New Paper: Failings of Khan’s Radical Economic Agenda
Author: Tom Spencer
Paper: An analysis of Lina Khan’s treatment of vertical integration
Lina Khan’s reckless pursuit of “reforming” the FTC is guided by her belief that the agency needs “bold leadership willing to use the full breadth of its expansive authority.” The “bold” approach that she has theorized about for over five years turns out to be a cold disregard for bipartisan limits on government power. Khan’s blind pursuit of her radical agenda is willingly ignoring the commissioners outside of the temporary Democrat majority, the perspectives of other scholars, and the will of the public. In this pursuit, the FTC’s integrity is crumbling before our very eyes.
In a new paper from Tom Spencer in coordination with Digital Liberty and Young Voices, he shows that her agenda fails in multiple ways including:
Khan understates the efficiency benefits of vertical integration
The precedents Khan cites are misleading and fail to account for pro-integration judgements that followed the passing of the Sherman Act
Khan fails to provide a convincing argument about why consumers should accept higher prices
The ideas promulgated by Lina Khan are at odds with the economic consensus as it has existed in the last 50 years. New ideas do bring benefits from time to time, but where that change will bring about lesser investment, innovation, choice and higher prices to American consumers, then it must be avoided. With giants of antitrust like Herbert Hovenkamp describing her work as “technically undisciplined, untestable, and even incoherent”[1], it is clear just how damaging it is to have someone so radical in such an important position of power. America is lucky that the Courts will resist overzealous bureaucrats, because if not the harm that Lina Khan’s FTC could do would be significant.
The plight of the structuralist, new-brandeisians or hipster school of thought is to answer Henry Manne’s famous question, ”Why should the government, and sometimes incumbent management, be using the antitrust laws to block mergers that the market, by the existence of willing buyers and sellers, demonstrates to be desirable”.[2] Lina Khan has failed to do that, and until she does her efforts to reform vertical integration law must be resisted.
Photo Credit: Associated Press