The politics of antitrust in the United States: Public choice and public choices

University of Pittsburgh Law Review

Volumn 62, Issue 3, 2001, Pages 475-500

  Foer, Albert A ^a  

^a NONE

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EID: 0035612764     PISSN: 00419915     EISSN: None     Source Type: Journal    
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References (77)

1. Who is Sherwood Anderson? Why should he pay any attention to his statement?
2. Holman W. Jenkins, Jr., All Wires Lead to Washington, WALL ST. J., July 5, 2000, at A23.
3. The Journal's reportorial coverage of antitrust issues tends to be neutral and objective, displaying little of the ideological coloring of the editorial section.
4. Review and Outlook: Public Power, WALL ST. J., July 24, 2000, at A26.
5. Id.
6. Public choice is a label that can be misleading. The central premise of public choice analysis is that "political actors are just like everyone else; . . . they should be viewed as rational individuals who act in self-interest." STEPHEN J.K. WALTERS, ENTERPRISE, GOVERNMENT AND THE PUBLIC 86 (McGraw-Hill, 1993). According to this theory, when government makes choices for the public, the choices will in reality be made by individuals acting in their self-interest, and not in some selfless public interest. See THE CAUSES AND CONSEQUENCES OF ANTITRUST: THE PUBLIC-CHOICE PERSPECTIVE (Fred S. McChesney & William F. Shughart II eds., Univ. of Chicago Press, 1995).
7. Public choice is a label that can be misleading. The central premise of public choice analysis is that "political actors are just like everyone else; . . . they should be viewed as rational individuals who act in self-interest." STEPHEN J.K. WALTERS, ENTERPRISE, GOVERNMENT AND THE PUBLIC 86 (McGraw- Hill, 1993). According to this theory, when government makes choices for the public, the choices will in reality be made by individuals acting in their self-interest, and not in some selfless public interest. See THE CAUSES AND CONSEQUENCES OF ANTITRUST: THE PUBLIC-CHOICE PERSPECTIVE (Fred S. McChesney & William F. Shughart II eds., Univ. of Chicago Press, 1995).
8. Jenkins, supra note 2, at A23.
9. Id.
10. Donald I. Baker, Antitrust and Politics at the Justice Department, 9 J.L. & POL. 291, 291 (Winter 1993). Or as Robert Pitofsky, the current Chairman of the Federal Trade Commission, wrote in 1979: "It is bad history, bad policy, and bad law to exclude certain political values in interpreting the antitrust laws." Robert Pitofsky, The Political Content of Antitrust, 127 U. PA. L. REV. 1051 (1979).
11. Donald I. Baker, Antitrust and Politics at the Justice Department, 9 J.L. & POL. 291, 291 (Winter 1993). Or as Robert Pitofsky, the current Chairman of the Federal Trade Commission, wrote in 1979: "It is bad history, bad policy, and bad law to exclude certain political values in interpreting the antitrust laws." Robert Pitofsky, The Political Content of Antitrust, 127 U. PA. L. REV. 1051 (1979).
12. It is useful to distinguish between narrowly political motives (e.g., to make decisions on the basis of their capacity for generating immediate political support) and ideological political motives (e.g., to protect small businesses or punish large corporations on the basis of their size, or to pursue efficiency as the sole objective of antitrust). The former seems reprehensible unless the decision is firmly supported in law and economics. The latter seems reprehensible if it ignores the law.
13. See William J. Baer & David A. Balto, The Politics of Federal Antitrust Enforcement, 23 HARV. J.L. & PUB. POL'Y 113 (1999): "[T]here is little credible evidence that politics drives enforcement."
14. The Justice Department's consent decree in a conglomerate merger case became part of the Watergate scandal when evidence came out that ITT had sought covertly to persuade Assistant Attorney General McLaren and the White House to drop the ITT prosecutions. See Baker, supra note 9, at 295. The definitive link in the alleged payoff was never proved, according to CHARLES R. GEISST, MONOPOLIES IN AMERICA 229 (2000). "The ITT affair, including Attorney General Kleindienst's misdemeanor conviction for misleading the Judiciary Committee about the secret settlement negotiations, inspired Congress to pass legislation requiring the publication of consent decrees, court findings, and other relevant documents sixty days prior to the effective date of the judgment." RUDOLPH J.R. PERITZ, COMPETITION POLICY IN AMERICA, 1888-1992, 345 n.2 (1996).
15. The Justice Department's consent decree in a conglomerate merger case became part of the Watergate scandal when evidence came out that ITT had sought covertly to persuade Assistant Attorney General McLaren and the White House to drop the ITT prosecutions. See Baker, supra note 9, at 295. The definitive link in the alleged payoff was never proved, according to CHARLES R. GEISST, MONOPOLIES IN AMERICA 229 (2000). "The ITT affair, including Attorney General Kleindienst's misdemeanor conviction for misleading the Judiciary Committee about the secret settlement negotiations, inspired Congress to pass legislation requiring the publication of consent decrees, court findings, and other relevant documents sixty days prior to the effective date of the judgment." RUDOLPH J.R. PERITZ, COMPETITION POLICY IN AMERICA, 1888-1992, 345 n.2 (1996).
16. The Justice Department's consent decree in a conglomerate merger case became part of the Watergate scandal when evidence came out that ITT had sought covertly to persuade Assistant Attorney General McLaren and the White House to drop the ITT prosecutions. See Baker, supra note 9, at 295. The definitive link in the alleged payoff was never proved, according to CHARLES R. GEISST, MONOPOLIES IN AMERICA 229 (2000). "The ITT affair, including Attorney General Kleindienst's misdemeanor conviction for misleading the Judiciary Committee about the secret settlement negotiations, inspired Congress to pass legislation requiring the publication of consent decrees, court findings, and other relevant documents sixty days prior to the effective date of the judgment." RUDOLPH J.R. PERITZ, COMPETITION POLICY IN AMERICA, 1888-1992, 345 n.2 (1996).
17. See Albert A. Foer, On Political Interference and the Microsoft Case, FTC: WATCH (Apr. 7, 2000), available at http://www.antitrustinstitute.org/recent/62.cfm.
18. "The rules of antitrust law constitute legal commands with a political content, not unlike the rules that comprise the Constitution." SCOTT R. BOWMAN, THE MODERN CORPORATION AND AMERICAN POLITICALTHOUGHT 168 (1996). Bowman continues By "political," I mean that it is an evolving product of political and social forces, shaped from the outset by ideological interpretations of the appropriate relationship between government and the market, and that its subject matter, the regulation of corporate power, is primarily a political matter in the constitutional sense, insofar as the proper scope of that power becomes a subject of litigation. Id. at 168-69.
19. See KENNETH CULP DAVIS, DISCRETIONARY JUSTICE, A PRELIMINARY INQUIRY (1971).
20. "[C]onsistency and predictability of enforcement help insulate the agencies from political pressure. Agency decisions are now more transparent. If an agency initiated an action inconsistent with the Guidelines or other enforcement actions, it would immediately be subjected to countervailing pressures from the press and the public. In addition, the current practice of following previously published and widely disseminated policies provides another layer of support for those policies." Baer & Balto, supra note 11, at 125.
21. MICHAEL PERTSCHUK, REVOLT AGAINST REGULATION (1982).
22. A law enforcer has a certain amount of capital (e.g., personal time, available staff, funding for outside research, general goodwill, favors to call in, etc.) that is limited and therefore must be expended with care. Public choice theorists, who see all people as "economic man," should have no trouble with this depiction.
23. The House of Representatives Judiciary Committee no longer has an antitrust subcommittee. The Chair and Ranking Minority member are the de facto antitrust subcommittee.
24. See Baker, supra note 9, at 295, which provides an example involving a congressional reversal of a divestiture decision made by the Antitrust Division in the context of a rail merger in the mid-1980s. The Soft Drink Interbrand Competition Act, 15 U.S.C. § 3501 (1980), is an example of legislation that overturns an antitrust enforcement policy that was unacceptable to Congress.
25. The author recently participated in Senate Commerce Committee hearings about an important pending airline merger under Justice Department investigation. Virtually every Member voiced an opinion about the merger's deficiencies, and senior Members introduced a resolution denouncing the merger. While activity amounts to political interference, in that these politicians have clearly conveyed to the Justice Department how they perceive the public interest on a pending matter, the process was on the record in the public light, and no threats or promises were explicitly conveyed. The author believes that Members with strong opinions on a matter of this sort have every right and responsibility to state their opinions, so long as antitrust enforcers are expected to make their decisions on the basis of professional expertise and objective analysis.
26. In 1983, Reagan's Antitrust Division drafted an amicus brief in the Supreme Court case of Monsanto Co. v. Spray-Rite Service Corp., 465 U.S. 752 (1984), in which it argued that resale price maintenance should no longer be considered per se illegal. After the brief was submitted but prior to oral argument, Congress enacted appropriations legislation that provided: "None of the funds appropriated . . . may be used for any activity the purpose of which is to overturn or alter the per se prohibition on resale price maintenance in effect under Federal antitrust laws." Pub. L. No. 98-166, § 510, 97 Stat. 1102 (1983). See also Frederick R. Warren-Boulton, Resale Price Maintenance Reexamined: Monsanto v. Spray-Rite (1984), in THE ANTITRUST REVOLUTION 377 (John E. Kwoka, Jr. & Lawrence J. White eds., 3d ed. 1989). During oral argument before the Supreme Court, Justice O'Connor ended Assistant Attorney General Baxter's oral argument by wryly asking, "Mr. Baxter, had Congress not adopted the proviso in its appropriation act, would you have made possibly a different argument to us today?" Baxter responded, "We have not withdrawn part 2(b) of our brief, Justice O'Connor. Beyond that I would prefer not to deal with that question." 1983 U.S. Trans. LEXIS 18, at 21 (cited in STEPHEN CALKINS, 68 ANTITRUST L.J. 625 (2001)). Following FTC v. Butterworth Health Corp., 946 F. Supp. 1285 (W.D. Mich. 1996), aff'd, 121 F.3d 708 (6th Cir. 1997) (per curiam), the FTC decided not to seek certiorari with respect to a district court's decision against issuing an injunction. Press reports speculated that the Commission acted in response to Congressional pressure: It didn't help the federal government's case that Amway, one of the city's [i.e., where the two hospitals were merging] largest employers, stood firmly behind the merger. Amway's retired cofounder Richard De Vos, also former Chairman of the Board at Butterworth, reportedly played a key role in the creation of a Senate appropriations rider that, if enacted, would have prohibited the Federal Trade Commission from continuing to challenge the merger. See Stephen Calkins, In Praise of Antitrust Litigation: The Second Annual Bernstein Lecture, 72 ST. JOHN'S L. REV. 1, 11 n.41 (1998).
27. In 1983, Reagan's Antitrust Division drafted an amicus brief in the Supreme Court case of Monsanto Co. v. Spray-Rite Service Corp., 465 U.S. 752 (1984), in which it argued that resale price maintenance should no longer be considered per se illegal. After the brief was submitted but prior to oral argument, Congress enacted appropriations legislation that provided: "None of the funds appropriated . . . may be used for any activity the purpose of which is to overturn or alter the per se prohibition on resale price maintenance in effect under Federal antitrust laws." Pub. L. No. 98-166, § 510, 97 Stat. 1102 (1983). See also Frederick R. Warren-Boulton, Resale Price Maintenance Reexamined: Monsanto v. Spray-Rite (1984), in THE ANTITRUST REVOLUTION 377 (John E. Kwoka, Jr. & Lawrence J. White eds., 3d ed. 1989). During oral argument before the Supreme Court, Justice O'Connor ended Assistant Attorney General Baxter's oral argument by wryly asking, "Mr. Baxter, had Congress not adopted the proviso in its appropriation act, would you have made possibly a different argument to us today?" Baxter responded, "We have not withdrawn part 2(b) of our brief, Justice O'Connor. Beyond that I would prefer not to deal with that question." 1983 U.S. Trans. LEXIS 18, at 21 (cited in STEPHEN CALKINS, 68 ANTITRUST L.J. 625 (2001)). Following FTC v. Butterworth Health Corp., 946 F. Supp. 1285 (W.D. Mich. 1996), aff'd, 121 F.3d 708 (6th Cir. 1997) (per curiam), the FTC decided not to seek certiorari with respect to a district court's decision against issuing an injunction. Press reports speculated that the Commission acted in response to Congressional pressure: It didn't help the federal government's case that Amway, one of the city's [i.e., where the two hospitals were merging] largest employers, stood firmly behind the merger. Amway's retired cofounder Richard De Vos, also former Chairman of the Board at Butterworth, reportedly played a key role in the creation of a Senate appropriations rider that, if enacted, would have prohibited the Federal Trade Commission from continuing to challenge the merger. See Stephen Calkins, In Praise of Antitrust Litigation: The Second Annual Bernstein Lecture, 72 ST. JOHN'S L. REV. 1, 11 n.41 (1998).
28. In 1983, Reagan's Antitrust Division drafted an amicus brief in the Supreme Court case of Monsanto Co. v. Spray-Rite Service Corp., 465 U.S. 752 (1984), in which it argued that resale price maintenance should no longer be considered per se illegal. After the brief was submitted but prior to oral argument, Congress enacted appropriations legislation that provided: "None of the funds appropriated . . . may be used for any activity the purpose of which is to overturn or alter the per se prohibition on resale price maintenance in effect under Federal antitrust laws." Pub. L. No. 98-166, § 510, 97 Stat. 1102 (1983). See also Frederick R. Warren-Boulton, Resale Price Maintenance Reexamined: Monsanto v. Spray-Rite (1984), in THE ANTITRUST REVOLUTION 377 (John E. Kwoka, Jr. & Lawrence J. White eds., 3d ed. 1989). During oral argument before the Supreme Court, Justice O'Connor ended Assistant Attorney General Baxter's oral argument by wryly asking, "Mr. Baxter, had Congress not adopted the proviso in its appropriation act, would you have made possibly a different argument to us today?" Baxter responded, "We have not withdrawn part 2(b) of our brief, Justice O'Connor. Beyond that I would prefer not to deal with that question." 1983 U.S. Trans. LEXIS 18, at 21 (cited in STEPHEN CALKINS, 68 ANTITRUST L.J. 625 (2001)). Following FTC v. Butterworth Health Corp., 946 F. Supp. 1285 (W.D. Mich. 1996), aff'd, 121 F.3d 708 (6th Cir. 1997) (per curiam), the FTC decided not to seek certiorari with respect to a district court's decision against issuing an injunction. Press reports speculated that the Commission acted in response to Congressional pressure: It didn't help the federal government's case that Amway, one of the city's [i.e., where the two hospitals were merging] largest employers, stood firmly behind the merger. Amway's retired cofounder Richard De Vos, also former Chairman of the Board at Butterworth, reportedly played a key role in the creation of a Senate appropriations rider that, if enacted, would have prohibited the Federal Trade Commission from continuing to challenge the merger. See Stephen Calkins, In Praise of Antitrust Litigation: The Second Annual Bernstein Lecture, 72 ST. JOHN'S L. REV. 1, 11 n.41 (1998).
29. Watergate documents shed light on Nixon's views on the antitrust suits [involving ITT] in progress at the time, brought by [Assistant Attorney General] McLaren. A tape made at the White House in 1971 recorded Nixon as saying to Richard Kleindienst, who had been designated to succeed John Mitchell as attorney general, 'I do not want McLaren to run around prosecuting people, raising hell about conglomerates, stirring things up at this point. Now you keep him the hell out of that . . . or either he resigns. I'd rather have him out anyway. I don't like the son of a bitch.' (McLaren left the Antitrust Division later in 1971 and took a job as a federal judge shortly thereafter.) GEISST, supra note 12. Under the Clinton Administration, an internal White House policy prohibits conversation between White House personnel and FTC/DOJ (or other regulatory) personnel regarding a case in which the rights of specific parties are involved, except in special circumstances in which communications are by White House Counsel. Telephone interview with Paul Oetken, Associate Counsel to the President (Nov. 13, 2000).
30. In Humphrey's Executor v. United States, 295 U.S. 602 (1935), the Supreme Court held that the Congress, in establishing the FTC, intended to confer independence from the President, and that the FTC was the agent of Congress and the judiciary, not of the executive. The President lacked the authority to remove an FTC Commissioner from office because of divergent policy views, although the President could remove the Chairmanship from a Commissioner, as typically happens with a change in administration.
31. This is not a new thought. The poet of Beowulf wrote, "Behavior that's admired is the path to power among people everywhere." BEOWULF 5 lines 24-25 (Seamus Heaney, trans., Farrar, Straus & Giroux, 2000).
32. An exception occurred when the Reagan administration took office. The strong anti-regulation ideology that drove the administration carried a large and undisguised distrust of the career bureaucracy. See, e.g., MARC ALLEN EISNER, ANTITRUST, THE TRIUMPH OF ECONOMICS (1991).
33. See Richard Wolffe, Microsoft's Ticking Clock. Windows 2001, THE NEW REPUBLIC 18, June 19, 2000, at 18: When Klein and his staff pack up their papers at the end of the Clinton administration as expected, the landmark case will be far from over, since the appeals process could drag on for years. And if W. [Gov. Bush] wins in November, there's every sign he would appoint a Justice Department ideologically opposed to pursuing the case against Microsoft.
34. It is commonly believed that a new administration can undertake difficult and unpopular decisions, since they are likely to be forgotten four years later.
35. Antitrust cases, especially those having political salience, tend to be large and lumbering, such that it is often very difficult for enforcers to attune the timing of major events to political expediency.
36. In George Stigler's theory of economic regulation, special interests often prevail in the political marketplace not only because they have the most at stake, but because they have information and organization cost benefits over the majority. George J. Stigler, The Theory of Economic Regulation, BELL J. OF ECON. & MGMT. SCI. 2, Spring 1971. In the politics of the Microsoft case, it was helpful political cover for the Democrat-controlled Justice Department to have an ally in Senator Orrin Hatch, Chairman of the Judiciary Committee (whose constituency happened to include a major software company that competes against Microsoft).
37. "There is political support for both sides in almost every antitrust case, thus diluting the public choice argument that politics drives enforcement decisions." Baer & Balto, supra note 11, at 129.
38. It has recently come to light that American Express assisted the Antitrust Division in formulating its case against Visa and MasterCard, which are alleged to have prevented banks from issuing American Express cards.
39. Albert A. Foer, What About the Issue? Presidential Candidates Have Told Us Too Little About Their Antitrust Policy, THE LEGAL TIMES, Apr. 3, 2000, available at http://www. antitrustinstitute.org/recent/61.cfm.
40. Journalists have not yet self-identified as an "antitrust trade press." Until the Microsoft case began to generate a cadre of expert reporters, few journalists knew much about antitrust and even fewer held what could be called an "antitrust beat." Usually, when there is an antitrust story to cover, the journalist is one who is a "legal" reporter, a "business" reporter, or perhaps a "high tech" reporter. See David Lawsky, Microsoft and the Making of a New Antitrust Press Corps, 13 ANTITRUST 52 (Spring 1999).
41. When one large corporation sues another for antitrust violations, both are likely to retain attorneys in large law firms. When a small business or a class initiates an antitrust suit, the attorney more typically is employed by a specialized plaintiffs' firm.
42. With the procedural, theoretical, and remedial details of the antitrust laws, plaintiffs' attorneys, typically paid by contingency fees, have more at stake personally than defense lawyers who are usually paid on an hourly basis. Statutes and court-made law involving standing, treble damages, and the minimal showing necessary to overcome a motion for summary judgment, for instance, can determine whether it is profitable to represent a potential antitrust client. This is not strictly a matter of self-interest, however, in that it is part of the American antitrust system to include a large role for private enforcement of the antitrust law. (In most years, private antitrust actions outnumber federal actions by about ten-to-one.)
43. http://www.antitrustinstitute.org/about.cfm.
44. Albert A. Foer, Small Business and Antitrust: Why the Little Guys Left the Fold and Why They Should Return (Jan. 21, 2000), available at http://www.antitrustinstitute.org/recent/51.cfm. From the perspective of small business, the following reasons and perceptions appear to account for political indifference to antitrust on the part of the associations representing small businesses: • The FTC lacks enthusiasm for [the Robinson-Patman anti-discrimination law] and is viewed as ignoring its potential authority to deal with price discrimination and buyer power. This permits large players to bully smaller ones without worrying about legal consequences. • The antitrust agencies support "efficiency" over "level playing field" fairness and spout the mantra that "antitrust is about protecting competition rather than protecting competitors." Far from believing that "big is bad," the enforcement agencies have adopted a mindset that favors big business. For example, they tend to permit most vertical restraints by manufacturers that limit the flexibility of downstream small businesses. • Under the influence of the "Chicago School," not to mention the Supreme Court, the agencies rarely pursue predatory pricing cases that can keep dominant firms from destroying smaller competitors. • An "Exit Strategy Mentality" has evolved within the small business community, leading small businesses to favor non-interventionist policies toward mergers and acquisitions. • Consolidation of industries has changed the structure of small business trade associations, giving large firms veto power over their agendas. • There has been a communications failure on the part of antitrust's supporters. Small businesses do not understand the objective importance of antitrust, even as practiced today, for their strategic well-being. Id. at 6-7.
45. What has emerged is a highly technical conversation between experts that use a special language so complex that an attempt to join the closed community of antitrust expertise has such high transaction costs that most do not try or become part of the status quo if they are able to master the language of antitrust. . . . As a result, the courts and Congress no longer play a dominant role in setting either law or policy for this vitally important aspect of political economy. Spencer Weber Waller, Prosecution by Regulation: The Changing Nature of Antitrust Enforcement, 77 OR. L. REV. 1383, 1429-30 (1998).
46. And our discussion is not personal, either, although it should be disclosed that the American Antitrust Institute awarded its 2000 "Level Playing Field" award for antitrust achievement to Joel Klein. Klein resigned from office at the end of September, 2000, after approximately five years in the Antitrust Division - three as head, two as deputy head. Klein came to the Division from a position as deputy counsel to the President. As of this writing, he has not made known his next career plans.
47. See W. John Moore, The Hottest Lawyer in Town, NAT'L J. 2312 (July 15, 2000): "Klein's performance at the Justice Department has collected rave reviews, so look for him to become one of the most highly recruited Clinton Administration officials ever."
48. Reputation is an important component of an antitrust professional's economic value in the private sector. Jonathan Baker, former head of the FTC's Bureau of Economics and now a professor and sometime consultant in antitrust litigation, pointed out that government antitrust officials often make speeches and publish articles that box them in during a later career. Consistency is thus a substantial aspect of reputation. Public choice theory should not predict that an official will be overly aggressive while in office, since such behavior will create inconsistencies that may limit pay-off in private practice. Paradoxically, "selling out" while in office will also undermine one's reputation, and hence one's future value in the private sector.
49. Norman W. Hawker has suggested that it is odious to criticize government employees for doing what they were hired to do. Indeed, he says the strong form of price theory that supports public choice and Chicago theory also prizes "self-interest" by private firms as the mechanism to promote the public interest. Why should not this be equally true for law enforcement (i.e., Klein's self-interest leads him to enforce the antitrust laws which serves the public interest in having the antitrust laws enforced)?
50. Part of this section appeared in the author's book review of FRED S. MCCHESNEY, MONEY FOR NOTHING: POLITICIANS, RENT EXTRACTION, AND POLITICAL EXTORTION (1997), that appeared in WHITE HOUSE WEEKLY (Feb. 3, 1998), available at http://www.antitrustinstitute.org/recent/1.cfm.
51. Part of this section appeared in the author's book review of FRED S. MCCHESNEY, MONEY FOR NOTHING: POLITICIANS, RENT EXTRACTION, AND POLITICAL EXTORTION (1997), that appeared in WHITE HOUSE WEEKLY (Feb. 3, 1998), available at http://www.antitrustinstitute.org/recent/1.cfm.
52. Stigler, supra note 30. Stigler built on literature showing how agencies can be captured by private interests that have the most to gain or lose. See, e.g., MARVER BERNSTEIN, REGULATING BUSINESS BY INDEPENDENT COMMISSION (1955) and MANCUR OLSEN, THE LOGIC OF COLLECTIVE ACTION (1965). Capture theory has been aptly criticized as "not sufficiently well formulated to enable us to predict when capture might occur and to understand all the conditions that might enable it to occur." STEVEN J.K. WALTERS, ENTERPRISE, GOVERNMENT, AND THE PUBLIC 82 (1993).
53. Stigler, supra note 30. Stigler built on literature showing how agencies can be captured by private interests that have the most to gain or lose. See, e.g., MARVER BERNSTEIN, REGULATING BUSINESS BY INDEPENDENT COMMISSION (1955) and MANCUR OLSEN, THE LOGIC OF COLLECTIVE ACTION (1965). Capture theory has been aptly criticized as "not sufficiently well formulated to enable us to predict when capture might occur and to understand all the conditions that might enable it to occur." STEVEN J.K. WALTERS, ENTERPRISE, GOVERNMENT, AND THE PUBLIC 82 (1993).
54. Stigler, supra note 30. Stigler built on literature showing how agencies can be captured by private interests that have the most to gain or lose. See, e.g., MARVER BERNSTEIN, REGULATING BUSINESS BY INDEPENDENT COMMISSION (1955) and MANCUR OLSEN, THE LOGIC OF COLLECTIVE ACTION (1965). Capture theory has been aptly criticized as "not sufficiently well formulated to enable us to predict when capture might occur and to understand all the conditions that might enable it to occur." STEVEN J.K. WALTERS, ENTERPRISE, GOVERNMENT, AND THE PUBLIC 82 (1993).
55. Stigler, supra note 30. Stigler built on literature showing how agencies can be captured by private interests that have the most to gain or lose. See, e.g., MARVER BERNSTEIN, REGULATING BUSINESS BY INDEPENDENT COMMISSION (1955) and MANCUR OLSEN, THE LOGIC OF COLLECTIVE ACTION (1965). Capture theory has been aptly criticized as "not sufficiently well formulated to enable us to predict when capture might occur and to understand all the conditions that might enable it to occur." STEVEN J.K. WALTERS, ENTERPRISE, GOVERNMENT, AND THE PUBLIC 82 (1993).
56. Ironically, as Robert Steiner has pointed out to me, public choice theory and Marxism, both starting with a materialistic concept of human nature, share a common conviction that it is naïve to expect that business can be regulated in the public interest. The Marxists believe that this is impossible because those who control the means of production will control government and hence cannot be effectively regulated by government.
57. Perhaps a recent trend in economics, behavioral economics, will contribute to the undermining of public choice theory. See Cass R. Sunstein, Book Review, THE NEW REPUBLIC (Aug. 7, 2000) (reviewing Truman F. Bewley, Why Wages Don't Fall During a Recession), available at http://www.tnr.com/080700/sunstein080700_print.html (last visited Apr. 19, 2001).
58. Perhaps a recent trend in economics, behavioral economics, will contribute to the undermining of public choice theory. See Cass R. Sunstein, Book Review, THE NEW REPUBLIC (Aug. 7, 2000) (reviewing Truman F. Bewley, Why Wages Don't Fall During a Recession), available at http://www.tnr.com/080700/sunstein080700_print.html (last visited Apr. 19, 2001).
59. MCCHESNEY, supra note 44, at 170.
60. Rep. Henry J. Hyde is a conservative Republican who chairs the committee with jurisdiction over antitrust in the U.S. House of Representatives. He writes: "Antitrust law sustains free markets and dissipates political pressure for government regulation. For that reason, Republicans, and indeed all citizens, should support it wholeheartedly . . . [A]ntitrust law is the antithesis of government regulation . . . Vigorous and intelligent antitrust enforcement is a cornerstone Republican principle." 14 ANTITRUST 82 (Spring 2000).
61. As Stephen Calkins, a former FTC General Counsel, writes: [G]overnmental antitrust agencies should, and do, think long and hard before going to court. In part, this care is simply good government. A court complaint represents a commitment of substantial agency resources. It also imposes costs on the defendant, the judicial system, and third parties; governmental officials should impose such costs with care. Any court complaint can roil the capital markets and prevent companies from engaging in normal activities that might benefit consumers. Governmental agencies also hesitate to litigate because of fear of defeat. Courtroom setbacks can demoralize agency staff, raise questions in the eyes of observers, and impose political costs. Few agency annual reports boast about the well-fought loss, and, in an era in which governmental accountability is fashionable, it is challenging to characterize losses as accomplishments. In Praise of Antitrust Litigation, Calkins, supra note 22, at 1, 5. While some lawyers will argue that winability is a proxy for "the public interest," this position converts the conversation from essential ethical considerations to matters of process and gamesmanship.
62. Section 5 of The Federal Trade Commission Act makes "unfair methods of competition" illegal. 15 U.S.C. § 45(a)(1) (2000).
63. See MARK J. GREEN ET AL., THE CLOSED ENTERPRISE SYSTEM 407-10 (1972).
64. To this footnote is relegated the idea that the public would miss the antitrust laws if all mergers were allowed or if all price fixing were beyond the reach of the law. It seems likely that the public would be demanding the passage of something resembling the Sherman Act long before the predictable effects of having no antitrust law had become reality. This thought experiment is particularly easy to conduct at a time when so many of the world's nations are moving so rapidly to create their own competition policy regimes. See, e.g., DANIEL YERGIN & JOSEPH STANISLAW, THE COMMANDING HEIGHTS: THE BATTLE BETWEEN GOVERNMENT AND THE MARKETPLACE THAT IS REMAKING THE MODERN WORLD (1998). One of the results of the Reagan cutbacks on federal antitrust was the explosion of expanded state antitrust efforts.
65. See, e.g., MARTIN J. SKLAR, THE CORPORATE RECONSTRUCTION OF AMERICAN CAPITALISM, 1890-1916: THE MARKET, THE LAW, AND POLITICS 285-309 (1988).
66. See FTC BUREAU OF COMPETITION, NATIONAL COMPETITION POLICY: HISTORICAL PERSPECTIVES ON ANTITRUST AND GOVERNMENT-BUSINESS RELATIONSHIPS IN THE UNITED STATES (1981); Albert A. Foer & Robert H. Lande, The Evolution of United States Antitrust Law: The Past, Present, and (Possible) Future, 16 NIHON UNIV. COMP. L. 149 (1999), available at http://www.antitrustinstitute.org/recent/64.polf. For a recent popular history, see GEISST, supra note 12, reviewed by Albert A. Foer in the WASH. POST, Aug. 20, 2000, and available at http://www.antitrustinstitute.org/recent/81.cfm.
67. See FTC BUREAU OF COMPETITION, NATIONAL COMPETITION POLICY: HISTORICAL PERSPECTIVES ON ANTITRUST AND GOVERNMENT-BUSINESS RELATIONSHIPS IN THE UNITED STATES (1981); Albert A. Foer & Robert H. Lande, The Evolution of United States Antitrust Law: The Past, Present, and (Possible) Future, 16 NIHON UNIV. COMP. L. 149 (1999), available at http://www.antitrustinstitute.org/recent/64.polf. For a recent popular history, see GEISST, supra note 12, reviewed by Albert A. Foer in the WASH. POST, Aug. 20, 2000, and available at http://www.antitrustinstitute.org/recent/81.cfm.
68. See FTC BUREAU OF COMPETITION, NATIONAL COMPETITION POLICY: HISTORICAL PERSPECTIVES ON ANTITRUST AND GOVERNMENT-BUSINESS RELATIONSHIPS IN THE UNITED STATES (1981); Albert A. Foer & Robert H. Lande, The Evolution of United States Antitrust Law: The Past, Present, and (Possible) Future, 16 NIHON UNIV. COMP. L. 149 (1999), available at http://www.antitrustinstitute.org/recent/64.polf. For a recent popular history, see GEISST, supra note 12, reviewed by Albert A. Foer in the WASH. POST, Aug. 20, 2000, and available at http://www.antitrustinstitute.org/recent/81.cfm.
69. See FTC BUREAU OF COMPETITION, NATIONAL COMPETITION POLICY: HISTORICAL PERSPECTIVES ON ANTITRUST AND GOVERNMENT-BUSINESS RELATIONSHIPS IN THE UNITED STATES (1981); Albert A. Foer & Robert H. Lande, The Evolution of United States Antitrust Law: The Past, Present, and (Possible) Future, 16 NIHON UNIV. COMP. L. 149 (1999), available at http://www.antitrustinstitute.org/recent/64.polf. For a recent popular history, see GEISST, supra note 12, reviewed by Albert A. Foer in the WASH. POST, Aug. 20, 2000, and available at http://www.antitrustinstitute.org/recent/81.cfm.
70. Although the key committee chairs and ranking Members (Senators DeWine and Kohl; Representatives Hyde and Conyers) work well together and are supportive of antitrust activities, "more than a few congressional Republicans oppose vigorous action by federal trustbusters." Kirk Victor & Michael Posner, Merger Mania, NAT'L J., at 2289 (July 15, 2000).
71. Foer, supra note 33.
72. Jaret Sieberg, Bush and Gore Share Views on Antitrust, THE DAILY DEAL (July 12, 2000), available at http://www.thedeal.com (last visited Apr. 18, 2001). Muris singled out three nonmerger cases where he said the Clinton administration overreached; the cases involved Toys R Us (threat to stop selling to price cutter), Intel Corp. (refusal to share technology), and American Airlines (predatory pricing).
73. In what Reuters called Bush's "strongest comment in months on the Clinton administration's antitrust case against Microsoft Corp.," Bush told CNBC on October 19, 2000 that he would not talk about pending cases. Nevertheless, he stated: "I will tell you this, I have always stood on the side of innovation over litigation. I think that some fundamental questions ought to be asked: Are the customers being harmed and is innovation being stifled?" Reuters, Bush Woos MS to Win Washington, WIRED NEWS (Oct. 19, 2000), at http://www.wired.com/news/politics/0,1283,39570,00.html. In a weekly Republican radio address a few days earlier, Senator Slade Gorton (R-Wash) had attacked the Clinton-Gore administration's proposed breakup of Microsoft as "almost too amazing to be true." Associated Press, GOP: Don't Break Up Microsoft, CBS NEWS (Oct. 14, 2000), at http://cbsnews.com/now/story/ 0,1597,241333-412,00.shtml.
74. In what Reuters called Bush's "strongest comment in months on the Clinton administration's antitrust case against Microsoft Corp.," Bush told CNBC on October 19, 2000 that he would not talk about pending cases. Nevertheless, he stated: "I will tell you this, I have always stood on the side of innovation over litigation. I think that some fundamental questions ought to be asked: Are the customers being harmed and is innovation being stifled?" Reuters, Bush Woos MS to Win Washington, WIRED NEWS (Oct. 19, 2000), at http://www.wired.com/news/politics/0,1283,39570,00.html. In a weekly Republican radio address a few days earlier, Senator Slade Gorton (R-Wash) had attacked the Clinton-Gore administration's proposed breakup of Microsoft as "almost too amazing to be true." Associated Press, GOP: Don't Break Up Microsoft, CBS NEWS (Oct. 14, 2000), at http://cbsnews.com/now/story/ 0,1597,241333-412,00.shtml.
75. For example, an Ernst & Young survey of business-to-business (B2B) executives found that 71% of the respondents believe that collusion is a legitimate concern for the FTC. FTC: WATCH, Oct. 23, 2000.
76. See Albert A. Foer, "Baked Lasagne," a paper available at www.antitrustinstitute. org/recent/79.cfm, part of a collection of papers concerning competition policy in the agricultural sector, A FOOD AND AGRICULTURE POLICY FOR THE 21ST CENTURY (Michael C. Stumo ed., 2000), published by the Organization for Competitive Markets and available at http://www.competitivemarkets.com/.
77. Candidate Gore repeatedly attacked big tobacco, big oil, big pharmaceutical, and big HMOs, while candidate Bush talked about trusting the people and having less government. Although neither spoke at the specific level of antitrust policy, their strongly differing rhetoric regarding the role of government and big business would suggest that their administrations would take notably different directions on antitrust.