Bring Back Antitrust

This article appears in the Fall 2015 issue of The American Prospect magazine. Subscribe here.

In the late 1980s, Thomas Shaw of Little Elm, Texas, watched a news report about surging HIV and Hepatitis C contractions among health-care workers. When treating patients, nurses and hospital personnel would accidentally stick themselves with used needles.

Shaw had childhood friends suffering from AIDS, and he wanted to help. "I knew I couldn't fix the biology side of it, but I could fix one part because I'm a mechanical engineer," Shaw says. So he went to the nearest drugstore and bought a bunch of syringes. He spent years taking them apart until he finally came up with a way to solve the needle-stick epidemic.

Shaw's syringe operated like a ballpoint pen: Once you fully depressed the needle into the patient, a ring would snap and retract the needle, allowing workers to safely pull out the implement. He called it VanishPoint. If disposed of after a single use, it would eliminate needle-stick entirely.

Shaw patented VanishPoint and formed a company, Retractable Technologies, in 1997. He got a Small Business Innovation Research grant, $650,000 from the National Institutes of Health, to manufacture his product and get it to market. But that's when he learned about Becton, Dickinson & Co. (BD), which sells 80 percent of all syringes in America.

After 18 years in operation, after a federal law mandating that hospitals work to prevent needle-stick, and after two successful lawsuits resulting in BD paying more than $400 million for violating anti-monopoly statutes, Retractable Technologies made only $34 million in global sales last year. BD, with an inferior, more expensive product, sold $8.4 billion, the payouts to its competitor serving only as the cost of doing business. In 2000, the Centers for Disease Control estimated 380,000 needle-sticks at hospitals every year. Today, they estimate 385,000.

"You turn on the TV and watch politicians talk about unleashing the power of the free market, that's absurd," Shaw says. "The American public is being denied a free market, being denied competition."

THE TIGHT GRIP OF incumbents on the medical-supply industry is far from exceptional. Much of what we buy comes from a deceptively concentrated market. This is all the more surprising, given the wave of competition unleashed by the Internet.

The unaware consumer walks into a supermarket and sees aisles brimming with a daunting array of choices. But the majority of products come from just ten manufacturers. You're made dizzy by the sheer variety of toothpastes, for example, but 70 percent of sales go to just two companies: Proctor & Gamble and Colgate-Palmolive.

One company, Luxottica, makes virtually every different brand of sunglasses in the world. They also own nearly all the eyeglass retail outlets, from LensCrafters to Pearle Vision to Sunglass Hut. Several years ago, Tyco bought up all its competitors and now makes practically every plastic hanger in America. You'd be excused for thinking you have many options for booking airline tickets and hotels online, but when the Expedia-Orbitz merger clears, there will only be two (Priceline is the other).

America gets its cable and Internet service mostly from four companies, after AT&T's successful merger with DirecTV. There are only three big airlines, four if you count Southwest; four big commercial banks; and five big trade-book publishers, six before Random House merged with Penguin.

Even where you don't discern market concentration, it lurks behind the scenes.

"Underneath GM and Chrysler are the suppliers," says the New America Foundation's Barry Lynn, author of the book Cornered: The New Monopoly Capitalism and the Economics of Destruction. "There are different brands, but everyone's using the same windshield wipers and the same alternator. With cat food there are like 100 different brands, but they're all coming out of the same plant."

This accelerated consolidation can be self-perpetuating, with incumbents discouraging competitors from getting a foothold, or buying them up as soon as they gain some market share. Market concentration has a powerful impact on the day-to-day lives of every American, not just because monopolists have pricing power. Monopolies can also stunt innovation, degrade quality of service, increase inequality, and concentrate political power.

This trend operates against a background of weakening antitrust enforcement. Some of the new techniques to defend market power were not anticipated by the authors of the major antitrust laws more than a century ago. Others would be all too familiar, such as squeezing and then buying out competitors, or creating tying arrangements to compel a consumer to buy one product as a condition of buying another. "We're back to a little bit of the new Gilded Age," says Allen Grunes, a former antitrust official at the Justice Department.

This hidden concentration and its negative effects on consumers may seem paradoxical. First, this is a low-inflation economy. So if monopolists are jacking up prices, why does this not show up in a higher consumer price index? Secondly, thanks in part to the Internet, some innovation does result in greater consumer choice and price discipline. Amazon, for instance, has forced booksellers to cut prices. Internet shopping generally increases consumer knowledge to shop for the best deals.

But in a segmented economy, monopoly pricing power and suppression of innovation in some sectors can co-exist with competitive markets elsewhere. As for low inflation, much of it reflects depressed wages, in some ways driven by market concentration. So the consumer is hit twice-once in the paycheck and again at the store. And the Internet, for all of its ability to facilitate shopping around, has facilitated platform monopolies or near-monopolies such as Amazon and Google, with other anti-competitive effects.

RETRACTABLE TECHNOLOGIES initially held talks with BD about licensing their VanishPoint syringe. But BD would not commit to actually using the technology, which would have required them to retool machinery. Thomas Shaw didn't want to see VanishPoint die. But even after getting clinicians interested in using the syringe, he couldn't get hospitals to buy it.

(Photo: AP/Seth Wenig)

As a Washington Monthly story in 2010 on Retractable explained, most hospitals acquire supplies through group purchasing organizations (GPOs), coalitions of affiliated hospitals that buy in bulk at a discount. The vendors actually pay all the GPO's administrative costs, as long as the hospitals buy entirely from the narrow group of vendors. Shaw discovered that BD had contracts through GPOs with a "90/10" requirement. If a hospital bought 100 syringes from BD last year, they had to buy 90 the next year to qualify for the discount. If the hospital failed to purchase 90 percent, they would lose the discounts and pay a penalty, a cost of millions of dollars. This contractual obligation fortified the monopoly.

Unable to sell his product, Shaw worked with nurses' organizations to pass the Needlestick Safety and Prevention Act in November 2000. It revised rules from the Occupational Safety and Health Administration, mandating hospitals to reduce their reliance on equipment that exposes workers to blood-borne pathogens. Committees within hospitals would have to "document annually consideration and implementation of appropriate commercially available and effective safer medical devices." But hospitals still resisted Retractable's syringe, wary of breaking the GPO contracts.

Shaw went to the Federal Trade Commission in 2002, complaining about being locked out of the market. The FTC had jurisdiction to bust up monopolies, but took no action. Shaw also sued BD and several GPOs under the Sherman Antitrust Act. BD settled the case for $100 million in 2004. Retractable Technology took the money to survive as a viable business. But even after the settlement, nothing changed. The $100 million was the going rate for BD's shareholders to maintain their monopoly, a pittance compared to its profits.

AMERICAN PROGRESSIVES have long had an ambivalent view of bigness. The split was evident in the presidential election of 1912. Bull Moose Teddy Roosevelt's idea was to allow some concentration to most efficiently distribute goods, but to let experts regulate those firms for the public benefit. Democrat Woodrow Wilson, and his adviser Louis Brandeis, saw concentrated power as dangerous, and held that monopolies that unduly restricted competition should be broken up.

The fuel for the Brandeis-Wilson perspective came from below. In the late 19th century, economic regulation was a function of the states, which were unable to deal with the rise of giant national trusts. The growth of railroad and telegraph monopolies restricted the channels for the flow of information and the transport of goods, raising prices in some cases and denying access to markets in others. Farmers, gouged by railroad tycoons and fearful of the trusts' power, organized the Granger movement and others, fomenting a revolt against these practices and ultimately compelling national politicians to act.

The Sherman Antitrust Act of 1890, passed almost unanimously by Congress, gave the Justice Department (and later, via the Clayton Act, the Federal Trade Commission) authority to attempt to block anti-competitive mergers and price-fixing through the courts; the act authorized criminal penalties as well as civil remedies. But the Sherman Act authors made clear that "innocent monopolies" created by superior business practices could be tolerated as long as they did not suppress innovation and price competition. So even in the heyday of antitrust, the courts rejected the proposition that size per se was anti-competitive. Restraints of trade had to be demonstrated.

In Standard Oil v. United States, for example, the Supreme Court effectively modified the Sherman Act, saying that monopolistic restraint of trade was only objectionable if it was "unreasonable," a determination to be made by the courts. The decision did break up Standard Oil, ending their Gilded Age dominance. However, U.S. Steel won its antitrust case in 1920, as did International Harvester in 1927, because they passed the reasonableness test.

Without a bit of monopoly power, pure competition would be mutually ruinous to necessary profits and innovation.

The economist Joseph Schumpeter famously wrote, "Every grocer, every filling station, every manufacturer of gloves or shaving cream or handsaws has a small and precarious market of his own that he tries-must try-to keep by price strategy, quality strategy, 'product differentiation'-and advertising." This was what mid-century economists termed Monopolistic Competition-a balance between pure competition and some necessary market power.

Some cases, however, were deemed so potent that they required companies to be broken up. In United States v. Alcoa (1945), the Court referred the case to the Second Circuit Court of Appeals, which ruled that even though Alcoa didn't pursue an industry monopoly, their acquisition of one through superior management could and did enable them to engage in monopolistic behavior. So they found Alcoa guilty of violating the Sherman Act, in a way that would never hold today. The 1953 case against United Shoe Machinery found the same thing. The 1966 proposed merger of Von's and Shopping Bag grocery stores, which would have created market concentration of just 7.5 percent in the Los Angeles region, faced a court-ordered breakup. "During antitrust's structural era, horizontal mergers were strongly presumed to harm competition," wrote law professor Jon Baker of American University in 2013.

In general, the Justice Department's Antitrust Division was fairly aggressive during the period between the 1930s and the 1960s, seeking to safeguard market competition while recognizing that scale could sometimes be pro-competitive. And then, a future failed Supreme Court nominee named Robert Bork took this nuance to an extreme, arguing that antitrust enforcement was actually bad for innovation and consumer well-being.

IN HIS 1978 BOOK The Antitrust Paradox, Bork, a devotee of University of Chicago economic theories, contended the Sherman Act was merely a "consumer welfare" prescription, not a presumption against market power (which generally can't exist in Chicago theory). So if a merger made the resulting business more efficient, that merger should be approved. Scale, likewise, generally enhanced efficiency. In both cases, consumers would see the benefits in lower prices. If the incumbent abused its dominant position and raised prices beyond a market-clearing price, competitors (by definition) would invariably arise. The power of incumbency was assumed away. The "paradox" of his book's title was that antitrust enforcement made consumers worse off.

Recent scholarship has shown Bork's assumptions to be backward. John Kwoka, an economics professor at Northeastern University, collected retrospective data on 46 closely studied mergers, and found that 38 of them resulted in higher prices, with an overall average increase of 7.29 percent. In cases where the Justice Department imposed some sort of condition for accepting a merger, like divestiture of some product lines or bans on retaliation against rivals, the price increases were even higher, ranging from 7.68 percent to 16.01 percent. By this analysis, consumers don't benefit at all from merger activity, as market power overwhelms whatever efficiency gains.

(Photo: AP/Charles Dharapak)

Senate Antitrust, Competition Policy and Consumer Rights Subcommittee Chair Senator Amy Klobuchar (a Minnesota Democrat) and Ranking Member Senator Mike Lee (a Utah Republican) listen to testimony during a subcommittee hearing regarding the AT&T and DirecTV merger, which was completed in 2015.

But Bork's ideas found a ready ally when Ronald Reagan took the White House. In 1982, Bill Baxter, head of the Antitrust Division at the Justice Department, rewrote the guidelines the agency would use to examine mergers, incorporating many of Bork's theories. The earlier 1968 guidelines, authored by Assistant Attorney General Donald Turner, looked skeptically upon mergers where the resulting company would control as little as 5 percent of an industry. Baxter's rewrite incorporated supposed efficiency into the equation, and significantly increased thresholds for market concentration that would even trigger official scrutiny, much less litigation.

Changing the enforcement guidelines transformed antitrust policy without altering a comma of the law. What was once a political issue became a question for micro-economists, and corporations could always find one to assert massive efficiencies from any merger. Judges began to require a higher threshold for merger challenges as well as a presumption against abuse of market power, as the Bork intellectual theories infected the entire apparatus.

IN 2007, RETRACTABLE Technologies sued BD again. They claimed that BD marketed inferior "safety" syringes to comply with federal law. Their main safety syringe was a retrofit of BD's old plastic one, which added a sheath that health-care workers would slide over the needle. This only created one more potential for a needle-stick during the sheathing.

Retractable alleged that BD intentionally kept their substandard syringe on the market to drive down public perception of the VanishPoint. They also claimed that BD lied about the sharpness of their needles and the accuracy of their measurements of medicine.

After six years of legal wrangling, a jury ruled on the antitrust portions of the case, agreeing with Retractable that BD sought to monopolize the syringe market and made false statements to customers. A federal district court affirmed the jury's verdict, awarding Retractable $340 million in damages and requiring BD to admit it lied to customers. The case is pending before the Fifth Circuit Court of Appeals, but BD did send letters to its GPOs acknowledging the lies. One responded by canceling Retractable's contract instead.

Instead of relenting after having two antitrust cases go against them, BD sought approval last fall at the FTC for a merger with medical supplier CareFusion. Retractable wrote to the FTC strongly objecting to the merger, highlighting the millions of health-care workers unnecessarily harmed by BD's monopoly over syringes, the company's admitted falsehoods, and the harm to competition from allowing the market to entrench further. The FTC never responded to the letter, and cleared BD's merger.

SINCE THE REAGAN JUSTICE Department neutered antitrust enforcement, a posture substantially ratified by increasingly conservative courts, two new factors have reinforced the trend. The first is the rise of intensified merger and acquisition activity, driven less by economic efficiency than by the fact that M&A is a huge Wall Street profit center that fits with the desire of CEOs to run bigger empires that produce fatter paydays.

Mergers and acquisitions activity is poised to hit a record this year, with $4.58 trillion in takeover announcements expected.

Obviously, more mergers mean more commissions for the Wall Street firms that shepherd the deals, as well as more opportunities to profit from trades. Investors are also demanding consolidation as a means to increase pricing power and to show growth. It's easier to use market power to extract more from suppliers and consumers than to make a better product and increase sales volume. "From society's perspective, it's complicated. But from the inside, I always want to have a monopoly," said billionaire venture capitalist Peter Thiel in London in May.

The preference for debt over equity in the tax code also incentivizes mergers, since borrowed money to acquire companies produces a tax break. In principle, antitrust enforcement provides a counterweight, but as merger activity has increased, antitrust has declined. Today, corporate America's most innovative activity is financial engineering, rather than invention that enhances consumer welfare.

Despite all the buzz about the start-up culture, entrepreneurship has suffered from these barriers to competition. The New America Foundation found start-ups fell 53 percent between 1977 and 2010. This removes urgency from incumbents to invest, and makes the economy sluggish.

Merger activity, John Kwoka shows, typically leads to price increases, as companies controlling concentrated markets gouge consumers. You can see the consequences of oligopolistic pricing simply by looking at your cell phone or cable bill, sectors where dominant players still enjoy market power.

A second complicating factor is the rise of electronic commerce. In principle, this should be good for competition and consumer welfare. But here we need to introduce the lesser-known cousin of monopoly-monopsony, meaning market power exercised by a dominant seller, or in the case of the Internet, a dominant platform. A good illustration is the market power that Google enjoys over the division of advertising income. It piggybacks on expensive content generated by magazines, newspapers, and others in the media, and takes a large share of advertising revenues. There have been widespread complaints that Google uses its market power to take too big a cut of the advertising dollar at the expense of content originators. Senator John Sherman, author of the Sherman Act, never anticipated this abuse in 1890.

Digital platforms using market power gained by controlling access to their audiences is a variant on the venerable problem of common carriers that abuse their positions as choke points. As early as 1913, the U.S. government began treating AT&T as a regulated monopoly, and insisted that it provide connectivity with rival independent phone companies. Regulators have not asked the same of Google or Facebook. "We have one fantastic victory in recent times, net neutrality," said Barry Lynn of the New America Foundation.

"For some reason, the wise folks at DOJ and FTC are not able to see that Amazon is largely analogous to the cable problem, the broadband problem. You need a neutral platform."

Courts have on occasion held that abuses of monopsony are antitrust violations. In the A&P case of 1949, the Supreme Court agreed that A&P was using its dominant economic position to demand discounts from suppliers that were not available to its competitors, thus denying a level playing field among supermarkets. But there have been no successful cases against Google or Amazon for abusing their dominant position as platforms. Late in the Clinton administration, the FTC issued a staff paper warning of the multiple potentials for abuses of market power in e-commerce. But in a follow-up report under George W. Bush, the FTC held that the Internet was only beneficial for consumer welfare. Platform monopsony should be a fertile area for FTC investigation, but President Obama's FTC has been quiescent.

The rise of the Internet has been double-edged for market concentration. For example, Amazon is the dominant delivery outlet for books, willing and able to keep out publishers if they don't conform to their standards. This produces bargains for consumers, but undermines supplier industries, in this case author royalties and publisher earnings. "The focus on consumers led people to think, if Amazon can get cheaper prices, who's to complain, without realizing that monopsony power is squeezing authors," says Nobel Prize–winning economist Joseph Stiglitz. "The consumer may get better prices, but not on the other side."

Monopsony creates many spillover effects. Suppliers can cut corners on labor and environmental standards to keep their profit margins up amid the squeeze. Wages can drop. So even if inflation stays low, the public can suffer. In other words, while some monopolies and monopsonies generate "cheap" goods for Americans, antitrust policy should look beyond simply prices and efficiency to incorporate all of the consumer effects of market concentration. And they are legion.

THE CASE OF RETRACTABLE Technologies shows how monopolies can inhibit innovation, by preventing start-ups from getting products out. Monopolization also has a significant effect on quality of service. With reduced competitive pressures from the outside, businesses have no reason to upgrade services.

Concentrated markets magnify disruptions. On July 8, IT issues knocked out the New York Stock Exchange, and the computer system of United Airlines went down. Because the NYSE has competing exchanges, others picked up the trading slack and stock volume went virtually unchanged. Because there are only three other major airlines, and in many cases none that fly the same routes as United, the computer glitch grounded thousands of flights nationwide and caused bottlenecks and flight delays that lasted for days. There were no redundancies in the airline industry to step in.

Retractable Technologies, Inc.

In many sectors, such as health care, market concentration leads to more market concentration. Hospital consolidation was motivated in part by providers' desire to increase their ability to bargain with insurance companies for better prices. In reaction, insurance companies also consolidated, each side seeking leverage over the other. Once Anthem completes their merger with Cigna, and Aetna merges with Humana, there will be a "Big Three" in health insurance (UnitedHealth is the other).

Perhaps most critically, given the current political climate, monopolies drive inequality. Executives and Wall Street traders make astronomical incomes, while wages are squeezed. Post-merger price increases, from health care to cable TV service to airline tickets, translate into a decline in real wages. Big mergers also encourage reduction in actual wages, when consolidations produce layoffs and limit avenues for employment. And though high skills are supposedly a defense against wage cuts, cartel behavior by Silicon Valley firms to prevent raiding each other's workers kept wages for coders and engineers low.

Suppliers to platform monopolies experience a price crunch across the spectrum, reducing their own profits and funneling them to the biggest firms, where they pass to executives. "High concentration in the PC platform market with Microsoft gives rise to the richest person in the country," says Stiglitz. "Monopoly increases wealth at the top, and for average Americans real wages decrease."

Senator Sherman did not anticipate the Internet, but he previewed this broader problem in 1890 when he warned of the "inequality of condition, of wealth, and of opportunity that has grown within a single generation out of the concentration of capital."

And in the Citizens United age, all this market power and collection of exorbitant monopoly profits can't help but lead to the entrenchment of political power.

"Monopolies are as much political forces as they are economic ones," says Zephyr Teachout, a former New York gubernatorial candidate and Fordham University law professor who now runs Mayday PAC, a federal political organization dedicated to public financing of elections. "I talk about fair elections as the rhythm of an open, free democracy, and decentralized economic power as the melody."

THIS PAST JULY, RETRACTABLE Technologies wrote a 15-page letter to FTC commissioners, stressing how the agency "has sat on its hands while America's dedicated health-care workers have had their hands pricked, stabbed and bloodied by needles that often carry deadly diseases." The company reiterated the long history of anti-competitive practices by BD, including the two occasions where courts found them guilty of attempted monopolization. "Retractable Technologies would like to know just how much court-verified public harm a company has to commit before the FTC will be motivated to do its job," the letter concluded.

In response, the FTC's Health Care Division met with Shaw, Retractable's CEO, in late August. Regulators admitted that American consumers pay more for health-care products than any country in the world, and Shaw offered that market concentration and the GPO hustle contributed to that. But the lack of resources and the need to expend so much effort on complex economic models to justify a case forces the FTC to choose its battles judiciously.

"They said, if you had a case where everything's done, maybe we could get something done," Shaw says. "Short of that, there's nothing they can do. My problem with that as a taxpayer and inventor and manufacturer is, if they're not coming to Little Elm and starting a business, why am I coming up here to do their job?"

AP Photo/Virginia Mayo

AT THE OUTSET of the Obama administration, things looked promising for a resurgence of antitrust. George W. Bush's Antitrust Division had been dismissive of antitrust, in a manner straight out of the pages of Robert Bork. Antitrust chief William Kolasky said in a speech in 2002, "All of us know that the rationale for most mergers is pro-competitive and that most mergers have no adverse effects on competition." Bush's FTC issued a report on Section 2 of the Sherman Act that was deferential to monopolies. The incoming Obama administration withdrew it.

Then, the new head of the Antitrust Division, Christine Varney, held joint hearings with the Department of Agriculture in five cities, with Attorney General Eric Holder and Agriculture Secretary Tom Vilsack attending. The field hearings looked at monopsony power-the concentration of agribusiness conglomerates, like Tyson, ratcheting down the rates they pay farmers for meat and poultry. "This was great, all these farmers, herders, everyone involved in the production of food, they're up in arms," says Maurice Stucke, antitrust law professor at the University of Tennessee. "DOJ itself said, the message is coming through."

But when it came to actual enforcement, the administration largely took a pass. According to data collected by Northeastern University's John Kwoka, from 2009 to 2011, for every merger that reduced competitors in a market to four or fewer, the administration made some investigation or challenge. But for mergers that left five or more competitors, they enforced none of them. Historically, a good chunk of those would have been challenged. "These are moderately concentrated industries, right on the cusp," Kwoka says. "They took a pass on every one of them. It's remarkable and a complete anomaly."

Stucke points to a George's Foods acquisition of a Tyson poultry processing plant in Harrisonburg, Virginia, that the Justice Department decided to challenge. Instead of blocking the acquisition, the Antitrust Division required minor capital improvements to the plant, including repairing the roof. "They settled on, it was like chicken feed," Stucke says. "I can't think of any other case where part of the remedy is to repair the plant's roof."

These conduct remedies are precisely the ones that Kwoka showed to be extremely ineffective in his retrospective studies. Yet they became a hallmark of Obama-era antitrust enforcement. The Comcast-NBC merger included a series of behavioral remedies. US Airways and American Airlines had to merely divest some slots at Reagan National and LaGuardia Airports. The LiveNation-Ticketmaster merger also included conditions, like divestitures and anti-retaliation provisions. Three years later, the merged company controlled more than 80 percent of the primary event-ticketing market.

It's true that the administration faces hurdles from a judiciary that still adheres to the lessons of the Chicago school and places heavy burdens on the enforcement agencies. In Verizon v. Trinko (2004), Justice Antonin Scalia called charging monopoly prices "an important element of the free-market system," and said that it must be protected "to safeguard the incentive to innovate."

"One problem is that bad cases not brought by the government tend to make bad law," says Allen Grunes, the former antitrust official, now in private practice. "The Supreme Court has been able to cherry-pick those cases to move things in a conservative direction."

But the administration's decision to close four of the seven antitrust field offices (in Atlanta, Cleveland, Dallas, and Philadelphia) in 2012 was taken as a strong signal. These field offices did primarily criminal cases, such as conspiracies to rig municipal contracts or construction bids. Dozens of prosecutors lost their jobs. The shuttering of over half of the field offices damaged agency morale. "The remaining offices can't cover the territory," says Robert Connolly, chief of the field office in Philadelphia when it was closed.

"I think there's a sense that the Antitrust Division is not that interested in local and regional cases. … They want a case with headlines, a lot of zeroes."

The administration has had a better record on mergers that created heavy market concentration, blocking proposed mergers such as AT&T with T-Mobile, and Comcast with Time Warner. More recently, enforcement agencies have been praised for investigating the airline industry for price collusion, suing to block General Electric's sale of its appliance business to Electrolux, and stopping the merger of the nation's two largest food distributors, Sysco and U.S. Foods.

In some sense, these successes represent a last frontier. "Many of our industries have simply hit the wall, with high levels of concentration allowed by 20 years of lax enforcement," says Diana Moss, vice president of the American Antitrust Institute. "As a result, mergers in markets with two, three, or four rivals are almost always going to raise competitive concerns. … The next administration is looking at a pretty grim landscape."

BD'S ANTI-COMPETITIVE behavior dates back to at least the Eisenhower administration. Back in 1960, the Justice Department cited BD for price-fixing violations of the Sherman Act. BD agreed to a consent decree, but the company took advantage of a quirk in the language of the order. The consent decree only committed BD to end their illegal practices for reusable glass syringes. So BD simply shifted to plastic disposable syringes, and engaged in the same behavior. In fact, the routine reuse of plastic syringes by replacing the needles exposed patients and health-care workers to equipment that could not be re-sterilized, facilitating the global AIDS and Hepatitis C outbreaks.

Despite 55 years of anti-competitive behavior, BD's market monopoly remains in place. And tellingly, no other medical supply conglomerate has ever tried to enter the market. "Johnson & Johnson told us, they don't sell Band-Aids and we don't sell syringes," says Thomas Shaw. The market split allows monopolies to maximize profits as long as they stay out of competition.

The big guys don't mess with one another's markets, and the little guys can't get in.

Shaw believes his plight will only change if the public wakes up to the perversion of the free market, which long ago ceased to miraculously guide toward the best solutions through open competition. In fact, the markets don't self-correct. "There are a lot of invisible hands, most of them are in our pockets," Shaw says.

In 1964, historian Richard Hofstadter gave a speech at the University of California, Berkeley, titled "What Happened to the Antitrust Movement?" He wondered why anti-monopoly sentiment ceased to become the subject of public agitation. "Once the United States had an antitrust movement without antitrust prosecutions," Hofstadter said. "In our time, there have been antitrust prosecutions without an antitrust movement."

Now we have lost both the movement and the prosecutions. When we talk about banks that are too big to fail, we're talking about antitrust. When we talk about the high cost of health care, we're talking about antitrust. So many of our key domestic issues are fundamentally questions about whether we should tolerate monopolies, or dismantle them. But this formulation-a centerpiece of public debate in the last robber-baron era between the 1880s and 1910s-has all but disappeared from popular discourse.

Can anti-monopoly sentiment be revived? When New York's Working Families Party first recruited Zephyr Teachout to run for governor, she said she would only do it if she could talk about monopolies. "They polled it, and they were correct that nobody knew what I was talking about," Teachout says. But when she eventually ran an insurgent campaign against incumbent Andrew Cuomo, she was determined to talk about it anyway.

"The minute you got past the sound-bite level, people responded to the concentration of power," Teachout says. They did campaign events at places where people paid their cable bills, using the pending Comcast–Time Warner merger, eventually abandoned, as the hook. She engaged farmers in upstate New York about monopsony power, and discussed Amazon and big banks on the stump. And it resonated. After only one month of campaigning, Teachout won 35 percent of the vote, with particular strength in upstate counties where farming issues were prominent.

"The Tea Party talks to people and says, 'You're out of power because government is taking it away from you,'" Teachout says. "Far too often, Democrats say, 'You're wrong, you're not out of power.' That's dissonant with our lived experience. You're out of power … because your priorities don't matter and JPMorgan's do."

Beyond Teachout, you can see through the haze the stirrings of a grassroots antitrust agenda.

The greatest anti-monopoly victory of the modern age, the Federal Communications Commission's net-neutrality rules, owed much to a smart, tech-savvy movement that leveraged big protest platforms.

Web-native activists fought for the decentralized power of the Internet, without gatekeepers collecting tolls along the way. And they made the connection to things like the Comcast–Time Warner merger, which failed amid public outcry.

"After this existential threat to the Web, you see the same groups becoming interested in the deep history of anti-monopoly laws," Teachout says. "It's kind of an exciting intellectual moment, a fusion between old-school farmers who have been complaining for 30 years and new net-neutrality dreamers."

Monopolists have long used technological advances to consolidate power, from Gilded Age tycoons leveraging control of railroads and telegraphs to Amazon using its first-mover status in e-commerce to squeeze book producers, or Google harvesting traffic to their market-leading search engine to serve ads. It's easy to translate the need for a neutral platform for websites into the same need for book sales or car ride–sharing.

The European Union, in fact, did file formal antitrust charges against Google, accusing it of forcing search engine users into its own shopping platforms, and bundling Android phones with their own apps, to prevent competitors from performing the same functions. The FTC shut down its own investigation into Google over the same concerns in 2013. But an inadvertent disclosure revealed that the agency's Bureau of Competition recommended bringing a lawsuit, arguing that Google's conduct "has resulted-and will result-in real harm to consumers and to innovation in the online search and advertising markets." The political leadership ignored the recommendation.

The next administration must show "leadership that has a certain intellectual curiosity," says Maurice Stucke, pointing to the Google case as a missed opportunity. An alteration in posture would make enforcement far more vigorous, and bringing more cases will give litigators more experience and confidence to negotiate the judicial barriers. The American Antitrust Institute plans to create a transition document for the incoming administration, as they did for the Obama transition.

But at a time of political disempowerment, teaching about the dangers of monopolies and how we have the laws on the books to fight them, and creating upward pressure to do it, offers great potential for a paradigm shift. Connecting Senator Elizabeth Warren's fight against a rigged financial system and Al Franken's fight against media concentration can spark broader political energy.

You could see this potential in Washington, D.C., where in August, the city's Public Service Commission rejected a merger between energy firms Exelon and Pepco, citing "more active participation by parties and interested persons than any other proceeding in the Commission's more than a century of operations." Activists argued a giant Exelon conglomerate would fail to devote resources to the city's clean-energy goals, connecting anti-monopolization with fighting climate change.

There are a lot of reasons for runaway monopolies: an intellectual hijacking by Chicago-school conservative economists, the over-financialization of the economy, a failure of federal antitrust enforcement. But perhaps the biggest reason is that antitrust policy has become divorced from politics, confined to specialized lawyers and mathematicians instead of citizens and activists. Without grassroots momentum, politicians and enforcement agencies can safely ignore the issue. That's the challenge for a small band of academics, think-tank fellows, and activists: to make monopolies a vital issue again, connecting with the severe economic anxiety Americans feel.

"In 2016, I hope that there's 20 candidates running on an anti-monopoly platform, making it the heart of their campaign," Teachout says. "It's important to not believe that our current pathological capitalism is the only kind you can have. We can have a version of capitalism that's not this concentrated."