New Report: Reviving Antitrust for the 21st Century Economy
September 25, 2018
Roosevelt Institute and Great Democracy Initiative Release Legislative Blueprint for Combating the Second Gilded Age
NEW YORK, NY – As concentrated corporate power threatens jobs and wages and worsens inequality, the Roosevelt Institute and the Great Democracy Initiative (GDI) today released two new papers outlining a progressive framework to reform America’s failing antitrust system. Addressing key elements of the growing monopoly problem, the first report argues for taking antitrust policymaking out of the courts and empowering antitrust enforcers, while the second offers an alternative to the outdated consumer welfare standard, along with policy solutions to increase competition and protect workers and consumers. Together, the papers provide a progressive blueprint for a robust 21st century antitrust regime that can begin to address the United States’ market power crisis.
In Taking Antitrust Away From the Courts: A Structural Approach to Reversing the Second Age of Monopoly Power, Ganesh Sitaraman, Director of Policy and Co-Founder of the Great Democracy Initiative, explains the problems with court-established antitrust policy and outlines a set of institutional reforms to the Federal Trade Commission in order to reinvigorate antitrust policymaking. In shifting the policymaking role from judges, who have eroded existing regulations, to agency experts, Sitaraman recommends a series of bold policy reforms, including a newly empowered anti-monopoly agency, new standards and practices for merger evaluation, and expanded third party enforcement.
“Antitrust laws are only as good as their implementation and enforcement,” said Ganesh Sitaraman, Director of Policy and Co-Founder of the Great Democracy Initiative, and a Professor of Law at Vanderbilt Law School. “As our growing market power problem demonstrates, leaving antitrust policymaking to the courts does not work. We need a strong antitrust agency with the authority to take action that promotes competition and addresses market concentration.”
A second paper, The Effective Competition Standard: A New Standard for Antitrust, tackles the dangerous implications of the ambiguous and inadequate consumer welfare standard. Authored by Roosevelt Institute economist Marshall Steinbaum and Maurice E. Stucke, a Professor of Law at the University of Tennessee, the report argues in favor of a new effective competition standard. If adopted, this framework would protect competition in the economy, including in the labor market and throughout supply chains, by meeting several essential goals:
- to protect individuals, purchasers, consumers, and producers;
- to preserve opportunities for competitors;
- to promote individual autonomy and well-being; and
- to disperse and de-concentrate private power.
“The current antitrust standard is not working. Market power and monopsony have been growing in our economy for decades and are a major factor driving wage stagnation and decreasing worker protections,” said Marshall Steinbaum, Fellow and Research Director at the Roosevelt Institute. “Antitrust enforcers need tools to hold corporate power accountable and to better prioritize the interests of consumers and workers.”
The Roosevelt Institute has been a leading voice on antitrust policy and the need for bold policies to tackle market power. Roosevelt Chief Economist Joseph E. Stiglitz recently called for a new standard for antitrust during his keynote address at the ongoing FTC competition hearings. In 2018, the Roosevelt Institute released Powerless: How Lax Antitrust and Concentrated Market Power Rig the Economy Against American Workers, Consumers, and Communities, which outlines the 40-year assault on antitrust and competition policy. In 2018, Steinbaum also authored an issue brief titled A Missing Link: The Role of Antitrust Law in Rectifying Employer Power in Our High-Profit, Low-Wage Economy, which chronicled the ways the market power crisis is limiting worker power, depressing wages, and harming the economy. The Great Democracy Initiative has also championed progressive solutions to today’s skewed economy. In 2018, GDI released Regulating Tech Platforms: A Blueprint for Reform, which identified ways to break up and regulate technology platforms.
About the Roosevelt Institute
Until the rules work for every American, they’re not working. The Roosevelt Institute asks: what does a better society look like? Armed with a bold vision for the future, we push the economic and social debate forward. We believe that those at the top hold too much power and wealth, and that our economy will be stronger when that changes. Ultimately, we want our work to move the country toward a new economic and political system: one built by many for the good of all.
It takes all of us to rewrite the rules. From emerging leaders to Nobel laureate economists, we’ve built a network of thousands. At Roosevelt, we make influencers more thoughtful and thinkers more influential. We also celebrate—and are inspired by—those whose work embodies the values of both Franklin and Eleanor Roosevelt and carries their vision forward today.
About the Great Democracy Initiative
The Great Democracy Initiative develops policy blueprints that offer solutions to the most pressing problems of our time. From taming the concentration of power in our economy to fundamentally reforming our broken government, GDI aims to generate policy ideas that confront the forces that have rigged our society in favor of the powerful and connected.