Project Syndicate’s Big Question asked Open Markets policy counsel Tara Pincock and several other experts “whether current antitrust law is fit for purpose, and if not, how it needs to change.” Pincock’s response:

TARA PINCOCK:

US antitrust laws, as written, are broad enough to cover a wide range of unfair competition practices. But over the last 40 years, the courts have interpreted and applied these laws in ways that favor Big Business and have significantly limited their scope and effectiveness. While the laws themselves remain fit for purpose, we need the courts to interpret them as Congress intended. If the judiciary is unable or unwilling to do so, it falls to Congress to amend the laws to correct the courts’ errors.

Prior to US President Ronald Reagan’s administration, the courts largely interpreted antitrust laws in accordance with congressional intent. But beginning in the 1980s, they adopted the consumer welfare standard, under which corporate consolidation is viewed as “bad” only if the reduction in competition leads to demonstrably worse outcomes for consumers (such as higher prices or lower quality). The courts are not solely to blame, though. The federal agencies charged with enforcing antitrust law have also been lax in their duties.

But antitrust-enforcement agencies – that is, the Federal Trade Commission and the Justice Department’s Antitrust Division – have recently wised up. In recent years, they have adopted a more aggressive stance, seeking to hold major corporations accountable for their anticompetitive practices and to block mergers and acquisitions in sectors that are already highly concentrated.

While it often feels like antitrust enforcers are fighting a losing battle against the courts, there are glimmers of hope, particularly at the district-court level. For example, Google was recently found liable for its anticompetitive conduct in online search. The crucial question is whether these enforcement victories will be upheld on appeal.

Congress, too, has recognized that there is a problem, with legislators introducing several bills that, if passed, could help put antitrust enforcement back on course. If we continue in this direction, there is a strong chance that antitrust laws will regain their original strength and purpose. If not, antitrust could become a dead letter.