By David A. Perez
As President Donald Trump takes the helm of the executive branch of the federal government, many are asking how he will approach antitrust regulation.
Conventional wisdom holds that Republicans are more amenable to mergers, even large ones, than Democrats. During the second Bush Administration, competition enforcement was relatively lax, mergers were routinely approved without conditions, and litigation was rare and often unsuccessful (the government successfully litigated only one merger case during the Bush years). The Bush Administration filed, on average, 16 merger challenges per year — down from an average of 35 per year under President Bill Clinton. As a result, “markets became more and more concentrated as companies merged without a problem.”1
The Obama Administration ramped up enforcement to an average of 21 challenges per year (well above Bush, but significantly below Clinton), and routinely scrutinized and placed conditions on potential mergers. And in contrast to the Bush Administration, Obama’s Antitrust Division of the U.S. Department of Justice did not shy away from litigation. It racked up a series of wins over the past eight years and continued to file suits to block certain proposed mergers over the past few months.
For his part, Trump may be the first incoming president with personal experience dealing with antitrust law, both as a plaintiff (unsuccessfully suing a professional sports league for alleged antitrust violations) and as a defendant (successfully defending against charges of monopolizing casino gambling in Atlantic City). In fact, Trump once was fined $750,000 for allegedly violating the Hart-Scott-Rodino Antitrust Improvements Act by improperly acquiring stock in two gaming companies.
One might think that these experiences would have left a lasting impression on Trump, such that he would have a clearly defined (and predictable) view of antitrust enforcement. But as with most things Trump, it is not that easy to figure out what he actually believes. Trump may be a Republican, but he ran as a populist,2 lambasting elites3 and traditional Republican policies such as free trade.4
To the extent one can divine a thematic approach to Trump’s antitrust policies, two observations stand out: First, Trump is obsessed with the media, but leery of media consolidations; second, he has difficulty focusing on details,5 which means he likely will leave non-media mergers to the bureaucrats he appoints to run his departments and agencies.
So, assessing how the Trump Administration may handle antitrust regulation turns on whether we should focus on his words or on his friends.
Judge a Man by His Words?
Admittedly, Trump’s statements are not always the best gauge of what he actually believes. As a candidate, Trump regularly contradicted himself,6 sometimes within the same sentence.7 While Trump has suggested he would bring a populist vigor to antitrust regulation, cracking down on real (and perceived) concentrations of economic power, much of his campaign rhetoric appears to have focused on companies he personally dislikes,8 particularly those in technology and media.
Trump’s heated rhetoric has led some to suggest that he will try to “weaponize the antitrust laws”9to punish companies or industries he doesn’t like. But perhaps the biggest takeaway from Trump’s campaign is that he views himself as the consummate dealmaker, which means even his most bombastic statements are just opening offers10 — though in most cases, his end game in attacking certain industries or companies is not clear.
Or Judge a Man
by the Company He Keeps?
There is a big difference between the rhetoric that candidate Trump used on the trail and the ideological views of those now running and advising his administration. Many of these appointees are political insiders and conventional Republican powerbrokers.11 These advisors and early appointments may be the best indicators of how Trump’s administration will approach antitrust law.
Indeed, contrary to Trump’s promises to “block” deals or “break up” companies, the president does not decide if a merger or an existing company violates antitrust laws — those decisions must be handled by officials at the Department of Justice and the Federal Trade Commission.
So the “clearest sign”12 of the Trump Administration’s stance on antitrust enforcement will come from “who is appointed to crucial positions at the Justice Department and the Federal Trade Commission.” And on that score, it appears that Trump’s policies may fall along traditional Republican ideology, i.e., a return to the Bush years of less aggressive enforcement overall.13
For instance, Sen. Jeff Sessions (R-Ala.), Trump’s pick to be attorney general, has a long track record of supporting mergers. As one analyst has put it, “Sessions as attorney general would shift immediately from the current mostly ‘red light’ Obama antitrust/competition policy and move towards one that would be friendlier to M&A activity.”14
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