Open Markets Institute Files Comment to FTC & DOJ on Merger Enforcement

The Open Markets Institute (OMI) filed a response to the request by the Federal Trade Commission and the Antitrust Division of the Department of Justice for information on merger enforcement.

The key points raised in Open Markets' comment are:

• The merger guidelines used by regulators since the early 1980s depart from the core principles that have historically governed America's political economy and that were essential to preserving American liberty and prosperity.
• The lax merger guidelines used over the past 40 years have contributed to unprecedented concentrations of economic and political power that threaten both America's economy and its democratic institutions.
• To remedy these ill effects, regulators should reestablish traditional bright-line merger rules based on market share, similar to those detailed by the Justice Department in its 1968 guidelines.

"For more than 50 years, the merger guidelines have served as the main statement of how the government understands the political purposes of the antimonopoly laws Congress has enacted since the founding," said Barry Lynn, executive director of the Open Markets Institute. "The 1968 guidelines told people that the government was going to enforce antimonopoly as intended by carefully structuring markets and corporations to achieve certain political, social, and economic outcomes. By contrast, the 1982 guidelines published by the Reagan administration, told people that the government intended to try a radically new approach to the law, by focusing foremost on promoting efficiency, as measured by reductions in price.

Lynn continued, "The effect of the change in the 1982 guidelines was to unleash concentration of power and control in almost every sector of our economy, and to destabilize many of the most important industrial and communications systems. If we want to begin to unwind this consolidation, and return antimonopoly law enforcement to its intended purpose, the FTC and DOJ must establish the traditional bright-line merger rules."

The Open Markets Institute has been the vanguard in advocating for the return of antimonopoly laws to their intended purpose:

• The first to call out the Reagan/Bork philosophy as a source of many if not most of the economic and political ills we face today in America.
• The first to force Congress and the government to debate the problem, as Barry Lynn did at the Federalist Society in November 2017, in testimony to the Senate in December 2017, and in testimony to the FTC in November 2018.
• The first to advocate positively for a return to "bright line" rules to govern market structure and corporate behavior, in this article in ProMarket in 2019.
• Helped lay the intellectual groundwork for the Biden White House to advocate for fundamental change, most directly in this article from December 2020.

This current debate is essential to the economic health and future of inequality in America. Last summer, President Joe Biden condemned the Reagan approach to antitrust and called out Robert Bork by name in his speech announcing his Executive Order on Competition.

Europeans are also currently debating whether to abandon the Consumer Welfare philosophy. A re-embrace of America's traditional understanding of antimonopoly law makes it clear that the present structures and business models of corporations such as Google, Facebook, and Amazon violate the laws and constitutional balances of the United States. Our comments on the guidelines clarify what steps the DOJ and FTC should take to restore this rule of law.

These comments follow Lynn's recent speech calling out members of the antitrust bar themselves at the ABA conference.