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Wright on Trump: Populist talk will have little impact on antitrust enforcement
By Kirk Victor. Originally published on FTC:Watch on June 16, 2017
Joshua Wright, who was an adviser to the Trump administration transition team, told a recent panel the president's talk about populism won't have much impact on antitrust enforcement.
"What will happen at the agencies has very little to do with populism," Wright, a former member of the Federal Trade Commission, said during a panel hosted by the Federalist Society on June 9. "I think what will happen at the agencies has very little to do with what candidate Trump or President Trump has said about Amazon or on Twitter."
During the campaign, Trump said that Amazon has "a huge antitrust problem" because it's "controlling so much" of the market.
But Wright, a Republican, dismissed such talk. It is, he said, "just like" what happened when he served during the Obama administration. He recalled that "then-candidate [Barack] Obama said a number of things about antitrust that I don't think had any influence on what the FTC actually did."
Wright predicted that in the next four years, like the last eight years of the Democratic Obama administration, the Justice Department and FTC will examine cases within the context of existing antitrust doctrine as defined by the courts, and they won't push the envelope.
"The FTC is full of professional staff — there are antitrust lawyers who live there," he said. "There are antitrust economists who live there. They get up. They think about antitrust every day; they manage their cases. They make recommendations to commissioners and they vote on cases in a manner that they view as consistent with law."
As for how mergers are analyzed, don't look for change there either, Wright said. "Merger policy is pretty darn steady," he noted. "Maybe in the GOP administration, people propose more adventurous mergers in the hope that they get them through…but the number of challenges, the number of second requests, the workload on the agencies, [will be] identical."
Noting that he disagreed and dissented "a bunch" as a commissioner, Wright said that such "no" votes were cast "in the shadow of existing law; in the shadow of existing agency guidelines — which leave room for disagreement. But the zone of that disagreement is informed by what current law is. And current law says we have a consumer welfare standard in antitrust."
Geoffrey Manne, executive director of the International Center for Law & Economics, agreed, adding that in a GOP administration the expectation is for "somewhat less enforcement on the merger front and probably on the anticompetitive conduct front."
But that change, he added, is "fairly marginal" because "we have the courts to keep things in check."
When Albert Foer, founder and senior fellow of the American Antitrust Institute, spoke of the need to think about antitrust's role in addressing societal issues such as growing economic inequality, Wright would have none of it.
"Economic inequality has become so palpable that this alone can account for much of the populist sentiment that is felt in politics," Foer said, noting that he was speaking for himself. "People want to know what is the role of antitrust in moving towards so much economic [inequality] and what, if anything, antitrust can do to change the direction of inequality."
"Economic thinking has expanded from Chicago's focus on consumer welfare and efficiency to consider elements of psychology, institutional behavior, anthropology, political science, management sciences of strategy and marketing," Foer continued.
But Wright countered that those factors aren't part of antitrust analysis. "The day when the Federal Trade Commission walks into federal court and says, 'You know what, I know the Supreme Court says it is an economic welfare standard, but let me take a whirl at this thing and just argue this case on non-economic grounds.' They lose. They lose badly. Nobody wants to do that."
"If you are looking for competition problems, there is not a lack of desire in the agencies to find them," Wright noted. "I don't think we need any re-invention."
In looking at areas that will change, Wright pointed to the explosive growth of antitrust agencies around the world. "Fifty years ago there were fewer than a dozen antitrust agencies. There are now more than 130. And even 20 years ago, there were three or four antitrust agencies that mattered, and the rest sort of followed and got in line."
Wright stressed "there are 10 or 12 [agencies] that matter a great deal to whether it makes sense for a company to merge or not. That landscape is an important one."
It puts our antitrust leaders in an especially pivotal position. "More than ever it matters what our US antitrust officials say and do because the spillover effects are much more significant and much more likely," Wright said.
"They [foreign antitrust officials] pay attention. They pay close attention to these things," he said. "It matters a great deal to the behavior of other agencies what the US says and does."
"It is probably true that the US is no longer firmly holding the lead in international antitrust. I view that as a bad thing, not so much because of some view that the US law [should] dominate or anything like that," Wright said. "I am not a big fan of the idea that these international systems have to replicate ours."
But what's important about our system is its economic focus, he said. "Economists have played an important role in the US for much longer than anywhere else in the world," Wright noted. "If we are looking for an evidence-based antitrust regime, the infrastructure to do that, the comparative advantage because of that infrastructure, lies here."
The onus is on US leaders to speak out, "especially on things like the role of intellectual property in antitrust," according to Wright.
They must be willing to travel to other countries and make the case by saying, "'we think we know what the right approach is. Here is the evidence that supports that, and we think you ought to do it,' and to say so publicly," he said.
Pointing to the track records on international antitrust of Makan Delrahim, who awaits a Senate confirmation vote to head the Justice Department's antitrust division, and of FTC acting Chairman Maureen Ohlhausen, Wright is confident that they will provide the "missing" leadership.
"I think there is some reason for optimism," he said.