Competition policy is bipartisan and a component of Bidenomics.A wide range of uncertainty persists about the timing, impact, and catalyst of major changes to US competition policy, but incremental data reinforce a reality of nearly constant evolutionary developments. Last week was no different. These disparate events clearly are part of a growing tapestry underscoring the involvement of all three branches of government in reviewing economic consequences of prevailing antitrust laws.
Hours apart, President Biden’s newly created Competition Council formally met for the first time, and U.S. District Court Judge Yvonne Gonzalez Roger’s ruled Apple was in violation of California’s competition laws. This summer alone, the antitrust agencies filed lawsuits against leading tech companies, while influential US Senator Amy Klobuchar battling breast cancer treatment promoted a book focused on updating US antitrust laws. This week, bicameral congressional committees will consider and, in some cases, vote on legislation ranging from state venues of antirust cases, milk pricing, social media disinformation, and the nomination of Grant Harris to become the Commerce Department’s assistant secretary for industry and analysis.
We remain of the view that the executive branch presents a more immediate fertile ground for antitrust changes. FTC Chair Lina Khan forced through revisions of that agency’s guidebook to broaden the terms of competition policy violations. President Biden hired NYU law professor Tim Wu to head the National Economic Council’s work in this space and nominated Jonathan Kanter to assume the lead at the Department of Justice. Varied in experience, the triumvirate is another signal that vital competition policy is part of the president’s economic policy.
Executive Order 14306 created a competition policy staff within National Economic Council (itself created in 1993 by EO 12835). Like the NEC’s beginnings, the competition policy staff is relatively small, relying on specific agency staffs to extend its expertise and heft. Agencies represented at the first competition council meeting will help develop and implement policies in several active sectors including healthcare, real estate, transportation, financial services, agriculture, and technology.
As the agencies continue pressing lawsuits, it’s more likely legislative policy makers at the White House and Congress will become more of a Biden second year priority. Kanter very likely will be confirmed before this year ends. Congress will spend disproportionate time on fiscal matters between now and then, clearing room for plenty more debate on competition policy on the floor next year. Of course, the politics of this legal/economic push is welcomed by both parties as the campaign trail offers wider scope to garner attention and support than committee proceedings.
Our lay person’s reading for some time has included growing likelihood of changes to US competition policy. The technology sector deserves lead attention because of its massive disruptive and wealth-creating effects. But as the president’s executive orders on supply chains (as discussed in our September 2 note) and the numerous sectors mentioned in his competition policy order reflect, the “whole-of-government” effort has broad economic and market cues.
Those facts don’t themselves narrow the widely dispersed tail risk we attach to dispositive action by one or all branches of government. Rather, we are obviously in a period of evolution that began earlier this century, and we believe is unlikely to end soon or without consequence. Big bangs are certainly possible within an evolutionary system, but the meatier implication likely is that competition policy represents another plank in a turn toward deeper government involvement in commerce. Timing of these adaptations, or even more substantial changes, seems less important to us than how policy affects current ‘hammer and nail’ economic dynamics.
It too soon to gauge whether and the degree to which the Biden administration, Congress, and the courts usher in a period of competition policy reform even approaching the magnitude of a century ago by the Progressive Party led by Theodore Roosevelt (one observable difference is the lack of overt racial overtones in this version). But from taxation to antitrust law, pressures at the state and national level point to a deepening of government involvement in commerce unlike a period since then.
It’s important that those of us still grieving the loss of colleagues or loved ones from the horror of that bright Tuesday morning twenty years ago keep their sacrifices uppermost in mind. Our ability to work, recreate, and emote define the elemental differences between us and them. Sharing stories of their lives before that morning is one way to accurately pass on this collective history of our country and some of the great people no longer able to enjoy its bounties
