to do a better job in public policy, we have to think harder about how to cross “the path between [a] preferred solution and [the] actual performance of [] government.”⁴

In another formative public administration text from a slightly later period, Richard Neustadt and Ernest May observed that in formulating prudent approaches to governance of agencies, public officials must make “canny judgments about feasibility . . . of the contemplated courses of action.” Neustadt and May posed three questions that came up repeatedly in my conversations with Tim: “Will it work?” “Will it stick?” “Will it help more than it hurts?”⁵

Before I became an academic, I spent three years with a law firm and worked mainly on projects for the company then known as McDonnell Douglas. I often spoke with engineers who had worked on the U.S. space program. The engineers explained to me that the physics of going to the moon and bringing people back safely was relatively clear; the process involved some very fancy mathematical computations, but the basic concept of how to get to the moon and back was relatively clear.

What was more difficult—exceedingly hard—was the engineering to make it so; how to send humans back and forth safely. When President John F. Kennedy announced in 1961 that the nation should seek to accomplish this task by the end of the decade, the technology needed to do it, for the most part, did not exist. The engineering challenges were formidable indeed.

My focus today is building the institutional conditions needed to carry out basic competition policy reform—to consider the establishment of an enabling environment for sweeping change. In talking about reform possibilities and the obstacles to doing it, I am giving you my views only. From 2014 to 2022, I served as a member of the board of the United Kingdom’s Competition and Markets Authority (“CMA”). I do not speak for the CMA, but I draw upon my own experiences there in discussing policy implementation.

I also have a personal stake in this debate from my own experience. There is a large modern literature that harshly criticizes U.S. competition policy from the early 1980s up to the Biden administration. The milder versions of that critique simply say that policymakers in that era made a lot of mistakes. The harsher assessments refer to the leadership of the Department of Justice Antitrust Division and the Federal Trade Commission as being idiotic and corrupt. That is not the way I like to think about my own time in government, either regarding my motives or my effectiveness. Here, I put that aside, as best I can, to understand better the nature of what the reform advocates are seeking to do, what they face in trying to carry out their program, and what they might do during their time in office that would make the system better by improving its institutional framework.

In so many ways, the themes I am treating appear in the pages of the Law Review’s annual symposium going back to its earliest days. The proceedings have featured an interesting mix, not only of commentators talking about what competition policy should do—the substance—but also how to do it, how to go about situating specific reforms in the difficult policy environment that confronts anyone seeking to make things take root, to last, and to work well.

There is a gathering storm that may impede basic change. A large part of the storm is heading the way of the FTC. One ominous development is the Supreme Court’s decision in AMG Capital,⁶ which rejected the FTC’s argument that section 13(b) of the FTC Act⁷ authorized the agency to seek equitable monetary relief.⁸ This was a nine-zero decision. By my count, the last time the FTC experienced a shut out before the Supreme Court was in 1931.⁹

Another relevant matter is the Axon¹⁰Axon Enter., Inc. v. Fed. Trade Comm’n, 986 F.3d 1173 (9th Cir. 2021), cert. granted in part, 142 S. Ct. 895 (2022). case, which the Supreme Court has chosen to review. Axon, in some sense, involves a narrow procedural issue, but it also can be said to go to the heart of the operation of the administrative adjudication mechanism at the FTC. I do not imagine that the Court took the case to reject the claimants’ position about when a respondent in an FTC administrative case can go to the federal courts to challenge the constitutionality of the agency’s process. I also suspect that the Supreme Court’s decision will not have a lot of good things to say about the FTC and its operations.

Current plans to expand the use of competition rulemaking rely on section 6(g) of the FTC Act¹¹ and depend heavily on a 1973 decision of the U.S. Court of Appeals for the District of Columbia: National Petroleum Refiners.¹² It is possible that the “best if used by” date of the D.C. Circuit’s decision has expired, or that its expiry date has passed, as well. If the FTC commences competition rulemaking proceedings on the basis of National Petroleum Refiners, will the reasoning of the court of appeals from fifty years ago hold up today amid greater judicial skepticism about the regulatory state?

The FTC also may seek to perform more fully the role that Professor Daniel Crane has called norms creation¹³ by using section 5 of the FTC Act.¹⁴ This function and its embodiment in section 5, to a large degree, motivated Congress to create the FTC in 1914, yet the FTC has enjoyed a minimum of success in fulfilling this vision in the subsequent 107 years. Why will new initiatives fare better this time before a judiciary that is likely to be wary about Commission cases premised upon section 5’s famously broad grant of authority?

Until his retirement in 2022, Justice Stephen Breyer had been the Supreme Court’s preeminent expert in administrative law, antitrust, and economic regulation. He also has been the best friend the FTC has on the Court, now leaving. His successor (and a former Breyer clerk), Justice Ketanji Brown Jackson, may prove to be more sympathetic than some of her new colleagues are to government intervention in the economy. Yet, no member of the Court today matches Justice Breyer in his regulatory policy and administrative law expertise and his deep knowledge of and, I think, respect for the FTC. As much as he regards the FTC favorably, Justice Breyer authored the opinion for the unanimous Court in AMG Capital. His favorable perspective, on the whole, for the FTC will be missing as other matters come about.

Congress seems to be moving toward enacting comprehensive privacy reform. Congress appears minded to give the new privacy enforcement to the FTC. Will this step eventually provide a stimulus to spin off the FTC’s competition portfolio to the Department of Justice and transform the FTC into an omnibus consumer protection and privacy authority? To preserve its antitrust mandate, the agency may be pressed to explain why having competition, consumer protection, and privacy under the same roof makes sense.

Another major issue for the FTC that could provoke a basic reassessment of the institutional framework for U.S. policymaking is the agency’s portfolio of remedies. Congress in 1914 gave the agency broad power to adjust doctrine and policy, but only light-touch remedies. The chief vehicle for doctrinal adjustments would be section 5 of the FTC Act, and its application would be informed by the unique research capabilities grounded in section 6 of the FTC Act.¹⁵ Another key question for the agency is whether jurisdictional carve-outs for common carriers, not-for-profits, and for banks, created in the early 20th century, will carry on. The persistence of these anachronistic exclusions prevents the agency from carrying out its mandate in vital economic sectors that do not resemble the state of the world as Congress saw it in 1914.

Is the FTC’s governance structure fit for purpose? For almost nine years I participated in the monthly meetings of the CMA’s board. The rich and productive discussions that took place in these proceedings contrasted sharply with the typically sterile and generally uninformative discussions that take place at the FTC board meetings. The CMA is breathtakingly far ahead of the FTC in using its board as an effective governance mechanism. Can the FTC’s governance framework be made more effective? Comparative study that examines the experience of the CMA and other competition agencies abroad would show the path to valuable improvements.

The future of administrative adjudication at the FTC is another appropriate subject of attention, especially if we focus on Dan Crane’s measure of FTC performance: the execution of its norms creation function.¹⁶ Since it began operations in March 1915, the FTC has had 107 years to fulfill its intended norms creation destiny. One way to consider the quality of the Commission’s experience is to ask what are the FTC’s top ten contributions to competition law that go beyond the interpretation of either the Clayton Act¹⁷ or the Sherman Act?¹⁸ What are the agency’s greatest hits? Can one identify ten instances in which section 5 of the FTC Act has made a distinctive contribution—good or bad? One might even include settlements in the mix instead of looking only at the adjudication of cases that result in favorable assessments by the courts of appeals. To identify even ten section 5 examples is difficult. Perhaps the Commission’s second century will be better, yet one is forced to ask why the agency has achieved so few positive results since 1914.

And last, as mentioned earlier, what is the appropriate combination of functions within the Commission? The FTC was conceived initially to be just a competition agency. In the Commission’s first decades, consumer protection made its way into the agency’s work as a way of ensuring that dishonest advertisements did not divert trade away from honest merchants and impose upon them a competitive disadvantage. Since the late 1960s, beginning with the adoption of measures such as the Fair Credit Reporting Act,¹⁹ the FTC has acquired a privacy portfolio. Is it sensible to bundle these functions together in one agency? I think there is a good conceptual rationale for doing it (especially to treat phenomena in the digital economy), but the FTC is going to have to demonstrate that the integration of these policy domains provides a better outcome than one would achieve if they were separately organized. Otherwise, the FTC simply becomes a conglomerate manager of distinct operations and must argue that it has a superior ability to manage those assets and use them well, even though it does not realize synergies among them in practice.

As noted earlier, where will Congress put the privacy portfolio? Will it go to the FTC? If it does—probably with 200–300 additional work years—the pie chart of the FTC budget will contain a relatively small slice called “antitrust.” In looking at the small antitrust slice, one might consider moving the Commission’s antitrust portfolio to the Department of Justice and making the FTC only a consumer and privacy agency. In thinking about its future mandate, the FTC will be confronted with the question of why it is wise to continue the existing allocation of authority.

Developments abroad may provide a stimulus to rethink the U.S. competition policy institutional framework. In the last 15 years, a variety of jurisdictions that once had two or more national competition authorities have decided to consolidate antitrust responsibilities in a single agency. These include China, France, Spain, United Kingdom; all unified their enforcement framework at the national level into a single agency.²⁰ Today, the United States stands alone in having two antitrust authorities at the national level.

Many foreign agencies have achieved superior intellectual leadership in competition policy. Among other means, they have shaped the debate by conducting research and publishing reports and studies. I would not have said, ten or fifteen years ago, that such a change had taken place. I am convinced that it has now. Others have explored the development of better policy tools. I am a big fan of what the United Kingdom has done with its markets regime. The United States has one, but it doesn’t have the remedial features that the United Kingdom does.

As I mentioned before, other agencies abroad are getting much more mileage in using their governing boards to do what a board ought to do: develop a broad strategic vision, discuss the significance of changes in the economic and political environment, identify priorities, allocate resources, and consider the appropriate future direction for policymaking. The CMA is unmatched globally in developing internal governance structures for doing these things well. The CMA’s experience contrasts unfavorably with what is taking place at either the FTC or at the Department of Justice. Our agencies that used to lead the field are no longer doing so. And how do you regain that position of influence? I think improving governance—certainly at the FTC—is a crucial step in that direction.

What are the reform possibilities? What could current management do in this period of possible change to provide a stronger basis for policymaking? The federal antitrust agencies are developing bold policy proposals. What could they do to put the institutional framework on a better footing than it is now, to ensure that not only their own programs, but the programs of their successors proceed better? Here are a few possibilities.

Deeper cooperation among the relevant policymakers is a place to start. That is suggested by the whole-of-government approach announced in President Biden’s executive order on competition policy. The executive order is a healthy step toward unifying disparate areas of policymaking and building connections that can increase competition. Government agencies could achieve a lot by removing unnecessary barriers to participation in the market, to facilitate entry and growth by smaller and newer firms, and to get unnecessary restrictions out of the way. Other useful measures include better disclosure of what the antitrust agencies are doing and an enhanced evaluation regime.

The leadership of the federal antitrust agencies has shown a keen interest in increasing litigation as a policymaking tool. Jonathan Kanter, the Assistant Attorney General (“AAG”) for Antitrust, has said: “[w]e need new published opinions from [the] courts . . . . we need to be willing to take risks and ask the courts to reconsider the application of old precedents to [new] markets.”²¹ In the 1990s, during his tenure as AAG, Joel Klein also emphasized the importance of using litigation to carry out what he called “a conversation with courts.”²²

Litigation is a crucial policymaking tool, but there is nothing easy about it. Tim Wu now serves as President Biden’s chief advisor on competition policy. In his earlier life as an academic, Professor Wu commented about the initiation of the FTC’s monopolization case against Facebook: “This is [a] straightforward and [] easy case.”²³ An interesting custom I’ve observed in the United Kingdom is that when you have confronted what you think is a doubtful proposition, one common reply is to say, “really?”

Really? Are there any “straightforward and easy” cases dealing with section 2 of the Sherman Act? To overcome the formidable obstacles to success in these cases, will the Department of Justice and the FTC take a truly integrated approach to devise and carry out a litigation strategy that is going to change a doctrinal framework that at the moment does not welcome expansions in the reach of public intervention?

A joint venture—a genuine joint venture—between the two agencies has never been realized. Useful cooperation takes place as needed in specific endeavors, such as drafting merger guidelines. It could be better. For the most part, the two agencies do not regularly sit down together to map out the boundaries of doctrine, to discuss where to make desired extensions, to identify the obstacles to accomplishing extensions, and devise a common strategy to realize their doctrinal aims.

This is a moment when such deeper cooperation could happen. This is suggested in comments that Jonathan Kanter made on the day that he and FTC Chair Lina Khan rolled out the announcement of the public consultation on merger guidelines.²⁴ Kanter’s comments speak generously and positively about the FTC’s leadership and the agency’s contribution to policymaking. AAG Kanter is an alumnus of the FTC (he once worked in the engine room as a case handler), and I think he believes that.

The Kanter comments may reflect an understanding that unless the FTC and the DOJ work more closely together and see their common cause in building a larger strategy, they will not attain their ends. Means for greater integration include building a common research agenda as the basis for bringing cases, developing a program of regular inter-agency secondments, and having common teams to develop cases in shared areas of interests such as Big Tech and mergers.

The two agencies must ask, in a very non-sentimental way, how many major cases they can run successfully at one time. Answering this question would benefit from a historical awareness that studies past experience to determine what worked before and why it worked, to study what failed and consider why.

A key example to study is the FTC from the 1970s, when the agency responded to demands for a bold transformation. An ABA Blue Ribbon report in 1969²⁵ said the FTC ought to leave behind all of the clear-cut cases and focus its competition resources on cases involving big commercial stakes and unsettled areas of the law. In other words, do big cases involving novel applications of the FTC’s powers. In this terrain, the Commission would confront major commercial interests and face the greatest danger of being rebuked in the appellate process. By 1977, the FTC had done lots of that on the competition and consumer side of the house.²⁶ The competition agenda features ambitious cases involving shared dominance, predatory pricing, distribution practices, and ethical codes imposed by professional societies. By 1977, the FTC was running fifteen consumer protection rules under the Magnuson-Moss²⁷ framework.

A sobering part of that experience is to realize that the management tools and staffing needed to do this well were not really created until the late 1970s: too late to set the matters on the right path. Today, as the federal agencies consider adding new ambitious matters to the litigation or rulemaking agenda, do they have a good match between their commitments and capabilities? The DOJ and the FTC have promised to do a lot. If they do not account for earlier experience carefully to make sure there is a good fit between commitments and capabilities, the agencies will have a painful number of failures that will dishearten their professional staff and will undermine their larger reform program.

Many other elements of past antitrust experience deserve a close look. The FTC and DOJ collaborated effectively in devising an FTC research program that fed into DOJ cases in the 1940s and early 1950s. The case management that DOJ brought to the Microsoft case in the 1990s provides valuable insights into how to run major litigation matters.²⁸ The FTC’s monopolization case against Facebook is set to go to trial no sooner than February 2024, and the DOJ monopolization case against Google will go to trial in September 2023. With the likely appeals, these matters will not be completed until the second half of this decade. The DOJ brought its monopolization complaint against Microsoft in May 1998.²⁹ The trial began in October of 1998. What is going on in the recent cases that makes the prolonged timetable necessary? Is there nothing to learn from what the DOJ did with the Microsoft case?

Another lesson is to put smaller cases (e.g., Lorain Journal,³⁰ Otter Tail,³¹ Polygram³²Polygram Holding, Inc. v. Fed. Trade Comm’n, 416 F.3d 29 (D.C. Cir. 2005).) in the litigation portfolio. Viewing smaller cases in isolation, one might shrug and say, “who cares?” The smaller cases helped make big law; they were the vehicles for significant adjustments in doctrine that became building blocks for future cases. The FTC’s Part III masterpiece in Hospital Corp.³³In re Hosp. Corp. of Am., 106 F.T.C. 361 (1985). in the 1980s is another episode that rewards careful study. Commissioner Terry Calvani’s masterful opinion for the FTC gained the consent of Judge Posner and his colleagues on the Seventh Circuit.³⁴ Nobody who writes a Part III opinion for the Commission should not study that decision carefully as a model for how you gain deference; not as a matter of form, but in reality.

The agencies also might examine how the FTC restored effective hospital merger control in the 2000s. As the FTC Chair, Tim Muris led the agency in studying why it was losing hospital merger cases and how it could recover.³⁵ The agency carried out research projects to test the assumptions underpinning earlier adverse decisions. The FTC recovered by carrying out its own whole-of-government approach, which included FTC cooperation with the Department of Health and Human Services to build a data set for challenging hospital mergers. By the second half of the 2000s, the strategy worked and the FTC had restored its credibility to challenge anticompetition hospital consolidations.

The examination of past experience indicates how equity concerns have appeared in earlier antitrust cases. In the FTC’s South Carolina State Board of Dentists³⁶In re S.C. State Bd. of Dentistry, 138 F.T.C. 229 (2004). case, the opinion written by Commissioner Mozelle Thompson begins by describing the likely beneficiaries of the challenge to unnecessary state restrictions on dental care fluoride treatment. The program at issue promised to benefit children in relatively poor public school districts. The program the FTC sought to encourage promised to have a decidedly positive distribution impact. The dentists case shows that the FTC has brought cases that aid the dispossessed. This experience suggests that the traditional framework of analysis can embrace cases that accomplish distribution aims.

Last, as the agencies contemplated how to successfully navigate possible trips to the Supreme Court, past experience again provides a useful guide. The last time the FTC or DOJ appeared before the Supreme Court as a party in a Sherman Act section 2 case was Otter Tail in 1973.³⁷ When was the last FTC victory in the Supreme Court in a section 2 case? That would be never. As the FTC’s monopolization case against Facebook proceeds, the agency has to consider what steps will position it to enjoy the greatest prospects of success. The Supreme Court section 2 jurisprudence since 1973 has been formed entirely in the context of private cases. The Court’s decisions in these cases have expressed concerns about over-deterrence through private rights of action. Is there a way to convince the Court that those concerns are overstated and that the federal government, when it comes into court, stands on a different footing with different names, different motivations?

In many ways, the approach for improvements set out above can be taken by the agencies with existing resources and within the bounds of their existing powers. There are other things that require congressional action. For years, members of Congress have spoken of giving the DOJ and the FTC larger appropriations and to date have done nothing. Will Congress mandate a sweeping makeover of doctrine in the antitrust system? That seems doubtful. Instead, we are more likely to see targeted measures focused on Big Tech only. This means that, in the larger framework of policymaking, the federal antitrust agencies are still going to have to learn what you want to get through the courts, which is why formulating a common strategy is so important.

Even if it makes no changes to legal standards, Congress must confront the resource and capability issue. It is a matter of adding more people and changing the mix of skills. The CMA has built a team of fifty people (the “DaTA unit”) to improve its capacity to do analytics and to deal with high technology issues. The team includes computer scientists, engineers, and specialists in data analytics. The DaTA unit has increased the CMA’s ability to understand what is going on in the tech marketplace and bring the modern tools of analytics to bear on policymaking. In the future, it is likely that every agency will move toward developing its own variant of the DaTA team. Will Congress provide the resources for the DOJ and the FTC to develop a similar capability?

Congress also must address a serious compensation problem. For quite a while, going back to earlier contributions to the Law Review symposium, I have suggested that unless you improve the wages paid to skilled personnel, you will be forever chasing from behind in a losing race. If Congress can give the Consumer Financial Protection Bureau (“CFPB”) a 20–25% boost over the pay scale for the rest of the government, is consumer financial protection so much more important? Is competition law not so important?

If this compensation issue is not addressed, we will always have a severe constraint on the agencies’ capacity to run antitrust cases, especially high stakes matters involving major defendants. At current compensation levels, the revolving door will take large numbers of good people away, because the wage differential is so great. Can Congress devise other ways to make up the difference with generous student loan forgiveness policies? The agencies cannot assemble and maintain the teams you need to run hard matters unless Congress is willing to pay for it. Action on greater resources and a new compensation schedule are telling measures of the sincerity of Congress about all its reform commitments. If Congress is going to say such reforms are just too hard, a markedly more ambitious antitrust program will be unattainable.

I offer a few closing comments on why fundamental reforms will be hard to accomplish. One problem is that the realization of major, durable antitrust reforms takes a lot of time. Are you going to be able to sustain a commitment to do this over the number of years that you will need to do it? And can you overcome the side effects of the “catastrophe narrative” that I will mention in a moment? The big competition policy reforms that began during the Reagan era took a long time to embed in the U.S. system. Presidents Reagan and George H.W. Bush had 12 years to appoint judges, to appoint leadership, to change the culture of the agencies. How many elections will it take for the Biden era reforms to take root and flourish? How many election victories will it take to move policy and the institutions in another direction? My sense is that incumbent leaders of agencies, when they realize how little time they have, tend to focus on the substantive program and not the institutional reforms.

Success requires persistence in a long-term policy race. Individual heads of agencies generally have relatively short tenures. By my count, the average AAG tenure since 1933 has been about 2.7 years, and the average FTC Chair’s tenure since 1950 has been about 3.3 years. The clock is ticking loudly for the Biden antitrust leadership. The time passes so quickly. Will there be a succession of leaders with shared values to carry on the Biden era antitrust transformation? How many elections are you going to win to carry out your program? Those considerations weigh against spending a lot of your time on the kind of institutional changes that I have in mind; even the deeper integration between the FTC and the DOJ.

Then there is the catastrophe narrative. How do you make the case for sweeping change: you make it by saying “everything that’s there is rubbish,” that everything is falling apart. This is an unfortunate part of our political discourse. It preceded the transformation in 1981. It preceded the transformation in 1969 and 1970. And the catastrophe story preceded the transformation that is taking place now. President Biden set out his own version of the catastrophe narrative in his statement accompanying the executive order: “Forty years ago, we chose the wrong path . . . following the misguided philosophy of people like Robert Bork, and pulled back on enforcing laws to promote competition.”³⁸

American Economy and an Exchange with Reporters, 2021 Daily Comp. Pres. Doc. 1 (July 9, 2021). In Biden’s telling, Bork is the bad guy responsible for the antitrust enforcement dereliction and the architect of forty years of a failed policy experiment. Really? Was it all so bad, and did nothing good take place that is worthy of emulation?

President Biden did not mention that the administration of Barack Obama—in which Biden served as vice president—is frequently damned by reform advocates more strongly than Reagan. A variety of publications in which those who demand more robust enforcement bitterly attack the Obama era.³⁹ For example, early in 2021 Matt Stoller of the American Economic Liberties Project, observed: “the worst people in the Obama administration were the antitrust enforcers. Total failures, and completely unashamed.”⁴⁰

The modern catastrophe narrative attributes weak enforcement not only to poor judgment or timidity, but also argues that agency leaders (and professional staff) were bad human beings. Jonathan Tepper and Denise Hearn, part of the loud chorus of authors who have attacked the modern enforcement program, punctuate their critical commentary about the FTC and DOJ with personal slurs.⁴¹ Who would ever want to work for these agencies? Who would ever want to be part of such a dismal history? In short, the narrative asserts that bad agencies populated with bad people generated bad programs.

What happens if agency leaders embrace this narrative? If they regard the era that President Biden depicts as forty years of failure as a wasteland, they are unlikely to learn useful lessons from past experience. Why devote effort to study a period of calamitous disaster? A grim side effect of accepting this story is that it complicates one’s efforts to motivate agency staff and get them to commit themselves to an aggressive program, to work really hard, to basically do private-sector hours for public-sector wages, if they’ve just been told that everything they did for the last forty-plus years was useless. And you’re creating unattainable expectations about how you’ll make it all better. You can make it somewhat better, but you don’t have time to make it all better in your own vision.

The catastrophe narrative obscures many durably valuable things that happened in the wasteland, including litigation accomplishments such as Hospital Corp., H&R Block,⁴² Polygram, Realcomp,⁴³ South Carolina State Board of Dentists, and three consecutive successful trips to the Supreme Court.⁴⁴ The wasteland era also features innovations in how to design rules (e.g., the FTC’s Do-Not-Call initiative), and in how to formulate programs with broad economic payoffs and broad social benefit, such as the DOJ’s programs to prosecute and deter collusion in public procurement. Are these and related matters merely rubbish and not worth a close look?

The catastrophe narrative also blinds its exponents to forms of collaboration that the federal agencies undertook to improve competition policy. The omitted history includes the approach that James Rill (DOJ) and Janet Steiger (FTC) took in the late 1980s and early 1990s to develop the agencies’ technical assistance abroad. They embraced a view that said a nonpartisan orientation was essential in advising other countries. The two agencies listened carefully to their foreign counterparts, provided policy options, and when asked for a normative prescription, provided the best assessment of what would work in the distinctive conditions of the host country.

The catastrophe narrative blinds the exponent to all of this experience. The narrative that inspired the ascent to power gets in the way of exercising power effectively. In carrying out an ambitious program of antitrust litigation or rulemaking, the federal agencies will need all the help they can get. For DOJ and the FTC, the help can come in several forms beyond the initiative and insight of the Biden administration’s appointees. It can come from a dedicated effort by the two agencies to further integrate policymaking; from comparative study that identifies superior methods of governance and agency administration; and from reflection on what has worked well for the agencies in all eras of their operation. These are paths to getting good answers to the Neustadt and May queries: Will it stick? Will it work?

Category: Print Issues

The Durability of the Biden Administration’s Competition Policy Reforms

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