Corporate Mergers Are Under Attack, But Not on Your BehalfVeronique de Rugy
Aug 18, 2023
Last month, the Department of Justice (DOJ) and Federal Trade Commission (FTC) published a draft of proposed new guidelines for mergers and acquisitions. Sounds like a problem reserved for people who sit in board rooms, right? Not exactly. Such rules will affect all of us.
If implemented, the proposal will preemptively block private-sector corporate transactions with little regard for the actual impact on consumers. This power grab by progressives in the Biden administration would shift antitrust law from standards that corporations and courts can understand to a series of vague and ambiguous "guidelines" that only give bureaucrats greater power over corporate America.
Despite the common handwringing over corporate mergers and acquisitions, they should be subject to free market forces. And if there is a role for the government to superintend mergers, the guiding standard should be consumer welfare -- the prices we all pay, as well as the quality and quantity of the products being made available to us -- rather than politicians' belief that bigger equals bad or the perception of unelected officials that all mergers are problematic.
Yet as explained by my colleague Alden Abbott, a former Federal Trade Commission general counsel, the proposal reads as "an anti-merger manifesto."
The project is driven by controversial FTC Chair Lina Khan and designed to greatly enlarge government-erected barriers to mergers and acquisitions. In doing so, the guidelines would ignore decades of counterintuitive academic findings about how firm concentration can have a positive impact on consumers' welfare.
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Source:
https://townhall.com/columnists/veroniquederugy/2023/08/18/corporate-mergers-are-under-attack-but-not-on-your-behalf-n2627198
