Antitrust reform has emerged as an issue of bipartisan concern in Washington, as leaders of both parties have expressed dismay over growing industrial concentration, particularly in high-tech, but experts say investors should pay less attention to what it is happening in a Congress distracted by debates about COVID relief. and impeachment and look up regulatory agencies like the Federal Trade Commission to learn how competition policy can affect the bottom line of some of America’s largest corporations.
Democratic Sen. Amy Klobuchar of Minnesota launched a bold new pro-competition bill in the Senate last week that would increase funding for antitrust enforcement officials, place the burden of proof that a potential A merger would not be anti-competitive for the companies themselves and would force the courts to broaden their definition of anti-competitive outcomes. However, some Republican co-sponsors were missing from the legislation. That “suggests the bill faces a strong chance of being passed in its entirety by the Senate as long as the filibuster continues,” wrote Steve Pavlick, policy chief at Renaissance Macro Research and former deputy assistant secretary for legislative affairs at the administration’s Treasury Trump. Department, in a note to customers on Wednesday. Republicans’ reluctance to accept Klobuchar’s proposal is likely due in part to the fact that any major change in the US antitrust apparatus would have implications that go far beyond major tech firms like Facebook Inc. FB, -0.45% Twitter Inc. TWTR, + 4.64% and Alphabet Inc., GOOG, parent of Google, -0.19%, which have become popular targets among conservatives due to perceived political biases. “It‘s difficult to get 60 votes in the Senate for any piece of legislation, let alone something on an issue like antitrust that has technical legal substance and broad impact across the country,” Robert Kaminsky, policy analyst at Capital Alpha, told MarketWatch. Partners. However, there remains a growing bipartisan consensus that the US economy has a monopoly problem. Last fall, Republicans on the House Antitrust Subcommittee backed some of the findings of their fellow Democrats in a review of monopoly power in the tech industry. Republican Rep. Ken Buck said on Twitter last week that “I will introduce legislation that curbs anti-competitive behavior by big tech,” while Republican Sen. Josh Hawley of Missouri and Sen. Mike Lee of Utah have endorsed stronger antitrust enforcement. . While this rhetoric has so far not prompted Republicans to take serious legislative action, it could provide the political cover for the Federal Trade Commission to redefine its relationship with competition policy, according to Alex Cynamon of Veda Partners. “There is a level of bipartisan support that should embolden the Biden administration to undertake regulatory and compliance actions that address competition policy and that may even focus on the technology sector,” he said. President Biden has yet to select nominees for the two vacant seats on the Federal Trade Commission, but reports indicate he is leaning toward appointing Columbia Law Professor Lina Kahn, a longtime critic of the monopoly power of the great technologies, to fill one of the positions. Kahn co-authored an article last year with FTC Commissioner Rohit Chopra, whom Biden nominated to head the Office of Consumer Financial Protection, which advocates reviving the latent powers of the FTC to force behavioral changes in companies. largest US corporations that you consider anti-competitive. The FTC, for example, could get involved in crafting rules that prevent practices such as self-referencing, whereby companies like Google and Amazon.com Inc. AMZN, -0.26% allegedly use their platforms to promote their own products over those of the competition or the use of non-competition agreements to suppress wages, as current FTC Acting Director Rebecca Kelly Slaughter has endorsed. Cynamon predicts that while bipartisan legislation is unlikely to become law during this Congress, it is still the most likely high-profile issue that Democrats and Republicans could successfully address, although any new law likely would not be as comprehensive as they would. Democrats would like it. . But even a bill to simply increase funding for the FTC and the Department of Justice, along with aggressive leadership, could go a long way toward preventing further consolidation in the marketplace, according to former deputy attorney general William Baer. of antitrust matters during the Obama presidency. Klobuchar and Sen. Chuck Grassley of Iowa, the highest-ranking Republican on the Senate Judiciary Committee, have already teamed up to introduce legislation to do just that. “More funding would make a substantial difference given the number of issues that are being investigated by both antitrust agencies,” he told MarketWatch. “This requires people, money and consultants, and without those resources, the substantive law changes would have limited effect.”