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Concentration in certain industries isn’t necessarily a problem, but companies that dominate a market don’t get a “free pass” to violate antitrust laws, the head of the Justice Department’s antitrust division said April 13.
“Big is not bad,” said DOJ Assistant Attorney General Makan Delrahim at the American Bar Association’s annual antitrust conference in Washington. “Big that behaves badly is bad.”
Delrahim’s comments are his most forthcoming to date about the wave of sentiment against big companies in the U.S. and Europe.
To say the U.S. has a monopolization problem is “too broad of a brush to paint on this issue,” he said. To find antitrust violations, enforcers should study the impact of a concentrated market in a specific area.
“You have to look at the relevant markets to see if there actually is a monopoly in an area.”
Populist thinkers argue that current antitrust oversight is too focused on price effects. They say enforcers should take a more holistic approach on how mergers and consolidation impact an array of social and economic factors like employment, wages, consumer privacy, and the ability to enter a market as a competitor.
High-profile mergers like Amazon.com’s acquisition of Whole Foods Market Inc. in 2017 and AT&T Inc.'s ongoing attempt to purchase Time Warner Inc. have caused advocates to push for changing the antitrust laws to allow regulators to examine more widespread repercussions of multifaceted mergers. In 2017, Sen. Amy Klobuchar (D-Minn.) introduced a bill (S. 1812) that would require merging companies to prove their deal benefits competition, for example.
Critics of the movement, such as Tad Lipsky, former head of the Federal Trade Commission’s Bureau, believe that approach is too broad and would instill inconsistency in the antitrust review process.
Delrahim said the free market, not the Justice Department, should determine how prices, competition, and innovation interact in an increasingly concentrated marketplace. He sees the role of the antitrust division as analyzing merger activity or alleged anticompetitive behavior, proposing changes where needed, and then letting the parties loose.
“The government’s role should be to get in, enforce, remedy via structural remedies, and get out and let the markets decide,” he said.
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