The End of the Khan Era

After much conversation, it is now official. Andrew Ferguson is the new chair of the Federal Trade Commission and Lina Khan is not, though she remains until January 31.

A lot has been said and written about the outgoing chair's alleged efforts to ram through a number of controversial complaints and actions during the transition period, so we decided to take a look at FTC actions during another recent transition from one political party to another. We went back, however, to the last time the FTC transitioned from a Democratic chair to a Republican one (when President Donald Trump was first elected to office in 2016) rather than the transition from a Republican chair to a Democratic one (when former President Joe Biden took office) on the theory that possible partisan divides are more likely visible in a transition from D's to R's.

What we found is that, not surprisingly, during a presidential transition, the FTC doesn't simply stop doing anything and also doesn't stop doing anything that isn't bipartisan, but former Chair Khan's Commission certainly brought more partisan enforcement actions during the transition and engaged in far more partisan"policymaking" during the transition period.

Back in November 2016, Edith Ramirez was the chair of the FTC. She was joined by another Democrat and one Republican, and there were two vacancies. During the period from Nov. 9, 2016, to Jan. 20, 2017, the FTC brought 16 consumer protection cases and four competition cases that were unanimous. Three consumer protection cases and one competition case drew dissents from the sole Republican on the Commission. With respect to policymaking, the Ramirez Commission updated two guidelines and issued one Enforcement Policy Statement, all unanimously.

So how does the Khan Commission compare? First some caveats, as things are more complicated this time around. First, the two R's sometimes dissented simply on procedural grounds without indicating whether they disagreed on the merits or just disagreed with the Commission acting so close to a transfer of power. Second, this time around there were a number of instances where the R's dissented in part from the filing of a complaint and also instances where one R dissented and the other agreed (which wasn't possible back in 2016). With one exception, we counted partial concurrences as agreement and we've noted the others. There were also allegations that cases were rushed out the door, but that's hard to assess from the outside.

There were 18 complaints on the consumer protection side and four on the competition side that were unanimous in whole or in large part. Two consumer protection cases and four competition cases drew dissents, with one consumer protection case drawing "abstentions" from the R's. Unlike in 2016, most of these were in the waning days of the Khan FTC, which perhaps is what led to allegations of rushing cases out the door.

The difference is perhaps more striking on the policymaking side. Here the Khan Commission finalized one rule, with one dissent; issued a proposed rule, with the R's criticizing the timing; amended a rule unanimously; issued a guideline, with the R's criticizing the timing; withdrew a guideline, with the R's dissenting; and issued a Policy Statement, with the R's criticizing the timing. Essentially the R's attitude toward this flurry of policymaking was: What's the point of telling people what you think about something when you will no longer have the power to make people do as you say? And there's probably some sense to that.

There is a saying that what goes around comes around. We will, at some point, transition again from one political party to another. Does the more partisan nature of the FTC's transition this time around foreshadow transitions to come? Time will tell.