Antitrust enforcement has been dormant for decades now. The process started in the eighties, when Robert Bork from the Chicago school of Economics managed to convince Reagan that monopolies are efficient. The Chicago school was also very aware of the possibility of regulatory capture, where monopilists use their dominant position, power and cash to secure laws that support their interests. The problem is that the Chicago school drew the wrong conclusion: if regulatory capture is a risk, they argued, then the best solution is to remove governments from the picture.
This led to less and less antitrust enforcement, and the government increasingly asked to look the other way. This process has continued without interruption under every president, Republican and Democrat, since.
“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. We’re now 40 years into the experiment of letting giant corporations accumulate more and more power. I believe the experiment failed. We have to get back to an economy that grows from the bottom up and the middle out.” Joe Biden
Today, corporates and their minions still feel total impunity over antitrust issues. Take antitrust lawyers, who are openly advising their clients on how to break the law, right in their marketing material (the document has been removed since, but Matt Stoller managed to capture some of the revealing pieces before it was taken down).
Or take Axios, a news and communications firm. In their latest newsletters, they advise their clients to pick fights and “punch back at regulators, policymakers and critics”. Ironically, if a company feels entitled to ‘punch back at regulators’, I would argue it is a strong sign that they have accumulated too much power and deserves to be investigated.
Axios also highlights companies who fought back. All their examples, tough, are shady cases at best: from Doordash which had to settle a lawsuit over using tips to subsidize rides and wants to criminalize tools that let drivers see how much a job will pay before they commit to it, Coinbase which is being investigated for illegal operations and reached a USD 100 mn settlement for lax anti-criminal checks, or Microsoft-Activision who managed to get out (for now) of its antitrust investigation thanks to a judge whose son works at Microsoft (!) and is not interested in understanding the market structure.
Fortunately, thanks to leaders such as Lina Khan at the FTC, antitrust is being revived, and we’ve seen a series of measures and actions taken that are poised to change corporate attitude. But all FTC antitrust cases ultimately rests on the judges, who are often repeating the doctrine of the Chicago school or are former corporate lawyers who have been drinking monopolists’ Kool-Aid for years.
We now have one of the biggest antitrust case with the Google trial (you can follow a day-by-day recap, there is also an RSS feed). Judge Metha, who is overseeing the case, has sent mixed signals so far. For instance, Google has been repeateadly found guilty of destroying evidence, and was got caught doing it in this antitrust case as well, but Judge Mehta hasn’t yet decided to sanction the firm or its lawyers.
This trial is not just about Google tough. Its outcome, if ruled against Google, will send the message to all corporates, and to their lawyers and communications minions, that the party is finally over.
