Welcome to the Truth on the Market FTC UMC Roundup for May 27, 2022. This week we have (Hail Mary?) revisions to Sen. Amy Klobuchar’s (D-Minn.) American Innovation and Choice Online Act, initiatives that can’t decide whether they belong in Congress or the Federal Trade Commission, and yet more commentary on inflation and antitrust, along with a twist ending.
This Week’s Headline
Sen. Klobuchar has shared a revised version of her proposed American Innovation and Choice Online Act. What’s different? Not much. The main change is that several industries—banks and telecom, notably—are excluded from coverage. That was probably an effort to win some Republican votes for the bill. But headed into the midterms. it appears some congressional Democrats view this more as a poison pill than a good bill—one they don’t think their constituents are willing to swallow.
Back at the FTC, the commission has announced that it will investigate the recent shortage of infant formula. This could focus on both consumer protection and competition issues. The market for infant formula in the United States is both fairly concentrated and also highly regulated. There are lots of interesting issues here (reminder to any academics reading this, we have an open call for papers for research relating to market-structuring regulation).
The blurry line between FTC and Congress remains blurry. The FTC’s call for comments relating to pharmacy benefit managers (PBMs) closed this week, with more than 500 comments, at the same time that bipartisan legislation relating to PBMs has been introduced. And Sens. Mike Rounds (R-S.D.) and Elizabeth Warren (D-Mass.) want the FTC to investigate price fixing in the beef industry.
Concentrating a bit on big-picture policy issues, the number of friends Larry Summers has in the White House is shrinking faster than the dollar, as he worries about the embrace of “hipster antitrust,” including that the administration’s antitrust policy is driving inflation. On the other side of the inflation-antitrust ledger, economists at the Boston Federal Reserve Bank released a paper arguing that high concentration increases inflation. Among others, ICLE Chief Economist Brian Albrecht calls foul. Still on the inflation beat, it’s no secret that the biggest tech companies hold a lot of cash. Some may wonder, with the cost of holding cash so high, is a buying spree on the horizon? (Answer: not if the FTC keeps holding up mergers!)
A Few Quick Hits
Former FTC Commissioner Josh Wright and former commission staffer Derek Moore reflect on FTC morale. And Howard Beales and former FTC Chair Tim Muris wonder whether the “national nanny” is back on the beat.
It’s consumer protection, not antitrust, news but Twitter has been hit with a $150 million fine for doing bad stuff with user data between 2013 and 2019. Perhaps DuckDuckGo will be up next for the FTC. It turns out that the browser built on promises that it doesn’t track you has a deal with Microsoft to let Microsoft track you. That gives us an excuse to mention the FTC’s call for presentations for PrivacyCon 2022.
In international news, the United Kingdom’s Competition and Markets Authority has opened a second investigation into Google’s AdTech practices. And Shane Tewes of the American Enterprise Institute has a nice discussion with Peter Brown from the European Paliament’s liaison office about American versus European approaches to technology policy.
We close with a twist ending: One of the concerns that critics of the FTC’s newfound embrace of its UMC authority have is that expansive vague authority given to regulators enables a flabby useless government that is paradoxically too powerful. Which is why it’s interesting to see Matt Stoller of the American Economic Liberties Project, of all people, express that concern. Strange bedfellows indeed!
The FTC UMC Roundup, part of the Truth on the Market FTC UMC Symposium, is a weekly roundup of news relating to the Federal Trade Commission’s antitrust and Unfair Methods of Competition authority. If you would like to receive this and other posts relating to these topics, subscribe to the RSS feed here. If you have news items you would like to suggest for inclusion, please mail them to us at firstname.lastname@example.org and/or email@example.com.