What Will the Election Mean for Antitrust?

W hen it comes to border enforcement, taxes, and, more generally, “Woke vs. MAGA,” the choice between Donald Trump and Kamala Harris could not be clearer. But when it comes to how the next president will enforce antitrust policy, there are lot of — to borrow a phrase from the late Donald Rumsfeld — known unknowns.

If Harris wins, she will inherit the Biden administration’s radical new framing of antitrust enforcement as a way to fight inflation. The progressive theory is that it was corporate “greedflation” that was a major contributor to raising the prices of staples, not the supply-chain disruption of the pandemic and the continuation of massive government spending when the worst of the crisis had passed. Harris would also inherit an Federal Trade Commission that has jettisoned the consumer-welfare standard — which anchored antitrust enforcement to measurable benefits — and has replaced it with a wide array of vague priorities such as empowering labor, protecting less efficient competitors, and, somehow, combatting racism.

The breadth and vagueness of an overly aggressive redefinition of where antitrust enforcement is appropriate gives regulators such sweeping discretion that, in effect, it puts them on every corporate board. The effect of FTC chairwoman Lina Khan’s tenure is better measured not by its dismal track record in the courts but by the number of possible mergers that the new approach has deterred. It’s not a number that can ever be known, but it seems reasonable to assume that numerous potential mergers have been abandoned at an early stage simply because company boards and managements have decided that the time, cost, and uncertainty involved in fending off an FTC challenge would be too high. “Process” is a very effective way of prohibiting what’s legal. To enable this transition to progressive antitrust, Khan has radically remade her agency, running out seasoned experts in economics and law, often replacing them with progressives drawn from NGOs and academia.

Would a President Harris make progressive antitrust a centerpiece of her administration?

It is easy to imagine that she would. At almost every juncture, Harris leans left even when she can appeal to the center. Harris offers little daylight between herself and most Biden policies. As a presidential candidate, Harris has picked up on the Biden administration’s linkage of inflation to “price-gouging” by businesses. So, wouldn’t a President Harris continue Khan-speed ahead on progressive antitrust?

Maybe. When she was California’s attorney general and, later, a U.S. senator, Harris was not notably radical on antitrust. Even though a President Harris would have a much wider constituency — and could easily leave behind her friends in Silicon Valley — her closeness to many industry leaders indicates that at least she has heard how progressive antitrust hurts innovation and job growth. And if she has forgotten this, Harris’s top soft-money supporters, from billionaire Reid Hoffman to Barry Diller, would remind her. They have not been shy about their wanting Khan (and, presumably, her people) removed from the FTC. Harris is also undoubtedly hearing from liberal economists, such as former Treasury secretary Larry Summers, who have criticized Khan’s progressive antitrust policies as inflationary.

My guess is that a President Harris would continue to swing left on antitrust, but there is enough doubt to mark her down as an “known unknown.” What about Donald Trump?

Trump would no doubt allow a Khan to depart without offering her a second term. As a businessman, Trump’s instincts are naturally pro-growth, so one could see a renewed skepticism of progressive antitrust’s stated ambition to place “a policeman at the elbow” of every business. A Trump administration would likely move for the most part in the direction of traditional antitrust enforcement, judging mergers and acquisitions by their anticipated impact on consumers.

But the former president also brings his share of known unknowns. In his first term, Trump directed the Justice Department to block the AT&T–Time Warner merger. It is widely believed that this was out of anger over what he believed to be unfair coverage at Time Warner’s CNN. Trump also has no love for Big Tech. He might well allow the current antitrust suits against Amazon, Apple, Google, and Meta to continue. It is also worth noting that there are “Khanservatives” on the right. In February, Senator J. D. Vance (not yet, of course, a vice-presidential candidate) referred to Khan’s “doing a pretty good job.”

Despite these misgivings, there is an optimistic case to be made that the next president will bring common sense back to antitrust enforcement. The U.S. economy often seems like a twelve-cylinder engine forced by politicians or regulators to run on four cylinders. We can hope that the next president will realize that overly aggressive antitrust enforcement, whether driven by the ideology or anger, would degrade champions of American innovation, handing the next big thing — likely AI — to China. Let us hope that he or she has the vision to rightsize antitrust in the interest of the nation and U.S. consumers.