Q&A / May 28, 2024

Is 2024 the Year of Trust-Busting?

Matt Stoller and Stacy Mitchell discuss the battle against monopoly power.

Laura Flanders

Matt Stoller and Stacy Mitchell.

(Left: Jason LaVeris / FilmMagic Right: Shawn Patrick Ouellette / Portland Portland Press Herald via Getty Images)

President Joe Biden is no corporate dragon slayer, but the woman he appointed to head the Federal Trade Commission or FTC, Lina Khan, comes pretty close. With a long history in antitrust law, she has brought more challenges than we have seen in decades, slowing many mergers and stopping a few. That doesn’t mean that corporations don’t keep consolidating their power in terrifying ways—in industries like healthcare, oil, telecommunications, media—even blood. But there has been a policy shift. Stacy Mitchell is co–executive director of the Institute for Local Self-Reliance and Matt Stoller is author of Goliath: The Hundred Year War Between Monopoly Power and Democracy and publisher of the newsletter BIG on Substack. Mitchell has played a leading role in today’s growing anti-monopoly movement and her work informed the Federal Trade Commission’s antitrust lawsuit against Amazon in 2023. Stoller is the former policy adviser to the Senate Budget Committee and worked for a member of the Financial Services Committee in the US House of Representatives during the financial crisis.

—Laura Flanders

Laura Flanders: Should we who care about breaking up enormous monopolies be celebrating?

Stacy Mitchell: I think we should feel very excited. We have seen a real sea change in how people think about these issues and in what government is currently doing. It’s hard to say where the future is going, but I don’t think we’re going backwards. We have seen government, the FTC and the Department of Justice dust off laws that have been lying dormant for most of our lifetimes and going after concentrated corporate power. They are doing it in the context of building this growing political base. The reality is that most Americans—small business owners, farmers, ranchers, pharmacists, working people, consumers—everybody has a stake in dealing with a problem of concentrated power.

LF: Matt, how would you look at the same picture? The statistics are pretty clear that there’s been more action, but there’s also been a spike in merger efforts, merger filings.

Matt Stoller: It’s hard to look around the world and say, “Oh, things are going great.” It just feels like an overwhelming bummer, but that’s really the residual consequences of 40 years of horrible policy. What we’re seeing now, and it’s not just Lina Khan, it’s a whole bunch of other people, is what I would consider a delayed policy reaction to the financial crisis of 2008. The younger generation of policymakers have said, “No, actually too big to fail is a problem, and it’s a problem everywhere.” You’re starting to see significant change, but it takes a while to reorient it. From 1998 to 2020, there wasn’t a single monopolization charge from the Department of Justice, not one. The Sherman Antitrust Act, the main part of it is monopolization, and they didn’t use it once. Today, there are five antitrust cases, state and federal, against Google alone. But you also see actions against Amazon. You’re seeing investigations of United Health Group. The other factoid that I bring up is that the Department of Justice Antitrust Division had never stopped an airline merger. Everybody knows the airlines are consolidated, and they overcharge people. Since the Biden administration started, there have been two successful merger challenges. One of them was a kind of a quasi-merger challenge about a joint venture between American Airlines and JetBlue. The other one was Spirit Airlines and JetBlue and that was a successful challenge. One result is that airline prices today are lower than they were before the pandemic, because airlines actually have to compete. It’s hard to make the optimistic case, but if you look at the guts of policy, which is what Stacy and I pay attention to, it is actually an extraordinary time, and we will and are starting to feel these positive effects.

LF: Stacy, you have worked closely with the caucus that exists in Congress on this very question. What are you arguing is the problem?

SM: Just about every sector of the economy is incredibly concentrated in the hands of a very small number of corporations. For many years, the effects of this were felt by working people, small businesses, and farmers. The bill of goods that were sold was that this was going to be good for consumers and make the economy work better, allowing all of these corporations to merge, grow larger, and take over one industry after the other. The idea was we were going to get more output, more efficiency, and these kinds of benefits. We lost many generations of businesses. We have farmers that are screwed, communities that are screwed, but we’re going to reap all these rewards in other ways. Today, not only is it clear that we have extreme inequality, that the cost we have paid as people who produce value and work for a living has been extreme, but we also have an economy that doesn’t function very well. There are all of these communities, urban and rural, that are missing basic services. They don’t have grocery stores. They don’t have pharmacies. They don’t have banks. We have sectors where one disruption can shut down the supply of meat or baby formula. This is dysfunctional.

LF: I’m seeing in some of the new merger guidelines, more attention to the labor force. Matt, I wondered if you wanted to speak to that part of this story.

MS: Antitrust and labor for a variety of historical reasons have kind of been separated. You have labor law and then you have antitrust law, which mostly people have thought of in product markets, like the stuff you buy and sell. But as it turns out, you can apply it to labor markets because companies buy and sell labor. What scholars have realized, and normal people realized before the scholars did, is that labor markets are really concentrated. It’s pretty hard to get a job with someone else in the same industry when you have few options to do that. When you have a merger, you get to lower wages. In the 1980s, the whole thing about mergers was, “Cool, we get to lay a bunch of people off.” That is a lessening of competition in a line of business for work. But we didn’t actually develop the economic and legal tools to address that until relatively recently. Now for the first time with a merger in the book publishing industry, which is Penguin Random House and Simon & Schuster, that was challenged by the Antitrust Division and now a challenge of the mega merger between Kroger and Albertsons supermarket chains, you would now have the enforcers saying that consolidating power over workers is in itself a violation of the law.

LF: These are, as you said, Stacy, exciting times, extraordinary times in lots of ways. We’ve painted out what’s good. What are you most concerned about?

SM: The power of the tech companies. We have a handful of companies that control the flow of information and commerce. It is an extraordinary amount of power that they have.

LF: Does AI change the picture? I’m looking at OpenAI buying this and buying that. That has me a little nervous.

SM: Absolutely, and because of the computing resources that are required for AI, in the absence of intervention, it’s going to be Google, it’s going to be Microsoft, it’s going to be Amazon that are able to control AI, because nobody else has the computing power and the money to run those systems. The real risk here is that they will use control over this new technology to prevent new developments that would challenge their power and to use it in ways that only augment their power. That’s deeply concerning.

LF: There is bipartisan interest on this question. In the last presidential race, we saw both President Biden and former President Trump talk about breaking up big corporations. I’m not a partisan person in this. I have plenty of critiques of President Biden, but the records of these two administrations are quite different. Could you lay out the distinctions?

MS: I’m probably more charitable to the right than Stacy, but I think a fair comparison would be, there was a bill that passed in 2022 called the Merger Monetization, Merger Filing Fee Modernization Act, which strengthened antitrust laws, and it wouldn’t have passed with just the Democrats, just the Republicans. Trump allowed Disney to buy Fox. He allowed the consolidation of Hollywood. He allowed a lot of consolidation, but he also initiated antitrust suits against Google and Facebook, against AT&T–Time Warner. With Operation Warp Speed, he handed out I think nine different contracts to pharmaceutical companies. They competed for that. Every presidency is a number of different factions, and there were some anti-monopoly factions in the Trump administration. The anti-monopoly factions in the Biden administration are much larger and much more powerful.

LF: Stacy, but you’ve been working for years with your colleagues for local sustainable economies. Do you think we’re at a turning point?

SM: We are definitely at a fork in the road, and I have a lot of hope. We are at least talking about the core issues in a way that I don’t think was true a decade ago. My organization has been working for many years around how do we build up the right kinds of local economic systems that nurture communities, create prosperity, happiness, and sustainability. If we can change this bigger structure, great local solutions suddenly have the oxygen to grow.

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Editorial Director and Publisher, The Nation

Laura Flanders

Laura Flanders is the author of several books, the host of the nationally syndicated public television show (and podcast) The Laura Flanders Show and the recipient of a 2019 Lannan Cultural Freedom Fellowship.

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