On December 6, 2017, Senator Elizabeth Warren sharply criticized the state of antitrust enforcement in a speech at the Open Markets Institute.
She said that antitrust enforcers adopted the Chicago School principles, which narrowed the scope of the antitrust laws and allowed mega-mergers to proceed resulting in many concentrated industries. She believes that antitrust enforcers already have the tools to reduce concentrated markets and that they simply must start enforcing the law again.
Senator Warren’s recommendations included stronger merger enforcement, cracking down on anticompetitive conduct and increasing agency involvement in defending competition.
Senator Warren called for the blocking of mergers instead of negotiating weak settlements that allow deals to go through:
- The DOJ and the FTC need to block any mergers that “choke off competition” and take to court any large company that is impeding competition and innovation.
- “If we’re going to begin a new era of antitrust enforcement, we need to demand a new breed of antitrust enforcers. We need enforcers with steel spines who will stand up to companies with the best-dressed lobbyists, the craftiest lawyers, and the highest-paid economists. Enforcers who will turn down papier-mache settlement agreements and actually take cases to court.”
- “To revive competition in our economy, vertical mergers, particularly mergers in already concentrated industries, should be viewed with the same critical eye that’s needed for mergers between direct competitors.”
Senator Warren called for a crack down on anticompetitive conduct:
- The DOJ and FTC should bring lawsuits against companies using anti-poaching and non-competition agreements among companies and franchises that prevent employees from obtaining jobs that could increase their pay.
- The DOJ and FTC need to “[g]row a spine and enforce the law. No-poach agreements are a reminder that corporate concentration not only affects consumers by limiting choices and driving up prices. It also affects workers who can’t get the salary they would be able to get in a competitive economy. It’s time to hold those corporations accountable for these competition-killing practices. And let’s be clear: holding everyone accountable means everyone….There is no exception in antitrust laws for big tech.”
Senator Warren called for all government agencies to participate in the protection of competition:
- “Sure, DoJ is law-enforcer-in-chief, but all government agencies should defend competition” and reduce monopoly power where they have the power to do so. The FCC should enforce strong net neutrality rules. The FDA can reign in pharmaceutical monopolies as it controls which drugs come to market and when. The Federal Reserve and FDIC could make sure that banks are not to big to fail. The DOD could inject more competition in its defense contracting process by not limiting the number of bidders.
In summary, according to Senator Warren, antitrust enforcement is the key to fighting corporate power and reducing big companies control over their industry and politics. Over the past forty years, the antitrust enforcers embraced a less aggressive approach to antitrust enforcement, allowing huge companies to buy up competitors, expand their reach across complementary product lines, and “duck and dodge rules that they don’t like.” Senator Warren is calling for antitrust enforcers to reverse this lax enforcement trend and demands “that antitrust enforcers pick up those tools, dust them off, and start enforcing the law again”.