The Horizons of Antitrust

By Steuer, Richard M. | St. John's Law Review, Spring 2017 | Go to article overview

The Horizons of Antitrust


Steuer, Richard M., St. John's Law Review


Two economic issues that appeared front and center during the 2016 United States presidential election campaign were jobs and inequality. Among the solutions being offered was heightened antitrust enforcement. Some argued simply for more enforcement, while others argued that the standard for applying the antitrust laws itself needed to be changed.

The goals of antitrust law have been debated for as long as these laws have been on the books, but now, with competition laws in effect in over a hundred countries, that debate has gone global and has assumed renewed urgency.1

Not only are there wildly different opinions within the United States, but the goals pursued by other nations vary widely, creating significant asymmetries that can advantage one trading partner over another.

Until about forty years ago, there was considerable support in the United States for an expansive view of antitrust goals, one that included such objectives as the dispersion of economic and political power. Since that time, most of these goals have been eliminated from antitrust analysis in the United States, leaving only the goal of fostering low prices, high quality, and high output at low cost. This goal is commonly termed "consumer welfare" or "total welfare," since advocates of this standard usually have defined it to encompass the combined economic welfare of consumers and producers, regardless of how that welfare is distributed between them.2 By either name, the goal is greater efficiency, resulting in lower costs and prices for more and better products or services.3

But there are other goals that are priorities in the world's economies, including not only full employment and altered income distribution, and not only the dispersion of economic and political power, but also national security, the preservation of domestic control over critical resources, the survival of small businesses, integration of disparate economic systems, preservation of minority cultures, preservation of a diversity of viewpoints, preservation of the environment, and others.

American antitrust jurisprudence once appeared inclined to embrace a host of these objectives. In one of its first antitrust opinions, the United States Supreme Court expressed particular concern about anticompetitive practices "driving out of business the small dealers and worthy men whose lives have been spent" in commerce.4

In 1977, United States Federal Trade Commission Chairman Michael Pertschuk went further and said that "no responsive competition policy can neglect the social and environmental harms . . . : resource depletion, energy waste, environmental contamination, worker alienation, [and] the psychological and social consequences of marketing-stimulated demands."5

In 1979, Professor-and later FTC Chairman-Robert Pitofsky published an influential article, The Political Content of Antitrust,6 in which he wrote: "It is bad history, bad policy, and bad law to exclude certain political values in interpreting the antitrust laws." By "political values," he meant:

[F]irst, a fear that excessive concentration of economic power will breed antidemocratic political pressures, and second, a desire to enhance individual and business freedom by reducing the range within which private discretion by a few in the economic sphere controls the welfare of all. A third . . . concern is that if the free-market sector of the economy is allowed to develop under antitrust rules that are blind to all but economic concerns, the likely result will be an economy so dominated by a few corporate giants that it will be impossible for the state not to play a more intrusive role in economic affairs.

In reaction to these views, other law and economics scholars-many from the ascendant "Chicago School"-cautioned that inclusion of any goals other than consumer welfare would lead to chaos.7 That view came to prevail in the United States, to the point that even under the Obama Administration, leaders of the U. …

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