Oct 22, 2021
On October 19, The Capitol Forum hosted a conference call with Barry Lynn, Executive Director of the Open Markets Institute, to discuss the Biden administration’s approach to antitrust enforcement and supply chain fragility. The complete transcript, which has been modified slightly for accuracy, can be found below.
TEDDY DOWNEY: Good morning, everyone. Thanks for joining us today for The Capitol Forum’s antitrust policy conference call. I’m Teddy Downey, executive editor of The Capitol Forum. I’m joined today by Barry Lynn, executive director of the Open Markets Institute.
A quick note before we get underway. For the first 20 minutes or so of the call, I’ll interview Barry and then we’ll move into a Q&A format where we will entertain questions from the audience. If you have questions for us, please email them to firstname.lastname@example.org. And thanks so much for doing this today, Barry.
BARRY LYNN: Hey, thanks for having me. It’s great to be here.
TEDDY DOWNEY: And first off, I just wanted to congratulate you on all the success that you and your organization are having. A lot of people from your organization or with ties to your organization are going into the government. And I think probably the thing on everyone’s mind is how this movement, which even 10 years ago was such a kind of a fledgling movement, has been so successful in that time period, and particularly in persuading the Biden administration and working with the Biden administration to make picks of people who are willing to be aggressive on anti-monopoly policy.
BARRY LYNN: Yeah, I mean, it’s a great question. Because it really is sort of a revolutionary moment. And you, Teddy, I mean, you understand this better than almost anybody because I remember you and I started talking 11 years ago, more than 11 years ago. And there were very, very few people who were focused on this issue.
TEDDY DOWNEY: Yeah, I think we did our first call like this 11 or 12 years ago. Yeah, absolutely. And there were not a lot of people talking about it, and very few people interested.
BARRY LYNN: Yeah. No, people thought we were crazy. And so now, going from being outliers to sort of actually having captured large portions of this administration, how did that happen? It wasn’t easy. But there’s a couple of sort of key moments in this process. One of the key moments was back in June of 2016, when Senator Warren gave this speech about this issue, we actually helped the senator sort of understand the issue, and we helped the senator sort of prepare the speech
and then we hosted it. So, as people who are tracking this issue, that was sort of a major leap forward in making this a political issue of the first magnitude in Washington. So I just wanted to make sure that people always understand the power that a senator can have. And in this case, Senator Warren put this issue on the map in a way that it had not been up to that point, despite all the work we had done.
But that doesn’t explain the Biden administration. Because during the campaign in 2020, the candidate Biden, he was one of the few people who weren’t talking about this. There were many candidates that were talking about monopolization during that campaign, and candidate Biden was not one of them. We actually had a lot of hope. We had had contacts with the Biden team, multiple contacts. We knew they understood that this was a big issue. We understood that they were taking a different approach to winning the nomination. Their approach worked. They won the nomination. They won the presidency. So we knew there was interest there, even though he wasn’t talking about it. But we expected that we would end up with a pretty serious effort on certain areas. But we have actually frankly been surprised by how fully the administration has embraced our thinking. So, this is evident in sort of choosing Lina Khan, who had worked for us for many years, to chair the FTC. This is evident in choosing Jonathan Kanter, who is a very close ally for many years to head the Antitrust Division. But also, we see this in this sort of statement of philosophy in the executive order, which is really, truly revolutionary. It’s something people haven’t fully appreciated how radical this administration is on this issue.
TEDDY DOWNEY: And I want to stay on the executive order for a second. Because there are still some people who doubt the administration’s interest to some degree in anti-monopoly enforcement. I think there are a couple of things that I think are interesting about the executive order, and I’m interested to get your take. One is it turns this from an antitrust issue at the FTC and DOJ and turns it into a bigger government-wide issue. And I was wondering if you could talk about that a little bit. What is that? When some of your colleagues and people who agree with you talk about a whole of government approach, is the executive order a move in that direction? And what do you mean when you say stuff like that?
BARRY LYNN: Yeah. I mean, this is important that people understand the importance of the executive order. Because I agree. Like you said, I mean, I’ve talked to many people, antitrust professionals, who are kind of pooh-poohing the importance of this. Oh, it’s just show. It’s just window dressing. But what we’re looking at, though, is a fantastically important statement that is in direct opposition to where any of the administrations in the last 40 years have been. Early in this administration—and this administration, there’s the issue of what they have said and what they’ve been able to achieve. And given the opposition by the Republicans to getting their people into position, given how slow the nomination process has been, this is something that should be judged
at the end of President Biden’s first four years. And I think that we’re going to see that this was a truly game changing moment.
And so why? What is it in the executive order? There’s two things. One is the fact that the executive order includes 72 different actions. It’s on transportation. It’s on steamships. It’s on railroads. It’s on airlines. There are pieces in the executive order on health care and on pharmaceuticals. Inside the executive order, there’s actions on alcohol markets and beer markets and wine markets and the concentration of power that we’ve seen in that area.
So pretty much wherever you look in the political economy, part of that executive order [inaudible] monopoly problem here. And not only do we have a monopoly problem here, but we’ve got powers inside agencies, government agencies, that are not called FTC, not called DOJ, that we can use to fight this. We can use the SEC. We can use the Department of Defense. We can use that the Department of Treasury. We can use the Department of Transportation. We can get Pete Buttigieg out there as an anti-monopoly fighter. And we intend to do that.
So this is a radically different vision of what the state is. And I know this to be the case because I actually published a piece back in the Washington Monthly back in December about how Biden can transform America that made this case. So if people kind of want to understand how Biden is using this, President Biden is using this, I’d urge people to go read that piece.
But then the other side of the executive order was this statement about philosophy. For the last 40 years, we’ve had various versions of the consumer welfare test, the efficiency test, as it was originally called by Baxter, who was the antitrust enforcer under Reagan, in the early years of Reagan, the efficiency test. We’ve had various iterations of this sort of as the governing, how we see competition policy in the United States, under every president from early Reagan up through the end of Trump. And now we have a president who says no. Actually, in the speech that President Biden gave in support of the executive order, he called out Robert Bork by name and he said, what we have been on for the last 40 years is a failed experiment. It was a dangerous experiment and we’re not doing it anymore. And he said the purpose of anti-monopoly law, of competition policy, is not to promote efficiency foremost. It is to protect our democracy and it is to protect our individual liberties. The president of the United States said that.
So that means that anybody out there in the antitrust world, any expert who has been doing this for the last 40 years, the rules have just changed. Humpty Dumpty ain’t going to get put back together again. Whatever Josh Wright may try to do, whatever any subsequent Republican administration or even a sort of retrograde Democratic administration may try to do, you can’t put Humpty Dumpty back together again. What we saw with President Biden’s statement was the most radical statement by a president on this issue since FDR began the Second New Deal in 1936 was his attack on
monopoly, when he pivoted away from concentration to embrace de-concentration. This is the most radical statement in 75 years. And I would encourage every antitrust expert out there to study it and learn it because there’s a new world dawning. And it’s not just the fact that Lina and Jonathan are in those positions. It’s a new way of thinking, a new way of interpreting what we do in the political economy.
TEDDY DOWNEY: I want to get back to how Biden got to this place in a second. But before we do that, I want to talk a little bit about how this gets implemented. Certainly, it’s an extremely important statement. But not all of these picks—let’s take Pete Buttigieg or someone like that—they don’t know about this issue. They haven’t necessarily bought in. Certainly, the president has, but they’re coming from a place where they don’t know this history. How long is this transition going to take? And is it going to be a learning process for some of these people? Or are they going to oppose what the president wants to do?
I think a good example of this is we’re looking into that alcohol study that the Treasury, TTB, is doing with the FTC and DOJ. But these TTB staffers who have been there for 30 years or so, they’ve been there a long time, they’re not used to using their power. They’re used to collecting taxes and not doing very much else. And you guys did a paper on this. They asked how can we deregulate this industry some more? Not only were they seemingly not reading this executive order, but they were going in the opposite direction in terms of doing something that the big alcohol industry wanted. And so are we going to see fights like this where these ideologies clash? How do you see this playing out at all of these different agencies?
BARRY LYNN: Oh, yeah. No, this is going to be a—this is a period of sort of open field running. It’s like the line has been broken. So everything is sort of up for grabs right now. Absolutely, you’re right. There’s a lot of people, smart corporations out there, are like saying, oh, well, the consensus approach to this issue or that issue, well, it just got broken open. So we’re going to go in there and try and influence this and try and structure this to work for us as best we can. So there’s going to be some reverses over the course of the next couple of years. There’s going to be some bad rulemaking that comes out, maybe some just poorly thought-out rulemaking that will be done by well-intentioned people, but who, as you say, don’t really understand the issues. But overall, what we’re going to see is a radically, I mean, we’re going to see a movement in the right direction, and it’s a movement that’s going to increase in speed as people get up to speed.
I mean, just think how does this work? Like going back to the beginning of this conversation 11 years ago, you and I were talking in a coffee shop. Then the last couple of years, we saw 49 U.S. states, plus Guam, plus D.C., plus Puerto Rico, all join investigations of Google and Facebook, and many of those states move against Google and Facebook, bring lawsuits against Google and Facebook.
So what we’re doing is there’s a manufacturing of expertise in anti-monopoly law in competition policy that is going on across America in every state in America and it’s going on around the world. So, yeah, maybe in the Department of Transportation, right at this moment, or right inside TTB right at this moment we don’t have new thinkers sitting inside there, but we’ll get them in there soon enough. And then the power that’s inside of TTB, the power that’s inside of DOT, the power that’s inside the Agriculture Department is like—those are awesome powers that ain’t been used in 40, 50 years, in some cases longer, to promote real competition, to promote smart competition, to build a better society, to build a better democracy, to break the power of the manipulators and the thieves.
So this is a this is like the beginning of World War Two. This is the moment in which Doolittle’s raiders managed to drop some bombs on Tokyo early 1942. It’s like it’s symbolically important. But what we’re seeing is an arming of the American people with the knowledge of how to use competition policy to take down the bad people and protect our democracy for the next 100 years.
TEDDY DOWNEY: I want to stay on this like how did Biden get here? And some of the things I’ve heard—I obviously haven’t asked him—but some of the things I’ve heard is he really cares about his legacy. He really wants to achieve a lot. This kind of sounds vague, but your movement is also now, you mentioned using power to help people or attack consolidated power. Why has the Biden team found this so appealing? Because I know there are a lot of establishment people probably on this call right now wondering how, so comprehensively, they’ve embraced your ideas. Is it the power of the idea? What’s going on there?
BARRY LYNN: Well, I think there’s a few things. I mean, it’s another really important question and important for people to understand this. Number one, it is the fact that the concentration of power that we see today has become so extreme. And we have—there’s analyses here in all of these reports, like the Cicilline committee, and actions that are coming out of the European Union, these lawsuits. And just people staring at what Facebook is doing to our society day after day after day and what Google is doing to our economy day after day after day and what Amazon is doing the retail space day after day and people are waking up all across this country and saying, this is really terrifying. These people are destroying the free press. They’re destroying the public square. They’re empowering the autocrats.
So we have a choice to make. And it’s like either we end up going into a very dark place, from which it will be very difficult to ever exit, or we fight. So I think that we’re seeing this all across this country right now. It’s certainly true inside the administration. But we see this among a lot of Republicans. There’s a lot of serious Republicans out there who are standing up to actually fight this fight. Not just Josh Hawley, but there’s actually people like Ken Buck and many others. Senator
Klobuchar managed to get 12 sponsors total on her bill yesterday. So this is a big deal. So there’s fear. And people are standing up to fight.
But the second thing is just why would President Biden do this? All presidents think about their legacy. All presidents think about how they’re going to read in the history books 100 years from now. I actually think it’s simpler than that. Everything we hear about President Biden, he’s very different than, say, Obama. Obama really believed in experts. He really believed when Larry Summers was sitting there and telling him what to do, he believed Larry was a smart dude. And I think President Biden basically has this deep distrust of those kind of experts. And he has a sort of a simpler view. Not necessarily—when I say simpler, it doesn’t mean less sophisticated. It doesn’t mean that it’s less accurate. But simpler in the sense of what are we dealing with here? And rather than thinking about this through an economic lens, he says, oh, we’ve got a monopolist. Well, that’s a bully. A monopolist. Well, that’s a thief. A monopolist, that is a manipulator and extortionist. And we’re going to enforce the law against extortion, against manipulation, against bullying, against theft.
So we’ve seen a bunch of presidents who fell for the neoliberal line that the political economy is something really complex, and we need scientists, specially trained scientists, to understand what’s going on. And what we’re actually seeing right now is a bunch of folks saying, actually, no, we don’t need a bunch of scientists. We don’t need a bunch of economists. We actually just need a bunch of law enforcers to go in here and enforce the law against bullying and extortion and manipulation and theft.
TEDDY DOWNEY: And when you say one of the themes that comes up a lot is the FTC and other groups are looking more towards forensic analysts, financial analysts, business analysts, instead of economists. They’re looking for real world study of markets. That seems to be something that comes from your ethos a little bit or that we can trace back to you. Maybe you can talk a little bit about the type of rigor that you and your organization go into to study a market before you think about the anti-competitive conduct that’s going in it. Because that’s something that’s really different. That’s a change that’s going on. The FTC is hiring all these people, these forensic and business analysts, instead of economists. And I think that’s also kind of throwing people for a loop. So maybe you can talk a little bit about that. And we obviously see some of the papers that Lina has written are very, very detailed studies. So we’d love to hear more about that.
BARRY LYNN: Yeah, that’s a great question. I started off as a reporter. I worked as a reporter, political and business reporter, in South America and Peru and Venezuela. I ran a magazine called Global Business Magazine for seven years. We were writing for businesses. And we were writing about how to do business for businesspeople. We had a big circulation. We had multiple readers, more than 400 of the Fortune 500 in the C-Suites. So we were writing for very sophisticated
executives about how the world works. So my training was all in facts and in the structures of power.
And I got into this because of the supply—my first book was about all of the things we’re seeing on the front page now with our supply chain problems, lack of semiconductors, these systems that aren’t functioning. My first book was called “End of the Line” and that came out in 2005. And it was based on looking at the world as it was actually functioning, understanding why we’d seen industrial crashes, why we had seen sort of the offshoring of certain activities and to certain places. Like what was the power that was being used to direct where things went and how they were concentrated.
And so in the process of actually writing about how the real world works, I realized that generally most economists have no idea—they have not been trained—to deal with these issues. They have not been trained to study how the real world works. They have been trained to create simulacra, sort of a representation of the world. And then sort of hope that some kind of truth comes out of the representation of the world that they create. And you know what? When you try to understand what is happening on Earth by looking for its reflection in the Sun, you’re just going to blind yourself. And what we have seen is that we have a whole group of economists who really have very little understanding of how the world actually works. So really, this is something I’ve learned. I learned this the hard way. But you had another question.
TEDDY DOWNEY: Well, I was going to just follow-up on that. Is that part of the reason that you’re having so much success? Is there just kind of a little bit of—these problems are really big. They’re clear problems. Google, Facebook, no one says that there aren’t problems here. No one pretends that everything’s fine. They’re just arguing about what the solution should be at this point. But is it that the problems are too big and that a lot of economists come to policymakers and lawmakers with theories rather than kind of results-oriented studies or real world studies? Does that contribute to why you’ve had so much success recently?
BARRY LYNN: Yeah, that’s exactly it. It’s because we deal in two things. We deal in facts. As reporters, we go and we look at what is actually happening? What is the market structure? Who’s in control? The people who are being controlled, what do they feel? What are they saying? What are they observing? And then we go and we look and then we do history. And we just go back and we read. It’s not just antitrust history, but larger political economic history. If you’re just reading antitrust law, you actually miss 98 percent of competition policy. So even the lawyers are, to a certain extent, you know, they’re not as blind as the economists. But the law itself only captures part of what is going on in the larger political economy. And so we do this deep dive into the history of the law, but also the deep dive into the history of political economic thinking.
And my last book, “Liberty from All Masters,” I took this back to the founding of the nation to understand the essential American approach to competition policy that was established pretty much on day one. And so, yeah, in terms of an advantage, we walk into a room with facts about a problem. And we walk into the room with a deep historical understanding of how previous generations dealt with analogous problems, time and again, over the last 250 years. And then other people will walk in with a theory. Or they walk in with some, you know, when the DOJ went after the ATT/Time Warner case, people walked into the courtroom with some really flimsy argument about pennies on the dollar harms because of the concentration. As opposed to the actual concentration of power over speech, over art. So our success has been absolutely due to the fact that we’re armed with—we’ve got better arms. And those arms are called facts and history.
TEDDY DOWNEY: And I want to talk about solutions here because I think everyone on this call is interested in the people that agree who agree with you. What are they going to look for in terms of solutions to problems? And I don’t want to be overly simplistic, but I’ll just bring up the alcohol because there have been some public comments for that already. And you wrote your paper. And it says it’s pretty simple in that it looks at—it says, look, there are these concentrated—there are these large companies in this industry that the rules should neutralize them and breakup their power over the competitors in the three tiers, in production, distribution and retail. So talk about how you come up with solutions and recommendations and how the people who agree with you will think about solutions as well.
BARRY LYNN: That’s important because a lot of people have accused us of being a breakup shop. And that’s sort of the exact opposite—not the exact opposite, but that’s just a small portion of what we advocate. Some historical perspective is useful. Like when I was writing “Cornered,” the book that came out in early 2010, no one was talking about this. No one understood this. So my purpose in that book was really just to reconnect people to the Sherman Antitrust Act. Hey, there’s all this consolidated power. Wal-Mart didn’t used to exist. Now, it exists. They’re concentrating all this power over your community. They’re concentrating all this power, all this wealth in their hands. So money that should be in your hands, power that should be in your hands, is in their hands. Very simple stuff. And then there’s this tool. We can break these corporations up. We used to do that. Let’s learn what we can do under the Sherman Antitrust Act, under the Clayton Act. But that’s political reasons. It’s like to wake people up. If you’ve got an ax in your hand, you can go use it.
But, as we know, when you’re dealing with a network, when you’re dealing with certain parts of Google, certain parts of Amazon, certain parts of Facebook, just the applications that sit on the internet generally, just breaking things up isn’t always going to work. Sometimes people are all going to go to one place to do their business. And then when everyone’s in one place, then you actually have to figure out how do we establish something that looks like a market that is sitting on
this platform? And then you get into this whole other body of law, which is basically anti-discrimination, nondiscrimination law and rules to ensure that the people who control the platform, who control the network, don’t use their control over it to manipulate other people’s business. So you take away from them certain licenses, how they act. Under the common carrier tradition, you have to post your terms and you’ve got to post your prices and you can’t make any backroom deals.
And so that’s really, in some ways, what we’ve been most focused on the last few years. And this goes back to, I mean, when did we really sort of start focusing on this? November 8th of 2017, we hosted then Senator Al Franken, who gave a speech about what to do about Google, Facebook and Amazon. And it was very simple what Senator Franken said. He goes, you know, we applied net neutrality to the gatekeepers of the last generation, and we have to apply the same principles of neutrality to the gatekeepers of this generation—Google, Facebook and Amazon.
So this is really simple. So it’s not just break ups. Even more fundamental than break ups, in this age, especially the age of the internet, is how do you neutralize the platforms? How do you neutralize the networks? How do you neutralize the providers of essential services to ensure that they’re not exploiting their provision of essential services to capture control over other people’s business.
So solutions. Those are really the main solutions is, at this point, more foundational than breaking things up is actually neutralization.
TEDDY DOWNEY: I wanted to stay on the solutions point and bring it back to the point about the whole government approach. Because I think a lot of people who look at policy issues, they sort of look at these kind of compartmentalized risks. So you’re dealing with the SEC. Or you’re dealing with some technical issue with the FTC. Or some other OSHA or something. When you say whole government approach, is that part of the solution as well is to coordinate the Executive Order. Tim Wu at the White House kind of coordinates all of these different agencies and how they look at things. Is that also part of the solution? And how will companies readjust to going from dealing with each agency individually to having to deal with coordinated assessment of their power? And how does that play into the solutions that you guys talk about?
BARRY LYNN: Yeah, that’s more like the means, the practical institutional means, of applying the principles, nondiscrimination being a principle. So then the practical institutional means are to use the government, as many agencies within the government as possible, to achieve this. And like, for instance Phil Longman of Open Markets, he did a piece recently about railroads and he was looking at American railroads are collapsing. Everyone’s saying, oh, we can’t move boxes, containers, we can’t offload them, in the Port of L.A. Long Beach because there’s not enough stevedores. There’s not enough trucks.
It’s like no, boys and girls. Actually, the reason you can’t offload them in those containers is because there’s no place because the Union Pacific sold off one of its yards in Chicago. They had two yards in Chicago to store containers and they sold one off. So suddenly they didn’t have any place to unload containers. And why did they do that?
They did that because for 40 years now, we’ve allowed sort of financiers—well, not quite 40 years, but certainly 25 years—we’ve kind of allowed financiers to run our infrastructure for us without any kind of real government oversight. We kind of privatized all this infrastructure and let the financiers do what they wanted to do with it. And so they sold it off. So now that’s something that the Service Transportation Board, the Department of Transportation, Pete Buttigieg, part of his writ is to fix the supply chain crisis. Well, that means that you’ve got to fix the railroads. That means you’ve got to get Wall Street out of railroading, at least in the way it is now. You’ve got to change the power structure within the railroad system.
So is that something that the FTC or the DOJ is really going to be doing now? But that’s really up to Secretary Buttigieg. It’s up to the head of the Surface Transportation Board. But you take this and you carry this through USDA. I mean, it’s like Packers and Stockyards. Like you use Packers and Stockyards Act the way it was designed by Congress. And you can restructure the entire political economy of food and farming in America. That’s the power that’s in the Packers and Stockyards Act. Does Secretary Vilsack fully understand that? No, he doesn’t fully understand that. Does he understand more about it than he did a year ago? Oh, yeah. He understands a lot more about it than he did a year ago. So will he understand more about it a year from now? I would suppose he will. And I suppose if he chooses not to learn, he might not actually be sitting in that seat a year from now.
TEDDY DOWNEY: We’re running out of time here, but I want to open it up for questions. If you have a question, email us at email@example.com. We’ve gone through a number of industries, Big Tech, alcohol, ag, rail. You mentioned national security. What can be done there? And what are you hoping to see there?
BARRY LYNN: Yeah, the intersection of competition policy and national security used to be really well understood in this country, going back to the Declaration of Independence. The Declaration of Independence was not simply of man from man. It was also of nation from nation. And in that case, we’re saying we don’t want to be an outlying province within the system of commerce that is centralized in London, the system of power that is centralized in London. We want to be our own people. We want to be our own nation. The War of 1812 was also the same thing. We wanted independence from
competition. We want to be able to sell, not just to Britain. We want to be able to sell to many other nations.
So competition in sort of international affairs, competition when it comes to national security, is foundational to our nation. And we understood that for more than 200 years. It was really only at the time of the sort of establishment of the WTO in the mid-1990s, the Uruguay Round and the GATT, that we actually sort of really stopped thinking about ways in which concentration of power and control abroad might affect our national security, our independence, our ability to act independently. And in the 25 years since the WTO system was established, we’ve seen this revolutionary restructuring, which has made us, as a nation, very unsafe, radically unsafe.
And so actually, my group, we work a lot on this issue. This is a direct outgrowth of our work on supply chain fragility, on industrial crashes. We’ve been working with the OECD in Paris on this issue. Our work actually influenced the G7 report on what to do about supply chains. It was a very imperfect report the G7 put out. We’re intending to make them make it better in their next iteration. We’re actually intending to sort of reimpose an understanding of how to use competition policy, competition principles, in the trade space, to radically increase America’s national security, but also to rebuild a functioning liberal international system.
TEDDY DOWNEY: And so I want to follow-up on the national security point. You still do see people in the U.S. point to the need for national champions as opposed to competition when it comes to defense. It still seems like the companies seem like that can still work with at least some people in the government. Are we at the point where that’s just really a nonstarter going forward? Or is that going to take a while for policymakers to overcome?
BARRY LYNN: You’re absolutely right. This has been true for more than 100 years. The monopolists always say, hey, we’re good for national security. We’re going to protect you from the Brits. We’re going to protect you from the Germans. We’re going to protect you from the Russians. We’re going to protect you from the Chinese. And we’ve got all these monopolists saying that right today. And it’s like it wasn’t true on day one of this country, and it sure as hell ain’t true today. It’s like most more than likely, the monopolists are going to do a deal with the foreign power because they want money. I mean, if anything, what we’re looking at right today, Google, Facebook, Amazon, Microsoft and Apple, it’s like their exposure to China is one of our fundamental sources of the threats that we now face as a nation.
So, if anything, having super large corporations in a global era and not properly regulating them or their activities or their relationships with foreign nations, it radically increases the threat to our democracy and to our independence. So the thing about this that’s really important for folks to understand, the Biden folks to understand this well, in the executive order, there’s a line in there. I
encourage people to read it. It says we don’t believe in national champions. Monopoly doesn’t protect national security. Competition does.
So again, once again, the White House is way out in advance of where most thinking is, where the press is, even where most of the Democratic Party is. This is a very smart administration. They know what they’re doing. And it’s kind of up to us, civil society, to provide them the support that they need to achieve these ends.
TEDDY DOWNEY: And we’ve got a question from the audience, and I think it fits a little bit what you’re saying. In what areas do you and the Biden Administration differ when it comes to your call for stronger antitrust enforcement? And how aligned are you with the Biden team on this issue? And I’d add to that question. Well, why don’t you just take a crack at that and then I’ll have a follow-up.
BARRY LYNN: Yeah, that was actually pretty simple. Because we don’t yet see much light between our position and the Biden administration on any area that we’re looking at. This could change over time as they begin to formalize a number of their positions. I’ll say this. One area where we think that we will be working with them to strengthen their understanding of the problem and of the potential solutions is on dealing with budget. What has been proposed thus far, it’s moving in the right direction, but it’s moving too slowly. And it is not showing any indication that there’s an understanding by people like Pete Buttigieg or the State Department of the magnitude of change that is necessary to sort of rebuild an international industrial system that is safe for America and all the world’s democracies. So that’s one area where there’s maybe some—but we don’t see that as there’s disagreement. We just see that as sort of an opportunity for learning.
TEDDY DOWNEY: And I do want to bring this point back though. Because you are in close agreement with the Biden team and leadership at the White House, but that’s not the whole government. And this gets back to the kind of practical point of achieving the results of these areas where you agree with the Biden team. They have to put people in place—I don’t like to use the term deep state—but the people who work in the government, a lot of them just don’t know about this issue. So I kind of want to bring it back up again just because it is interesting the mechanics of achieving these goals. They’re going to run into resistance, I would imagine, trying to pursue these goals.
BARRY LYNN: Yeah, absolutely. There’s going to be resistance up and down the chain. There’s resistance inside the FTC to some of the new ideas. There’s going to be resistance inside the DOJ. And some of this resistance is—I don’t even think that much of it is because of corruption. It’s really just people learned a certain way. This is the way it’s been for the last 30 years, the last 40 years. So it’s what I know. So I’m going to keep doing it. Or this moment is going to pass. This is
just a temporary change in the wind. But the prevailing wind that has prevailed the last 40 years will kick back in and that we’ll sail in that direction.
So there’s going to be resistance. There is resistance. But a lot of the resistance is just a lack of understanding of the magnitude of the problem and also just even understanding the true principles that people should be studying. It’s like for 40 years—let’s remember, for 40 years, more than 40 years in many cases—people have been, when you go to study economics in school, when you go to study international relations, when you study sociology, when you study political science, it’s like all of these academies have been deeply infused with sort of neoliberal thinking.
And so part of what we’re doing is we’re just actually awakening, you know, it’s like in all of these areas, people are awakening to their ability to use facts and reason and history to understand what they are faced with in terms of the crisis and understand how to deal with the crisis. And so, this is an amazing moment intellectually. It’s an awakening. And awakenings don’t happen all at once. Not everyone just opens their eyes and sees the same thing. It’s a matter of people passing on, helping one another, going from institution-to-institution, helping people see the light.
TEDDY DOWNEY: We’ve got a question here on the platforms. You say you want traditional common carrier regulation for the platforms, like what the FTC applied to phone companies. Are you saying that you want traditional common carrier regulation for the platforms like what the FTC applied to phone companies? Or apply the concept in new ways? And do you need legislation to do that? Or what agencies could do that type of platform common carrier enforcement?
BARRY LYNN: Yeah, that’s a great question. neutralization is achieved through a very broad array of laws and sort of programs. And these powers are widely dispersed. And we have within the antitrust the DOJ has essential facilities. People are about how effective that’s going to be. The FTC, through its rulemaking process, can really sort of regulate behaviors. But one of the main sort of ways that people have achieved certain forms of common carriers through resale price maintenance regimes. And within antitrust, that’s fighting words. We’re going to create this kind of rigidity.
And I think there’s a real misunderstanding of what RPM is. So there’s actually a lot of progressives who are extremely opposed to RPM. But RPM, going back to the mid-19th century was one of the main ways that people sort of restricted the power of the intermediary. This way is like the producer puts a price on a good, and the final seller of that price has to represent that price to the consumer, to the buyer. That means that you’ve taken away from all of the truckers and all of the trading companies and all the retailers in between, the ability to screw with the interrelationship between the producer and the buyer. And RPM was a major part of U.S. law for most of the 20th century.
And then it was disrupted for a period in the 70s and 80s. But you go back to Leegin, the Supreme Court said, yeah, this is legit.
So what we’re really looking at when we’re talking about common carrier pricing laws, laws and rules that limit the ability of the middlemen to screw with pricing, to screw with the terms of service. And basically, the idea is that if you’re a middleman, you provide service at a set price. And that way everyone knows what they’re getting. And therefore, you do not have any license to manipulate people, to extort people, when they’re trying just to get to the marketplace.
TEDDY DOWNEY: Well, I think we’ve covered a lot of ground. As always, fascinating, fascinating conversation. And congrats again on all of the success you’ve had recently. And thanks so much for doing this. And thanks to everyone for listening to the call.
BARRY LYNN: Well, I just want to say thank you, Teddy, and all the folks at The Capitol Forum. It’s like you guys were there very early on and you have been, in many ways, the steadiest and most farsighted institution covering these issues, the most farsighted team covering these issues for the last decade. And I just wanted to note what a great job you guys have done and what an important contribution you’ve made to the debate.
TEDDY DOWNEY: Thank you so much. I really appreciate it. And thanks again to everyone for joining the call. Have a good one.