Antitrust in a Second Trump Term: Six Challenges Facing the New Administration

With the election of former President Trump as the 47th President of the United States, a new group of enforcers will soon take the helm at both the Department of Justice (DOJ) and Federal Trade Commission (FTC) amidst a crucial time for U.S. antitrust policy. After four years of the Biden administration's embrace of the neo-Brandeisian movement, which has sought to radically transform U.S. antitrust law by waging lawfare against corporate America, a second Trump administration has a unique opportunity to chart a better course. But whether it will remains unclear: As ITIF has explained, so-called "Khanservatives," including Vice President-elect J.D. Vance, have expressed sympathy for aspects of the neo-Brandeisian agenda and may play a key role in formulating the incoming administration's competition policy. However, regardless of the direction its antitrust agenda may take, there are several realities a second Trump administration will have to meet head-on if it is to govern effectively.

1. Neo-Brandeisianism Was Not a Winner at the Ballot Box

Several pundits expressed hope that the neo-Brandeisian antitrust program could help turn out blue-collar voters for Democrats. For example, some commentators close to the neo-Brandeisians argued there might be antitrust voters in swing states who would support Democrats who have been active supporters of Chair Khan's agenda. Indeed, Chair Khan even hit the campaign trail for several prominent Democrats, including Senator Bernie Sanders and Congresswoman Alexandria Ocasio-Cortez. But the idea of neo-Brandeisian antitrust as a political winner was always flawed: Given voters' persistent concerns about inflation, an antitrust philosophy based on moving away from a consumer welfare standard and promoting low prices was plainly out of touch. In the words of Professor Hovenkamp, "a neo-Brandeis approach whose goals were honestly communicated could never win an electoral market, just as it has never won in traditional markets." What's more, more than half of American voters who work in the private sector work for large companies, making it far from obvious that imposing costs on their employers was an unambiguously shrewd political strategy.

2. A Climate of Uncertainty

A central tactic of the neo-Brandeisians was the repealing of longstanding agency guidance documents that not only have facilitated sound antitrust enforcement but also have provided clarity for businesses in important areas. This was especially true with merger enforcement, where the agencies withdrew existing horizontal and vertical merger guidelines (for the latter, just the FTC) and issued new merger guidelines which, as ITIF has argued, are problematic in a number of respects. This was also the case in the area of Section 5 of the FTC Act, where the FTC threw out a prior bipartisan policy statement in favor of a new statement articulating an expansive and faulty interpretation of its authority. Furthermore, the FTC just withdrew some guidelines without replacing them at all, including in the critical areas of standards essential patents and health care. The result has been a climate of uncertainty for American business concerning key aspects of antitrust that a second Trump administration will have to immediately remedy-especially if it wants to restore inflation-fighting corporate investments.

3. Overcapacity and Underperformance

To complicate matters further, the frenetic reign of the neo-Brandeisians has all but exhausted the resources of both DOJ's Antitrust Division and the FTC: As calculated by one analyst, almost half of the S&P 500 is currently being sued or investigated by the antitrust agencies. And, while DOJ and the FTC are spending millions of taxpayer dollars in the service of an ideological crusade against big business, especially Big Tech, not only did they lose both of the two litigated tech actions they brought during the Biden administration-Microsoft v. Activision and Meta v. Within-but core agency functions are substantially underperforming. As has been noted, merger enforcement is down relative to both the Trump and Obama administrations, with just 17 actions in 2023-the lowest number in 20 years. The same is true with cartel fines : From 2021 through 2024, DOJ obtained fewer penalties than the Trump administration did in just 2020 alone, and certainly well below the fines during several years of Obama administration.

4. The Frail State of Antitrust Institutions

In addition to this dysfunction-and related to it-antitrust policy in a second Trump administration will be burdened at the outset by an institutional malaise that has metastasized over the course of the Biden administration, especially at the FTC. As a recent report by the House Committee on Oversight and Accountability concluded, over the course of her tenure, "Chair Khan has sidelined career FTC staff, collapsed their morale, triggered an exodus of critical employees, and destroyed career staff's confidence in the honest and integrity of Commission leadership." Specifically, according to the Partnership for Public Service Best Places to Work in the Federal Government, the FTC's score went from a very high 89.1 in 2020 to 64.9 in 2021 and 67.3 in 2022. While it recovered marginally in 2023, that was likely due in large part due to selection bias produced by attrition of disgruntled FTC staff. Indeed, in 2023, FTC staff still ranked the effectiveness of senior leaders at a dismal 55.7 (19th out of 23 mid-sized federal agencies). Clearly, and irrespective of the ultimate antitrust goals of the next administration, the next FTC chair will need to engage in some serious morale renewal as this status quo simply cannot stand: The new leadership must take urgent action to support the many dedicated lawyers, economists, and staff who remain at the FTC and want to see antitrust enforcement based on the rule of law and not political agendas.

5. Antitrust Regulation at the FTC

To be sure, many Trump-aligned conservatives will no doubt revel at the idea of "deconstructing the administrative state," and there will be plenty of opportunities to do just that in the area of antitrust. Most notably, under the Biden administration, the FTC boldly asserted its claimed authority to issue competition regulations or rulemakings, and specifically a noncompete ban that invalidated 30 million such employer-employee agreements over the dissent of both Republican commissioners. As such, not only can the new government turn back this troubling move toward antitrust regulation, but it should strongly consider, as ITIF has previously recommended, working with Congress to scale back competition enforcement at the FTC and ultimately combine all antitrust enforcement into one agency, DOJ, as virtually all OECD nations do.

6. The International Assault Against American Tech

Unfortunately, the FTC has not been the only agency in the global marketplace to push for competition regulation. Earlier this year, the European Commission began enforcing its Digital Markets Act (DMA), which targets America's largest technology companies with an ex ante regulatory regime for which large fines are already on their way. As ITIF has made clear, the DMA is rapidly being imported by various jurisdictions around the world, creating the specter of a regulatory tidal wave that poses potentially unprecedented risks to U.S. tech firms. But rather than advocate forcefully for America, the neo-Brandeisians have been enablers of this global assault against its leading innovators, allegedly going so far as colluding with foreign enforcers to a block merger between U.S. companies that had no business in their jurisdictions, as House Oversight Committee Chair James Comer explained in a letter to Chair Khan.

The success of the previous antitrust revolution that transpired over the 1970s and 1980s in response to the progressivism of the New Deal period was due in no small part to the Clinton administration's continuation of the general economic and consumer welfare approach that the Reagan and Bush I enforcers championed. By contrast, the neo-Brandeisians' attempted coup of the U.S. antitrust enterprise likely will soon prove to have been short-lived: As Trump ally Elon Musk has publicly stated, Chair Khan-whose term has already expired-"will be fired soon." Without question, the end of the neo-Brandeisian onslaught against America's free enterprise system will in itself be both a major achievement and a starting point for a proper rethinking of antitrust policy to meet the challenges of a new era.

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