GRAEME SLOAN/SIPA USA VIA AP
Some of Kamala Harris’s donors want her to oust Federal Trade Commission chair Lina Khan.
This article appears in the October 2024 issue of The American Prospect magazine. Subscribe here.
For 40 years, untrammeled monopoly power has been the defining characteristic of the American economy. In the 1980s, after a laissez-faire approach to antitrust laws originating with the Chicago school took hold in the Reagan administration, wealth inequality soared and new innovators struggled to break through an incumbency advantage favored by Wall Street.
Only during the Biden administration have those trend lines begun to change, thanks to a new crop of antitrust regulators: Federal Trade Commission chair Lina Khan, Jonathan Kanter at the Department of Justice Antitrust Division, and Consumer Financial Protection Bureau director Rohit Chopra have sent a clear message that the full body of anti-monopoly laws will be enforced to ensure open, competitive markets for consumers, businesses, and workers.
The presidential election will decide whether this brief window of opportunity to radically reshape economic liberty in this country can fully take root as a more permanent policy structure. But the stakes for corporate power are uniquely multifaceted. It’s one of the rare policy areas where a baseline consensus has emerged, in large part because of a massive political shift since the 2008 financial crisis.
On both the left and right, populist factions are battling it out with a more corporatist political establishment for the soul of their respective parties. But when it comes to the actual governing record, Democrats have been far more willing to challenge monopoly dominance than Republicans.
Notoriously erratic and fickle, Donald Trump has shed the economic populist instincts he tapped into during the 2016 campaign, and cozied up to segments of the business world that previously viewed him with suspicion. Kamala Harris, on the other hand, resisted articulating a full policy vision until early September, when her campaign finally launched an issues page on her website. The economic platform gestures at giving new powers to antitrust enforcers under the overall framing of going after “bad actors,” a vague designation that leaves a lot of questions up to interpretation.
Despite Harris’s coy attitude toward policy, the political incentives are more aligned in the Democratic coalition for her to inherit the strongest administration on corporate power in decades, and give them four more years.
BASED ON RECENT POLLING, A MAJORITY OF VOTERS blame corporate price-gouging for inflation and support breaking up monopolies as a tool against it. The C-suite executive class also views antitrust and competition policy as one of the top issues on the ballot this November, but for entirely different reasons.
For months now, companies have been selectively timing the announcement of new acquisition targets, in the hopes of a more business-friendly administration with a more relaxed merger policy to wave deals through. Behind the scenes—and sometimes in public—Wall Street has also been waging an all-out pressure campaign to urge the next Democratic administration to remove Lina Khan from the FTC.
Those efforts didn’t really stand a chance with Biden as the nominee. But corporate leaders saw an opening when Harris, a Californian close to Silicon Valley, stepped in as the party’s new nominee. Her close advisers include the general counsel of Uber (who is also her brother-in-law) and a lawyer representing Google against an active Department of Justice antitrust lawsuit.
When Harris took over, a procession of CEOs and business leaders, led by Democratic mega-donor and LinkedIn co-founder Reid Hoffman, went on cable shows to demand Harris oust Khan. Maryland’s governor, former investment banker and Harris ally Wes Moore, echoed this on CNBC. When asked directly about Hoffman’s proposition to move on from Khan, he said, “I think we will and I think we have to … There are going to be different dynamics that are going to require different philosophies.”
The remarks from donors came off as a thinly veiled quid pro quo and sparked widespread backlash. Even more centrist lawmakers in tough re-election races, like Sen. Jacky Rosen (D-NV), scrambled to post pictures in a room with Khan to show support. Hoffman was forced to recant during a later CNN interview, claiming he was merely speaking about Khan as an “expert,” not a donor.
Harris has never commented on the incident, nor has she committed to keeping Khan if she wins, despite championing several of the policies of Khan’s agency on the campaign trail. However, she put some progressives’ concerns to rest with her economic-policy rollout in August. It included a federal ban on price-gouging for groceries, a crackdown on algorithmic price-fixing in housing, and reforms for pharmacy benefit managers driving up drug costs. Within weeks, DOJ sued RealPage over rental price-fixing, buttressing Harris’s message.
Undeterred, monopolists continue to pressure Harris’s campaign. They aren’t wrong to view the election in such consequential terms.
IT TOOK REAGAN TWO TERMS, AND REALLY A THIRD under George H.W. Bush, for the Chicago school consumer welfare standard to become fully ingrained. If the neo-Brandeisians get another four years with a Harris administration, they will be able to more fully institutionalize one of the most far-reaching policy revolutions since the New Deal.
In the first year of his administration, President Biden issued an extensive executive order laying out a whole-of-government approach to competition. The document all but dethroned the old enforcement model of the Chicago school and gave his new-guard antitrust regulators a green light to move forward with their agenda.
That agenda has resulted in a sweeping policy overhaul. Several of America’s largest Fortune 500 companies are facing antitrust lawsuits. Agencies have gone after scam robocall farms and initiated rules to make it easier for people to cancel digital subscriptions, limit credit card late fees, or ensure medical debt doesn’t appear on credit reports. The most significant new rule, the FTC’s ban on restrictive noncompete agreements in employment contracts, will ultimately be determined by the Supreme Court, and along with it whether the FTC has authority to create new rules through its unfair methods of competition powers.
The real risk is that Trump will use antitrust law as a blunt political tool to go after his enemies.
The new merger guidelines, finalized by the FTC and DOJ last year, amount to a new corporate charter for how business can grow, and establishes that companies must innovate rather than acquire competitors for market share. While there have been some setbacks operationalizing this approach to corporate power, by the FTC’s count they’ve won in court or otherwise stopped roughly 90 percent of their merger challenges. DOJ has tallied notable victories, such as blocking the Spirit-JetBlue airline merger, and publisher Simon & Schuster’s proposed combination with Penguin Random House. In August, Google was found guilty of monopolizing search markets, the first major monopolization verdict in a quarter-century. These victories have shown that neo-Brandeisian legal theories can hold up in court.
The Google search ruling in particular could prove a major precedent for other monopolization cases the FTC and DOJ have filed, including Big Tech cases against Apple, Amazon, Meta, and a separate case against Google for monopolizing adtech markets being heard now. DOJ also has the RealPage lawsuit, and a monopolization case against Live Nation for rolling up the concert venue, promotion, and ticketing businesses.
“Once a few more of these cases win in the courts, you’re going to witness a sea change in how businesspeople operate,” said Matt Stoller, policy director of the American Economic Liberties Project.
THE FATE OF THIS PROJECT TO FIGHT ECONOMIC concentration depends on the next administration’s appointments and continued support.
Anti-monopoly policy still relies heavily on the inexorably slow litigation process. It usually takes more than one presidential term to initiate an investigation into a company, file a monopolization case, argue it in court, and then hash out a remedy if the government wins. That’s a near-Herculean task for chronically understaffed enforcers whose funding is continuously put at risk in congressional appropriations.
By its very nature, this process requires more than four years to accomplish. Some antitrust experts believe this predicament necessitates some degree of bipartisan consensus, given how frequently the White House swings between party control in our current political era.
On this front, Trump has not exactly instilled confidence this election cycle. It’s hard to imagine that on the trail in 2016 he pledged to break up a giant telecom merger, calling it “too much concentration of power in the hands of too few.” Granted, the merger was between AT&T and Time Warner, the owner of CNN, a media organ hated by Trump. But it was a legitimate competition issue; his DOJ followed through on filing the merger challenge, but lost (only for AT&T to voluntarily sell off Time Warner in 2022).
During the current campaign, Trump has been more eager to court the Business Roundtable and Silicon Valley oligarchs. The latter have been core to his support and are influencing his agenda. His current platform says nothing about monopolies, but does promise light-touch regulation for crypto and essentially no government interference with the development of artificial intelligence. That’s a stark contrast with the current FTC and DOJ, which are probing the OpenAI-Microsoft partnership and AI chipmaker Nvidia.
Despite his more business-friendly posture, Trump did pick as his running mate J.D. Vance, a bȇte noire of the GOP’s old guard, who comes from the populist wing of the party. On several occasions, Vance has openly praised Lina Khan, one of the few Biden regulators he thinks is doing a “pretty good job.” Some antitrust proponents on the right believe that Vance will steer the policy direction of their administration.
“We’re certainly a minority in our party but the energy is on our side … we expect that to carry through to appointments,” said Jon Schweppe, policy director at the American Principles Project, who worked on the antitrust sections in Project 2025 as part of the broad coalition assembled by the Heritage Foundation.
The Project 2025 antitrust section is internally conflicting, but there’s consistency in one respect: calling for dismantling the CFPB, whose constitutionality has been under legal threat since its origination. Many of the Bureau’s current rules, yet to be finalized, would likely be gutted under Trump, based on his first administration’s CFPB.
But there is reasonable optimism for a modicum of continuity on antitrust, even if Trump wins. Khan and Kanter have been far more coherent and bold about their policy direction, but in key respects they inherited some of the previous administration’s work on corporate power, which began the initial break from neoliberal orthodoxy.
The Biden DOJ gets credit for winning the Google search case, but it was first filed by Trump’s DOJ Antitrust Division head Makan Delrahim. The Republican-chaired FTC under Trump also filed an antitrust case against Facebook, targeting its acquisition of Instagram and WhatsApp. That case is being pursued by the current FTC.
Delrahim’s DOJ even brought some unexpected cases in labor markets, targeting no-poach agreements where competitive employers conspire not to hire each other’s employees. That was a rough precursor to the noncompete ban.
The next Trump administration would likely continue the cases against Big Tech, which conservatives view as harboring liberal bias. There could be overlap on some health care policies too. Republicans have started to rally behind cracking down on pharmacy benefit manager middlemen that drive up drug costs. Republican FTC commissioner Andrew Ferguson voted with the Democrats this July to issue a damning interim study of the industry. Pharma patent abuse is another area of convergence. “Institutional heft at the agency to take on bogus patent listings is pretty well solidified at this point,” said Spencer Waller, a law professor at Loyola University Chicago, who mostly recently served as senior adviser to the FTC.
The real risk is that Trump will install loyalists at the antitrust agencies to use the law as a blunt political tool to go after his enemies, and not pick particularly impactful legal cases. This was the legacy of Delrahim. Trump certainly won’t touch industries dominated by GOP donors, such as oil companies, or anything tech-related that harms his new Silicon Valley cronies.
SELECTIVE ENFORCEMENT IS ALSO A CONCERN for a future Harris administration. Her framing of taking on “bad actors” does not establish clear principles for what is and isn’t fair competition. Is Google, for example, a bad-actor monopolist? Harris doesn’t specify, despite a court ruling that the company violated the Sherman Act. It’s a far cry from the Biden executive order on competition, which diagnosed America’s monopoly problem as a widespread, systemic issue.
Politically, though, Harris is well positioned to continue the Biden administration’s legacy, albeit perhaps under some modified directives.
Her campaign’s rollout is especially focused on the consumer protection side. It makes sense to highlight those actions in an election year when inflation is still a major concern for voters. But it also hints at a quiet return to the consumer welfare standard, which could bleed into the policies that enforcers are pressured to target under her administration. “I see a lot more room for crackdowns on junk fees across numerous sectors. Both Biden and Harris have made that a priority,” said Waller.
If Harris keeps Khan and Kanter—and there will be significant grassroots pressure to do so—their agencies will be able to finish the work they’ve already initiated and focus on clear-cut remedies to the monopolization cases. Existing litigation will take up much of their allocated budgets, but a handful of other cases could be pursued. There are active investigations into OpenAI, Nvidia, and the health care giant UnitedHealth.
There’s also hope within the anti-monopoly movement that agencies will fully resuscitate a dormant prong of antitrust law, the Robinson-Patman Act, which targets pricing discrimination.
These ambitious policy efforts require a lot of time and resources, as well as the luck of the draw in the courts. But the transformational power of this work is already playing a major role in this year’s election. It could reshape our country’s politics for decades to come, if the revolution under way can coalesce.
