After the second Trump administration initially appeared to maintain significant continuity in antitrust enforcement, the president more recently thrust the agencies into turmoil. Those later actions create troubling risks to the economy and the rule of law, writes Jonathan B. Baker.
For the first two months of the second Trump administration, antitrust enforcement was largely insulated from the drama affecting other government agencies. The administration’s initial moves promised continuity in many core areas of antitrust. But more recent actions may presage an emerging Alice in Wonderland antitrust policy where, as Jefferson Airplane put it, “logic and proportion have fallen sloppy dead.”
By appointing new leadership with substantial antitrust expertise to the Antitrust Division, the administration suggested it was not breaking with the past. In addition, the heads of both the FTC and the Antitrust Division have supported many important Biden administration antitrust initiatives. They continued to pursue monopolization cases against large digital platforms, some of which were instituted during the first Trump administration. They also endorsed their predecessors’ new focus on labor antitrust and its concern with the exercise of market power to lower wages, harming workers. They preserved the 2023 Merger Guidelines and the 2024 premerger notification rules, despite substantial criticism from antitrust conservatives and counsel for merging firms, respectively.
The new agency heads did cut back on some Biden-era approaches, such as by reinstating early termination of merger reviews when a preliminary investigation did not raise concerns. FTC Chair Andrew Ferguson prefers that his agency act through adjudication rather than rulemaking, which his predecessor, Lina Khan, occasionally sought to employ. The new heads have also indicated a greater willingness to accept settlements as remedies in merger cases. But overall, those early shifts were no more significant than the policy changes that followed past transitions of the executive branch from one political party to another.
More recently, however, shocks from the earthquakes buffeting other government agencies have spread to antitrust enforcement. First, President Donald Trump fired the two Democratic FTC commissioners, with the support of the two Republican commissioners. (The legality of that action will be decided in the courts). Trump’s decision is hard to rationalize given that he did not need to dismiss anyone to advance his party’s policies once his nominee for the third Republican commissioner seat, Mark Meador, was confirmed. Meador, confirmed on April 10, would likely have been confirmed quickly if Trump had not taken this step.
Nor does Trump’s action make sense if his primary goal is to advance the legal theory under which he claims he can ignore the 1935 Supreme Court decision that prevents him from removing FTC commissioners without cause. The theory is already being tested in court cases challenging Trump’s authority to remove heads of other independent agencies and in private lawsuits by FTC-sanctioned firms challenging the constitutionality of enforcement against them.
Removing two commissioners also places the legality of agency action under a cloud even with the third Republican confirmed, particularly decisions that could have come out differently had the two other Democratic commissioners participated. Furthermore, it undermines the ability of the FTC to pursue its distinctive role as a bipartisan forum for antitrust policymaking and adjudication.
Second, the FTC and Antitrust Division are increasingly subject to internal turmoil and uncertainty, impeding effective enforcement. The administration had placed the two agencies under considerable budgetary pressure, potentially affecting staffing of even the most important and high-profile cases, even before Elon Musk’s Department of Government Efficiency (DOGE) arrived at the FTC. The DOJ withdrew employment offers to honors law students, and the FTC terminated probationary staffers. The deputy attorney general has proposed closing the Antitrust Division’s field offices in charge of tech enforcement and prosecuting agricultural cartels and proposed shifting the personnel in the legal policy and expert analysis sections (including its economists, who play a critical role in investigations and litigation) to a DOJ component outside the Division. Anecdotally, many experienced staff, concerned about their work environment, have left the agencies or are planning to do so. Collectively, these developments hobble federal antitrust enforcement.
Third, and most troubling, both the rule of law and the economy are threatened by the prospect that the administration would act in antitrust the way it has begun to act elsewhere. This danger arises when merging firms and antitrust defendants, reportedly including Meta CEO Mark Zuckerberg, negotiate directly with the president to settle their cases or avoid antitrust challenge—as Trump has been doing outside of antitrust with TikTok, Nvidia, and U.S. Steel and with some firms and industries affected by tariffs. The administration’s concern with Big Tech firms appears to focus on the alleged suppression of conservative voices by “woke” corporations. That focus could create room for Zuckerberg to settle the FTC’s antitrust case in ways that advance conservative political interests without remedying the way Facebook’s acquisitions of Instagram and WhatsApp harmed competition in personal social networking. The executive orders that close agency doors (presumably including the Antitrust Division and perhaps the FTC) to law firms that the president dislikes, and the administration’s deals with law firms requiring them to invest pro bono resources on causes the administration supports, suggest to private industry that firms should attempt to buy off enforcement by hiring advisers that Trump considers friendly and, more generally, by proving in advance their support of the administration policies.
This approach to antitrust enforcement would allow settlements and prosecution decisions to be influenced by Trump’s political interests, his extensive personal and familial financial interests, and the financial interests of close advisers like Musk. That would undermine the ability of the antitrust laws to prevent firm conduct that harms competition. Presidential instructions to the FTC that erode its independence and autonomy also raise the same statutory and constitutional problems presented by the removal of the Democratic FTC commissioners.
Even worse, if an agency resolves a case or investigation according to presidential instructions, and the president reaches his decision without considering input from agency staff and other interested parties and without reviewing the detailed factual record developed by an agency investigation, that resolution would violate the president’s constitutional obligation to “take care that the laws be faithfully executed” and would reasonably be considered an impeachable offense. A direct presidential role also harms antitrust enforcement by diminishing the authority and credibility of agency officials with courts and firms.
The resulting threat to economic prosperity is insidious. When firms can evade antitrust proscriptions by negotiating deals, competition and prosperity are harmed directly. When firms realize they have to pay tribute to conduct their business—even if their mergers or business conduct would ultimately be found not to violate the antitrust laws after a long and expensive trial—they would be expected to channel their business activities to navigate around the president and his family’s financial interests, which in the case of Trump extend from hotels and golf courses to social media (Truth Social) and finance (cryptocurrency). Firms would also be expected to navigate around the president’s political interests, which could, for example, discourage investment in pharmaceutical research (e.g., for vaccine development). And the uncertainty generated by that way of doing business will by itself make investment less attractive, further inhibiting economic growth.
Finally, Trump’s emerging economic war against the United States’ major trading partners in North America, Europe, and Asia undermines the ability of the U.S. to advance international economic norms that benefit domestic firms, including the Big Tech firms that find themselves targeted by enforcers abroad as well as at home. Our trading partners are increasingly being told to fend for themselves through Trump’s foreign policy as well as his tariffs. Those nations would be wise to preserve competition policy for themselves, twinned with an industrial policy that protects their own defense interests and creates the kind of spillovers that would encourage the development of the industries of the future in their nations rather than in the U.S. As they do, though, they will be increasingly resistant to U.S. advocacy on behalf of U.S. firms to ensure that foreign competition authorities offer firms subject to their investigations due process protections such as “nondiscrimination, transparency, timely notice, meaningful engagement, timely resolution, confidentiality protections, avoidance of conflicts of interest, access to information, opportunity to defend, access to counsel, attorney-client privilege, written decisions, and judicial review.”
Against the background of other Trump administration threats to economic prosperity, democracy, due process (e.g., abductions and deportation without hearings), scientific research, speech, and global stability, these antitrust concerns may not loom large. They are important all the same.
Author Disclosure: Jonathan B. Baker is Professor of Law, Emeritus, American University Washington College of Law and Senior Academic Advisor and Fellow, Thurman Arnold Project, Yale University. In the past, Baker has served at the FTC as Director of the Bureau of Economics and as an Attorney Advisor to the Acting Chairman, and at the Antitrust Division as Special Assistant to the Deputy Assistant Attorney General for Economics. During the past three years, he testified for state government plaintiffs in U.S. v. Google (the government’s Google Search case) and consulted for private plaintiffs and defendants. He is a Special Consultant with Econic Partners.
Articles represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty.
