US President Joe Biden is reportedly planning to appoint antitrust scientist Lina Khan to the Federal Trade Commission, a move that indicates his government is open to aggressive antitrust regulations, not only in general but also specifically against Amazon and others. Big Tech Enterprises.
The Washington rumor mill has driven Khan’s name as a possible candidate for the commission since Biden won the election, and Politico reported today that the White House is indeed planning to run for the role, which the Senate must confirm. At present, Khan is an associate professor at the Law School.
In 2017, while still a law student, Khan vaulted directly into the antitrust superstructure when she published her instant “Amazon’s Antitrust Paradox” in the Yale Law Journal.
Antitrust law, as we have explained, is not just about monopolies, but rather about markmag. In short: it’s good to be the largest company in a sector, but to harm consumers or competitors to become and remain so is not.
Since about the inception of the Reagan administration, federal antitrust regulators have largely adhered to a theory of competition law, the Chicago School, which takes a narrower view of antitrust enforcement than previous schools of thought. At a very high level, Chicago fans tend to think of competition and mergers in terms of price control. Basically, if you control a market, you can blackmail buyers; therefore, competition is necessary to drive prices. In the same way, competition should also be good if consumer prices do not rise.
In ‘Amazon’s Antitrust Paradox’, Khan argues that the use of consumer prices as the most important measure to determine whether a company or a merger is competitive is not sufficient and that Amazon’s size and scope do not make it competitive. “Specifically,” she wrote in the summary, “the current doctrine does not appreciate the risk of predatory pricing and how integration across different business lines can be competitive.”
Her work made a huge splash. FTC Commissioner Rohit Chopra, a Democrat, was looking for her as an adviser in 2018 when the commission began a review of antitrust enforcement. “It’s rare to encounter a prodigy like Lina Khan,” Chopra told The New York Times in 2018. ‘Nothing about her career is typical. You do not see that many law students publish groundbreaking legal research or research that has such a profound impact so quickly. ‘
On the other hand, critics call her theories ‘hipster antitrust’.
During 2019 and 2020, Khan served as one of the staff members of the House subcommittee that compiled a massive, striking report examining the antitrust implications of Big Tech. After 16 months of hearings, research and analysis, the committee ruled last fall that Amazon, Apple, Facebook and Google were in violation of competition law in some way and that they should rule.
The news that the White House is planning to nominate Khan comes just days after the government announced it was hiring Tim Wu as a special adviser on technology and competition policy. Wu also has a strong background in antitrust analysis. His most recent book, 2018s The curse of greatness, argued that uncontrolled market concentration leads to a new Gilded Age and all the attendant problems associated with it.
The FTC has already filed a complaint to break Facebook, and it has reportedly been investigating the best part of Amazon for two years. The appointment of Khan is a likely indication that the agency will act more, rather than less, in the coming months.