For antitrust doves—those of us who think antitrust works best with a restrained approach to policing competition—the U.S. midterm results look, at first glance, like a triumph for the hawks.
Democrats have won control of both chambers of Congress, with at least 54 Senate seats and potentially their largest House majority in nearly two decades. Cue visions of chief executives facing congressional subpoenas, revived bills targeting Big Tech, and renewed pressure on the Federal Trade Commission (FTC) to take a harder line.
But the outlook differs sharply between Washington and the states. In Congress, a new majority creates opportunities for more aggressive antitrust policy, though turning proposals into law remains uncertain. State efforts, by contrast, were already underway well before Election Day. The midterms could give them fresh momentum—and that’s where the more consequential changes may lie.
More Subpoenas Than Supremacy
The midterms give Washington’s antitrust hawks more power to investigate than to legislate. Congressional Democrats can now issue subpoenas and block nominees, but major legislation still needs President Donald Trump’s signature or two-thirds majorities in both chambers to override his veto. Bipartisan support for Big Tech bills may fall short of that threshold.
The election is unlikely to change who controls the enforcement agencies, either. In Trump v. Slaughter, the Supreme Court struck down limits on the president’s power to fire FTC commissioners. The commission will remain under Republican control, likely with only two or three commissioners, and Trump will continue to direct the U.S. Department of Justice (DOJ).
Expect more action at congressional hearings. Sen. Ed Markey (D-Mass.) quipped as the results came in that tech executives will need to “plant new forests for all of the subpoenas we’ll be printing.” Scrutiny of alleged political influence over antitrust enforcement could serve a useful purpose. But a louder Congress won’t necessarily produce a different federal antitrust policy. The states have a clearer path.
The Hawks Go Local
The antitrust hawks were gaining ground in Sacramento and Albany well before Election Day. The midterms give them more room to act for three reasons.
First, Democrats made sweeping gains in statehouses. They won new trifectas—control of the governorship and both legislative chambers—in Michigan, Minnesota, Nevada, Pennsylvania, and Wisconsin. They also flipped the Arizona legislature, appear poised to take the Texas House, and won five closely watched races for state attorney general, including in Texas.
Second, Washington is unlikely to intervene. A divided federal government has little prospect of passing legislation that overrides state antitrust or tech laws. And after Slaughter, state attorneys general are the only antitrust enforcers in the country insulated from presidential removal.
Third, the sales pitch practically writes itself. Advocates already claim that California’s new law governing single-firm conduct—business practices that don’t require an agreement among competitors—“sets the stage for California to take over antitrust leadership in the U.S.” Expect lawmakers elsewhere to borrow both the policy and the pitch.
The Antitrust Copycat Kit
States already have a menu of proposals to choose from.
Start with single-firm conduct. California’s COMPETE Act, signed Sept. 30 and effective Jan. 1, extends the Cartwright Act, the state’s principal antitrust law, to unilateral conduct by firms with “substantial market power.” The statute doesn’t define that term and treats federal precedent as “at most instructive.” The law therefore exposes businesses to more antitrust claims while giving them less guidance about which practices cross the line.
New York’s Twenty-First Century Antitrust Act would go even further. The current bill would presume dominance at a 40% share of sales or 30% share of purchases in a relevant market and permit corporate penalties of up to $100 million. It would also presume certain practices by dominant firms unlawful, subject to a demanding defense requiring clear and convincing evidence that their competitive benefits are achievable only through the challenged conduct and outweigh its harms. The bill passed the state Senate in May and remains in an Assembly committee.
States with new trifectas could follow. Minnesota bears watching under Gov.-elect Amy Klobuchar, who spent years championing the American Innovation and Choice Online Act, a federal bill that would restrict large platforms’ ability to favor their own offerings.
Then there are the inevitable state merger-review issues. Washington state and Colorado adopted laws in 2025 requiring companies to notify state officials before certain mergers. California’s version takes effect Jan. 1, 2027. Indiana, New York, the District of Columbia, Hawaii, and West Virginia have considered similar bills.
While notification gives states an earlier look at deals, stricter legal standards could give them more grounds to challenge those deals. The California Law Revision Commission is already weighing proposals to impose liability for an “appreciable risk” of harm to competition, write presumptions based on market concentration from the federal agencies’ 2023 Merger Guidelines into law, and shift the burden of proof to merging companies. Those changes could make it easier to block mergers based on predictions of harm and market shares, leaving companies to prove their deals should proceed.
Then come platform and algorithm rules. California’s Blocking Anticompetitive Self-preferencing by Entrenched Dominant Platforms (BASED) Act died in committee in April. It would have presumptively banned “self-preferencing”—favoring a platform’s own products or services—by platforms with market capitalizations above $1 trillion. A federal court has partly blocked New York’s restrictions on landlords’ use of software-generated rental recommendations on First Amendment grounds. Both ideas could resurface elsewhere.
Finally, new attorneys general will put these powers to work. Of course, party labels offer an unreliable guide to tech enforcement. Texas has long led multistate litigation, including against Google, and incoming Attorney General Nathan Johnson has promised to refocus on consumer protection. But give new state enforcers broader statutes and open-ended standards, and they’ll have considerable discretion to set their own agendas.
Fifty Ways to Chill Competition
The case against this state-level expansion begins with a mismatch between increasingly divergent state laws and a national economy.
Many firms serve markets that cross state lines. A state injunction can halt a nationwide deal, allowing California’s standard to become the national standard without national accountability. Conflicting rules can also force firms to choose which state to obey. Alden Abbott has argued that California’s approach raises serious constitutional questions about state interference with interstate commerce under the dormant Commerce Clause, as well as whether federal law overrides it.
Departing from federal precedent sacrifices useful guidance. Federal monopolization doctrine reflects a century of litigation and economic learning about when discounts, refusals to do business with rivals, and product design harm consumers. Practices that hurt competitors can still benefit the people buying their products. Courts need workable standards for telling the difference.
COMPETE does retain safeguards. It directs courts to use the California Supreme Court’s framework in In re Cipro Cases I & II and recognizes that firms may lawfully gain or maintain market power through superior products, services, or business acumen. The uncertainty concerns how courts will apply that framework to single-firm conduct, what “substantial market power” means, and how far California will depart from federal standards.
Even California Gov. Gavin Newsom acknowledged when signing COMPETE that “additional legislation may be required to clarify the appropriate standards.” Businesses, apparently, should stay tuned. Meanwhile, uncertainty has costs. When the line between vigorous competition and illegal exclusion blurs, firms may pull back. Consumers lose the price cuts and product improvements that never materialize. The International Center for Law & Economics (ICLE) examines these concerns in its analysis of the law.
The merger proposals would turn disputed enforcement policy into binding law. Federal merger review already uses market shares, predictions of harm, and rebuttable presumptions. The concern is that California would lower the thresholds for presumed illegality, make those presumptions harder to rebut, and lock the approach into statute.
Agencies can revise merger guidelines as evidence and experience develop. Statutory thresholds require another round of legislation. A more restrictive regime could deter mergers that benefit competition, including acquisitions that let startup founders and investors sell their stakes and fund new ventures, as ICLE explained to the California Law Revision Commission in August.
It’s also important to consider who gets the discretion. Congressional hearings are likely to scrutinize political influence over federal merger review. Yet these state proposals hand open-ended standards to elected attorneys general, who face political incentives of their own. COMPETE reserves enforcement of its new single-firm provisions to the attorney general and district attorneys. Clearer rules would help constrain political influence, while broader discretion gives it more room.
Finally, proponents should explain why existing enforcement powers are inadequate. California’s stated rationale for COMPETE is that the Cartwright Act previously required multiple firms, leaving prosecutors to rely on federal law for monopolization claims. That identifies a difference in statutory coverage but doesn’t establish which harmful practices existing state and federal tools leave beyond effective enforcement.
The same question applies to merger proposals. California’s attorney general, for example, sued under the existing federal Clayton Act to block Nexstar’s acquisition of Tegna. Before adopting broader liability standards, proponents should identify harmful transactions the current standards prevent them from challenging successfully.
States have plenty of useful work to do. They should anchor their laws to federal precedent, require proof of durable market power, and let businesses defend practices by showing how they improve efficiency and benefit competition. Those safeguards help ensure that winning customers by offering something better remains lawful.
States should also concentrate on local markets—hospitals, groceries, and local employment—where their detailed knowledge may improve enforcement. Before expanding their laws, they should publish an impact assessment identifying harmful conduct existing law can’t reach and explaining how the proposed changes would address it. Failing to establish that enforcement gap remains a problem with the European Union’s Digital Markets Act. States should learn from that experience and keep antitrust focused on consumer welfare.
The same concern for competition should inform permitting rules. Voters sided against data-center development in all but one of 41 related ballot measures across 10 states. Some imposed restrictions, while others were advisory. Communities have legitimate concerns about electricity, water, and land use. But restrictions adopted or encouraged by those votes could also make new computing capacity harder to build, leaving existing capacity scarcer and more valuable—a helpful arrangement for the incumbents the hawks worry about.
Antitrust Leaves the Nest
Put it all together, and the midterms’ federal consequences look far less certain than they first appear. Congressional Democrats gain subpoena power and the power to block nominees, but the agencies look set to remain under presidential control, and divided government makes major legislation difficult.
The states are a different story. California’s COMPETE Act takes effect in January, new trifectas and attorneys general are looking for agendas, and Washington is unlikely to stand in their way. For antitrust doves, that’s where the argument now needs to be made.
In Washington, the hawks have more squawk than lift. In the states, they’ve already taken flight.
