Saturday, 17 Apr 2021

Opinion | On Monopolies, Biden Should Follow F.D.R.’s Example

During his nomination hearing, Attorney General Merrick Garland said he would “vigorously” enforce U.S. antitrust law. As the Biden administration actively considers who will lead that enforcement effort as the head of the Department of Justice’s antitrust division, they should look to the legacy of Franklin Delano Roosevelt for inspiration.

Often overlooked in comparison to other aspects of his presidency, President Roosevelt’s push to revive languishing antitrust enforcement helped set the United States back on the right track, creating job and wealth opportunities for Americans at one of the lowest points in the nation’s history.

The reinvigoration of antitrust enforcement helped usher in an era of entrepreneurship and small-business growth. The United States was able to assert itself as a global economic leader, establishing a model of corporate decentralization that would be adopted by democratic nations across the world. But reinvigorating antitrust did not come without substantial opposition from business interests as well as judicial and enforcement bodies that lost their way. Indeed, Roosevelt’s plans were only as strong as the people he appointed to turn his vision of an open market economy into reality.

As Mr. Biden considers his choice to lead the department’s crucial antitrust division, he should look to Mr. Roosevelt’s choice of Robert Jackson, a lawyer in private practice, for the role as an example of what strong, progressive leadership in the agency can accomplish. Though Mr. Jackson is best known today for his tenure as attorney general and later as an associate justice of the United States Supreme Court Justice, it is perhaps his role in transforming America’s antitrust laws and institutions where he made his biggest impact.

Mr. Jackson’s 14-month stint as head of the antitrust division in 1937 and ’38 was the most consequential in the agency’s history. He took on the role at a time when the division was in an “almost moribund” state, and was tasked with a job more significant than simply litigating and winning cases. He had to rebuild a broken system that had led to such a degree of corporate control that it threatened democracy itself. Robert Jackson was not alone in his observation that antitrust policy and enforcement was not rising to the challenge of the times.

F.D.R. himself addressed the issue directly in a resounding when accepting his renomination before the Democratic National Convention in 1936 by referring to the monopolies of the day as “royalists” with “concentration of control over material things” and lamented that “the whole structure of modern life was impressed into this royal service.” This was nothing less than a call to action for Mr. Jackson’s team of trustbusters that would take hold shortly after Roosevelt’s decisive re-election.

Through Mr. Jackson’s leadership, the federal government would emerge victorious in numerous landmark antitrust cases. These include United States v. Socony-Vacuum Oil Company (1940) decision, in which the petroleum giant was demonstrated to have engaged in illegal price-fixing, and United States v. Alcoa (1945), in which the company was found to hold an illegal monopoly position in the aluminum market. These industrial giants were the Silicon Valley of their day in terms of wealth, power, and influence.

Mr. Jackson’s leadership did more than just transform the functions of the Antitrust Division and change how the judiciary and Congress approached matters of antitrust. It also helped break the unelected and unaccountable trusts that were becoming more powerful than the government itself. And it resulted in economic growth and opportunity that was broadly shared, not just for wealthy shareholders.

By the 1980s, though, antitrust policy had experienced another transformation, this time for the worse. It had become a tool to facilitate, rather than limit, corporate power, and American consumers have been paying dearly for this ever since.

Whereas the antitrust laws used to focus on limiting corporate power and concentration, antitrust law since the ’80s has been redefined by government agencies and academics to bolster corporate growth rather than preserve competition. Over the past four decades, American antitrust enforcement institutions like the Justice Department have eroded, a devastating trend that has been unfortunately facilitated across partisan lines. Some of the greatest failings of the past 40 years occurred during the eight years of the Obama administration, during which monopolization enforcement cases came to a grinding halt.

Today, as a result, the legal and policy framework for antitrust enforcement is even more narrow than when Mr. Jackson took the reigns in 1937. Decades of judicial precedent and agency forbearance have, in effect, rewritten the antitrust laws in the mold of Judge Robert Bork rather than the Sherman Antitrust Act’s namesake, Senator John Sherman.

Just as F.D.R. seized the opportunity to reinvigorate and redefine antitrust, Biden is confronting a moment that we may not see for another half-century. The growth and failures of the past 40 years have caused corporate concentration that threatens the foundations of our democracy. Nowhere is this more apparent than with the case of modern-day tech giants, which wield even greater power over our lives than the trusts from yesteryear, such as Standard Oil and AT&T. Today’s giants permeate our lives, mediating our social relationships and controlling our access to information.

The best way for President Biden to meet this “F.D.R. moment” is to appoint a modern-day Robert Jackson to lead the antitrust division. The agency needs a bold leader who will embrace a vision of open markets that will long outlast any one administration. As Robert Jackson noted in 1937: “[W]e cannot permit private corporations to be private governments. We must keep our economic system under the control of the people who live by and under it.” These words ring just as true today as they did nearly 50 years ago, and Mr. Biden has a historic opportunity to meet the moment and appoint antitrust officials committed to tackling corporate concentration.

Mark Pryor, a lawyer, is a Democrat who was a U.S. senator from Arkansas from 2004 to 2014.

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