Big News, But Maybe Not so Big?

Antitrust reform advocate Lina Khan was designated as Chair of the FTC last week, a few minutes after her confirmation vote. She was confirmed on a bipartisan Senate vote although President Biden's plan to name her the agency Chair was a secret until the announcement.

Khan's meteoric rise to the top of the antitrust world is astounding. She is 32 years old and a mere four years out of law school but in that short time has changed the debate around the proper scope and purpose of the law. She wrote her influential 2017 paper, Amazon's Antitrust Paradox, as a law student, and since then has worked at a progressive think tank, as a staffer on the House Antitrust Subcommittee and as an advisor to FTC Commissioner Chopra. She was an Associate Professor at Columbia Law School immediately before joining the Commission.  Her influence is now seen in multiple bills working their way through the House Judiciary Committee, although the legislation may not survive when it gets to the Senate. We will see. 

Khan and her fellow travelers advocate for a radical change in how the antitrust laws are applied and administered, or what my former antitrust law professor Bill Kovacic calls "root and branch transformation." They believe that antitrust law should encompass broader goals than consumer welfare, such as income inequality, protection of small business against the Amazons of the world, and a host of other social welfare values.

Khan's views may make for interesting political discussions but she's a long way from implementing her agenda in a lasting way. First, and most immediately, the Commission will be split 2-2 as soon as Commissioner Rohit Chopra is replaced, which may come soon. Chopra has been nominated to lead the Consumer Financial Protection Bureau and if the next FTC nominee is a traditional democrat, in the mold of former FTC Chairs Bill Pitofsky or Jon Leibowitz, that person will be the swing vote on cases. Second, as Chair of the Commission she is running a federal agency which comes with significant management responsibilities. Recall that she is 32 years old and nothing on her resume suggests she has the experience to be effective in that aspect of her role. Third, I predict the career staff will resist her admonition to put her vision into practice -- she advocates for bringing cases that are contrary to current law -- and no one likes getting yelled at by a federal judge. Fourth, and relatedly, the courts will emphatically reject her views. Just this week a unanimous Supreme Court decided NCAA v. Alston and reaffirmed the consumer welfare standard and other values that Ms. Khan is fighting against. 

Lina Khan's achievements are remarkable but she's a long way from having a lasting impact on antitrust doctrine. We will know more when Biden appoints someone to lead the DOJ's Antitrust Division and the open FTC position, but even if those people are ideologically sympathetic to Khan it won't be enough to change the law unless Congress steps in alter the substantive legal standards and reverse a lot of case law. The current bureaucracy and the courts will stand as significant impediments to her goals.