June 18, 2025 • 63 mins
On April 9th, President Trump signed E.O. 14267, Reducing Anti-Competitive Regulatory Barriers, which “commences the process for eliminating anti-competitive regulations to revitalize the American economy.” The order instructs the agency heads to review all regulations that may stifle economic competition or impose restraints on the free market. Many applaud the order, arguing that it addresses an overburdened economy, while others question the necessity of government regulation for ensuring a fair and just market.
What does President Trump’s order mean for the future of the economy and the laws that regulate it?
Featuring
Alden Abbott, Senior Research Fellow, Mercatus Center, George Mason University
Charlie Beller, Counsel to the Assistant Attorney General, Antitrust Division, U.S. Department of Justice (DOJ)
Kathleen Bradish, Vice President and Director of Legal Advocacy, American Antitrust Institute
Moderator: Bilal Sayyed, Senior Adjunct Fellow, TechFreedom
What does President Trump’s order mean for the future of the economy and the laws that regulate it?
Featuring
Alden Abbott, Senior Research Fellow, Mercatus Center, George Mason University
Charlie Beller, Counsel to the Assistant Attorney General, Antitrust Division, U.S. Department of Justice (DOJ)
Kathleen Bradish, Vice President and Director of Legal Advocacy, American Antitrust Institute
Moderator: Bilal Sayyed, Senior Adjunct Fellow, TechFreedom
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Regulation after regulation. There are dated regulations that need to
be changed.
Speaker 2 (00:05):
One hundred and eighty five thousand pages.
Speaker 3 (00:08):
Now public accountability and transparency. There will be no public supports.
Speaker 4 (00:13):
It's really the best we can do. There's a regulation
that doesn't make any sense.
Speaker 2 (00:16):
Why do you keep you know who wrote the regulatory
laws you must comply with. Welcome to the Regulatory Transparency
Project's fourth Branch podcast series. All expressions of opinion are
those of the speaker.
Speaker 5 (00:33):
Good afternoon, everyone, and welcome to today's Regulatory Transparency Project
webinar titled Reducing Regulatory Barriers the Future of Market Competition.
We're so glad that you're able to join us today.
My name is Lippy Dickinson, and I am the assistant
director with the Federalist Society's Regulatory Transparency Project. As a reminder,
all opinions expressed are those of the speakers and not
(00:53):
of the Federalists Society. We're honored to be joined today
by an excellent panel of legal and antitrust experts addressing
proposals of President Trump's recent executive order concerning the production
of anti competitive regulations and what it will mean for
market competition. After the panel discussion, there will be a
short period designated for audience questions. We ask that you
(01:14):
submit them via Zoom's Q and a feature not the chat,
and that they are pertinent to the topic at hand.
In order to get right to the discussion, I'll start
by briefly introducing each panelist and then hand things over
to our moderator to start the conversation. Our panel today
includes Aldon Abbott, Senior Research Fellow at the Mercadis Center
with George Mason University, Charlie Beller, Counsel to the Assistant
(01:35):
Attorney General Anti Trust Division with the Department of Justice,
and Kathleen Bradish, the Vice President and Director of Legal
Advocacy at the American Anti Trust Institute. Our moderator today
is bellaal Sayid, a Senior Adjunct Fellow at Tech Freedom.
You can find out more about today's moderator and panelists
at Federalists at the Federalist Society website fedsock dot org.
(01:58):
That is fedsock. With that, and we'll hand things off
the below to get us started. Thank you so much
for joining us today.
Speaker 4 (02:05):
Below. Thank thank you Liby, and thank you for pople
both for joining and of course thank you to our panelists,
so you know. Pursuing to Executive Order one four two
sixty seven, the Administration has tasked east agency within the
executive branch of the federal government, and any independent regulatory
(02:25):
agency to identify and recommend the modification or recision of
any regulation for which they have rulemaking authorities that creates
or facilitates the creation of the facto or the jury monopolies,
creates unnecessary barriers to enter it for the market participants,
limits competition between competing entities, or has the effect of
(02:47):
limiting competition between competing entities, create so facilitates licensure or
accredation requirements that unduly limit competition, that unnecessarily burdens the
agencies curement processes, or otherwise imposes anti competitive restraints or
distortions on the operation of the free market. Prior to
(03:08):
the administration's executive order, the Department of Justice had announced
an Anti Competitive Regulations Task Force that will advocate for
the elimination of anti competitive state and federal laws and
regulations that undermine free market competition and harm consumers, workers,
and businesses. And shortly after the executive order, the FDC
(03:31):
sought comment from the public on federal regulations that exclude
new market entrants, protect dominant incumbents, and predetermined economic winners
and losers. So what we have is a well, what
we have is the FTC with the Department of Justice
sort of taking leadership of what you might call a
whole of government approach to federal regulatory review, and of
(03:55):
course the FDC and DOJ perhaps advocating at the state
level for a moval of anti competitive regulations. So you know, Charlie,
you are the representative from the Apartment of Justice on
this panel, So can you describe the scope of the
initiative in response to the presidents and secutive order.
Speaker 1 (04:17):
Sure, and I'll start thanks first to the thought our
Society for doing the panel, and to my fellow panelists.
I'll start with a normal caveat that my comments are
my own, not visit the administration, the DJ or the AGE.
And I think, as you notable all there's sort of
there's the EO just for those that are less in
the weeds than all of the panelists here. There's the EO,
(04:40):
which is one of many, and then there's the Anti
Competitive Regulations Task Force, which is initiative specifically of the
Department of Justice, which I can speak to, and there's
a parallel initiative from the FTC, so that's sort of
the broader context. I think it's helpful, given sort of
the high level, to even take a further step back
(05:02):
to think a little bit about the history and context
in which they starre occurring, because I think it's important
from the divisions perspective, from my perspective at the division,
for how we're thinking about things. And I like the
adage from Oliver one of Holmes that a page of
history is worth a pound of logic, and I think
that's particularly relevant here. In the last Trump administration, there
(05:24):
was a similar regulatory review effort by Magan del Raheem,
who is the Age and Trump forty five that goes
into some details about the history. I think the most
relevant pieces being that really since the mid century and
the starting the Nixon administration, there was a concern about
(05:48):
the impact that the New Deal style regulations were having
on the US economy. That bled into the Carter administration
regulator regulatory reform efforts, most important there being the Airline
Deregulation Act, and then we saw in the Reagan sort
of an institutionalization of regulatory reform with AHIRA and then
(06:10):
further deregulatory efforts in the first Push and Clinton administrations.
I like the ADA and the Carter administration ADA as
a sort of paradigm for anti trust and deregulatory efforts.
And there's a story that, if you'll indulge me, I'd
like to tell it probably will be familiar to a
lot of folks in this group. Because of the National
(06:33):
Fed Sock Lawyers Convention. Last November, Justice Briar and Justice
Gorsitch had a sort of a sit down conversation, and
Justice Brier was talking about his time in working for
Ted Kennedy on airline deregulation. Justice Brier is an anti
trust expert. He actually sat in my seat here at
the Anti Trust Division as a council and so he
(06:56):
knew a thing about anti trust deregulation. And the up
out of that conversation was that anti trust is a
critical backstop to any deregulatory impetus. And so I think
that I think is really important is that there can
be regulatory efforts, but under public choice theory, right, if
you've remove the regulatory barriers and let the free market
(07:18):
solve the problems, anti trust becomes increasingly important as a
backstop to that private market sorting and competition that ideally
comes in and replaces the regulatory apparatus. So I'll stop there,
look forward to hearing thoughts from my fellow panelists. But
I thought sort of just having a brief history as
(07:41):
well as the broader political block stop would be helpful.
Speaker 4 (07:47):
All right, Thank you, Charlie. And I'll note as you noted,
of course, said Kennedy and Stephen Brier were instrumental in
President Carter's deregulatory effort. UH. And you know Jim Miller
and uh and also Tim Yurras who both at different
times became chairman of the FTC.
Speaker 6 (08:09):
UH.
Speaker 4 (08:10):
We're part of the White House, is the Reagan White
House is task force on regulatory reform right out of
the right out of the starter President President Reagan's presidents.
But anyway, let me let me, let me turn to
Kathleen and ask, you know, the FDC and d o
J have been aggressive players right over the last forty
(08:34):
fifty years. UH in a deregulatory effort. Charlie described a
little bit of bit, what what do you think are
there areas that the FTC and d O J should
be focusing on UH during this administration. You know that
that sort of aligns with the with with the push
for removing regulatory barriers to competition.
Speaker 6 (08:58):
Yes, and I will also thank the Federal Society and
my panelists for participating today. So I think, to answer
your question, the FTC and the DJ have an incredibly
important role in avoiding and eliminating anti competitive regulation. They
are the ones that have the skills and the experience
(09:21):
to assess the competitiveness of markets, and they I believe
can spot issues that other agencies may not be able to.
They have also had the experience collecting and working with
evidence to assess justifications like privacy, safety, et cetera that
are typically offered by parties when they seek market restrictions.
(09:44):
They do this as part as a part of their
day to day job, and it's they makes them very
well suited for this part of the project. And an
example of that is the FTC recently filed an amikas
brief in the Google Search case debunking privacy justifications that
(10:06):
have been raised by Google. So in that respect, their
role as an interagency advisor is really really vital. I
saw this firsthand when I was at DOJ and served
on the trade committees, the interagency trade committees. A lot
of that doesn't necessarily get seen by the public all
(10:27):
the time, but it may be one of the most
powerful roles that they have. And I hope that this
executive order serves as a means to really open the
doors of communication among the agencies. And I think it
can be really a good point of continuity between the
work done in the Biden administration with the whole of
government approach to competition and this administration. SO and Psychondolgic
(10:54):
put in a brief pitch for the FDC's powers to
conduct more market studies. This is something I think it
can be essential to this project. I think of the
Pharmacy Benefit Manager study for example, and it's part of
what makes FTC different than the DOJ and gives it
(11:15):
extra tools in its toolbox. SO and finally, on the
state regulation side, FTC and DJ have a really important
role in advocating advocating against anti competitive regulations on the
state level, advising state legislatures and sometimes going into court
when self regulating bodies. I think of teeth whitening and
(11:38):
teledanderistry come to mind. Put in place self serving and
restrictive conditions. In terms of areas where this can matter,
I think market concentration can help lead the way to
the problem areas. FTC and DJ can help identify errors
of our concentration is very high areas where it has
increased substantially in recent years, and really look for the
(12:00):
role that regulation might be playing there. I look through
some of the comments to the DOJ and FTC RFIs
on this and I see a lot of concern about
healthcare consolidation, for example, at various different levels, and that
raises questions about limitations, for example, about rules that may
(12:21):
be creating healthcare deserts in rural and low income communities,
or reimbursement schemes that may be in favoring favoring incumbents
over a new entrance. Just as another area, agriculture, I
see it. I see that a lot in the comments.
There is tremendous consolidation in meat packing and there and
(12:42):
for example in seeds is another area genetically modified seeds,
so there it's worth looking at restrictions on independent slaughter houses,
for example, and at the Plant Variety Protection Act to
see whether those are getting the balance of safety and
protecting innovation and competition. Right, So I think where you
(13:04):
have two or three or four players like makepacking and
cenetically modified seas, I think there's a presumption that something
is not working in regulation maybe playing a role in that.
Speaker 4 (13:16):
Yeah, that's that's interesting. I mean the agencies I think
did identify a few sectors where where they were going
to focus or might focus their efforts, and of course
healthcare and agriculture, energy, I think real estate markets.
Speaker 1 (13:34):
So I'm happy to jump in there quickly and then
we can let out and you know, vers be responses too.
But I just wanted to note on that that because
two of those industries are areas where the AGE specifically
identified I believe in the context of the Anti Competitive
Regulations task Force agriculture and healthcare. I talked a little
bit about airlines before, so transportation is already something that
(13:57):
has sort of a long legacy of deregulatory but I
think agriculture and healthcare less.
Speaker 4 (14:01):
So there are.
Speaker 1 (14:04):
Obviously pocketbook issues and that's an area of concern for
for the for enforcers generally, but I think it also
fits them with public choice literature. Right, these are industries
where you do not have the type of institutional interest
to push back on regulation, and so it fits very
nicely with the largest theoretical backdrop of why we're doing
(14:25):
this work. And that's I think kind Ofthen's point particularly
cute in healthcare where the average consumer of healthcare just
does not be able to push back, like maybe the
case in transportation or other industries where there's industry larger industries.
Speaker 4 (14:42):
So so Charlie, I'll just I'll just pick up on
that before I before I turned to Alden, and maybe
Olden can wain as well. I mean, is it is it?
Is it? Do you think of concern particularly the Justice Department,
but maybe also the SCC that agency is like you know,
Agriculture and HHS and either Department of Transportation or the
(15:07):
Surface Transportation Board. I mean you mentioned public choice. Is
there a concern these agencies have sort of been captured
and that you know, the FTC and do J has
to be maybe a little more public in their in
their pushback on the regulatory framework that that those folks
(15:27):
have both sort of adopted but maybe failed to uh
to manage in a way that does not that does
not protecting companies.
Speaker 1 (15:39):
I can't speak to the first point, But I think again,
I would just sort of think about it from the
perspective of the first principles of public choice theory. Right,
these are areas in which consumers and interest there are
not sort of organized interest groups, and so I'm not
sure I can speak to the first the specific question,
(16:00):
but I think the way I'm looking at it sort
of answers the same question, which is, there are going
to be industries in which consumers do not have the
ability to organize, and those could be areas where antitrust
deregulatory efforts are particularly important. I think some of the
ones that Kathleen pointed to me are frinding examples of that,
and those are the ones that the is this Attorney
(16:21):
General has also identified.
Speaker 4 (16:24):
So so Alden, let me let me get you in here.
Any any reactions so far, It's what we've heard so
far from either Kathleen or Charlie. I mean, you know,
you and and a colleague put in at a very
good comment to the FTC, and I want to turn
to that later, but I just wonder if you've got
(16:45):
reaction to, you know, the areas that that Kathleen mentioned
and Charlie mentioned, maybe you can also pick up on
the public choice stuff.
Speaker 3 (16:55):
Yeah, so I think this is all very helpful, and
thank you to Federal Society for inviting me. I'll just
been mentioned in passing. I held a job Charlie currently
holds in nineteen eighty four to eighty five at DOJ,
except in those days it was called specialist system to
the Assistant Attorney General instead of counsel. Counsel sounds a
lot fancier, I think, But anyway, yeah, public choice. I
(17:19):
think there's a specific example of that one. Some of
the restrictions are in agriculture, something called agricultural marketing orders
overseen by the Agriculture Department, which basically limit apply to
certain crops, especially certain fruits, and they limit the production
(17:41):
and it has allow informal quotas to be established and
set prices. Very anti competitive. It seems cartel like. And
these agreements are overseen, their industries involved in drafting them,
but overseeing by the Agriculture Department and.
Speaker 6 (17:57):
More.
Speaker 3 (17:58):
Has it that in nineteen eighty one the head of
OHIRA who was trying to oversee the regulation, Christopher de Muse.
So these are terrible. We just get rid of these
that we're going to lower agricultural fruit prices, and he
made a pitch to the cabinet and he was torn apart,
apparently by the Secretary of Agriculture who said, this is nonsensus.
(18:20):
These orders are part of our agricultural system there, how
dare anyone question them? And apparently he was sort of
shamed into silence, and that was that for the agricultural
marketing order. So it is a reality if you want
an example of and I'm sure the Secretary of Agriculture
(18:41):
was just giving reading the talking points written by by
senior career people there who probably who were behind the
entire agricultural marketing system. So it is a problem now
areas agricultures in the area. Is also something called Kapper
Bolstead Act that snani first exemption for agricultural commodities. But
(19:05):
a lot of things create barriers to entry. That's certainly
the maritime and cartel like agreements. For example, maritime trade,
there's something called you can't if your foreign tag vessel
foreign producer. You can't have urb vessels participate in coastal
(19:26):
trade in the US and one coastal port to another.
That's prohibited by something called the Jones Act. Problem is
a Jones Act, which was supposed to promote the shipping industry,
really hasn't. In fact its flag. It's become less efficient
US ships and it's prevented all sorts of anomalies that
(19:46):
containers would go from one fort full and if they
were empty, they couldn't you know, other ships that were
not tagg couldn't pick stuff up. There's a whole study,
host of studies about how the Droones Act has has
raised prices. UH agricultural really are totally supportive. But in
(20:07):
agriculture sugar quotas, the quota for US sugar production UH limited, limited,
limits the number of imports, limits the percentage of total
sugar sold in the US that's imported, and that's benefited
a small number of very powerful producers. Is one famous family.
(20:30):
I won't mention it, don't want to get into names,
but in in Florida originally from Cuba, which in fast
presidential administrations fought hard to retain those sugar quotas. And
again I think the Agriculture Department in certain trade interests
were supporting that. So this is very so, this is
very difficult because you are going up against and trench interests.
(20:56):
You have issues in agri In energy, I regular they've
been attempts, say to deregulate electricity generation, but there are
these big transmission regional transmission networks and overseen by the
Federal Energy Regulatory Commission, and it was often you get
(21:20):
these very complex rules of a rule called Rule one
thousand enacted in twenty twelve that basically required all sorts
of cost sharing in different parts of the country to
support improvements in the transmission system. The idea was supposedly
to enhance competition, and are a number of studies that suggests
(21:40):
that there have been billions of dollars, if not hundreds
of billions of dollars in lost welfare because this has
created confusion. It's been a highly bureaucratic They have been
efforts to reform that. It was a new Order last year,
but this has sort of endemic in all the old
regulated industry. So I think the Carter and Ford administrations
(22:04):
part of did a good job in trying to go
after some traditionally highly regulated industries, you know, interstate trucking, aviation.
But it's still the case that sectors of you know, transportation,
as I said, shipping, agriculture, energy, transmission still are highly regulated,
(22:28):
and again usually it was a sort of safety and
soundness or or natural monopoly in the case of energy,
or ensure the orderly survival of the industry in agricultures
doing the great depressions, supposedly protecting small farmers. So lots
(22:48):
of these justifications that were originally supported these regulations make
no sense in today's world. But those are But anybody
trying to repeal these things that are going to have
a fight on these are our hands.
Speaker 4 (23:02):
So so I want to I want to, I want
to come back to some of the points you just made.
I want to give Kathleen and Charlie a chance for
me to react to it. But but let me also
throw out another question that I think I think I
had not anticipated raising. But all the talk about agriculture
UH and transportation reminds me that the state action doctrine
(23:27):
right is an outgrowth of an attempt to regulate I guess,
a successful attempt to regulate at the state level or
protect competition at the state level in the among raisin
growers and sort of the North Pennington comes out of
sort of efforts with respect to transportation. So as as
(23:52):
the agencies think about UH, deregulation efforts. Should they also
be thinking about a stronger push on state action and
more protections for you know, basically either seeking regulatory protection
or granted having granted regulatory protection.
Speaker 3 (24:17):
One interesting thing is that in Europe state owned enterprises
or subject to the anti cross laws, even state owned
monopolies and UH, that is not really the case in
the United States Tennessee Valley Authority and Energy. And the
(24:38):
problem is you get a monopoly that tries to exclude
entry in areas where competition might be possible. Postal Service
is famous for that it's subsidized first class mail by
trying to make it more difficult also for competition to
arise in UH outside it's it's it's natural enough sort
(25:00):
of in packaging and it has been finally enterayved by
UPS and Federal and FedEx. But in Germany, for example,
the German postal monopoly tried to engage in pricing tactics
to exclude FedEx and UPS and they were fined by
the European Commission. Now that can't happen in the US, indeed,
(25:22):
because there's a special federal statue that exempts the US
Postal Service, which is a corporation coming out of the
reference to the postal monopoly. The Constitution where a specific
statute exempting the postal service to ani cross law. So
we're talking about regulations, but it could be that if
(25:43):
the Postal Service Corporation were subject to anti trust law,
you might have more competition in that particular area. So
I think there's a lot of justifiable criticism of our Europeans,
but perhaps this is one area where we could take
a page from Europe.
Speaker 4 (26:01):
I'd also say that the state aid issue, for you know,
Europe seems to get the state a state aid issue. Correct.
But Kathleen, any any reaction of what what what we've
heard so far from Alman and Charlie on sort of
the scope.
Speaker 6 (26:16):
Yeah, So I will agree with Alden that the ft
C and d o J have a really important role
in any effort like this and pushing back on and
I trust immunities and exemptions. And I think now well
known that a GUH. Gail Slater and who's in charge
of the Ant Trust Division, has talked about and I
(26:40):
trust being a scalpel. And I agree when you're swimming down,
if you're working to slim down the need for regulation
for market failures, vigors, anti trust enforcement is going to
help you do that. It is a scalpel that will
that will encourage that effort. So I think there was
(27:03):
also an element of, you know, on scope, how do
you determine what to prioritize? And I think just picking
up on what folks have been talking about so far,
you can ask the question where consumers not getting the
services they need? Where are they paying well above margin prices,
(27:27):
and where are their bottlenecks, for example, in the supply chain,
And I think that can point you to where priorities,
where you can put priorities, And a lot of those
are things we've already talked about. You know, we're all
customers are not getting services they need in a lot
of areas like healthcare and agriculture and health care as
(27:49):
so police is where pricing is a problem, and shipping
is an area where there's a bottleneck and the supply chain.
I just also say that sometimes the barrier to entry
is not always just a street forward prohibition, although clearly
(28:10):
those exist. You have certificate of needs for hospitals for example,
or license sure issues that limit who can provide certain services,
but it can also manifest and the ways incumbents can
be advantaged at the cost of newcomers. So I mentioned
briefly before reimbursements for Medicare or Medicaid. Are they neutral
(28:32):
or are they favoring incumbents. Another example, and I think
that's only come to the four recently, is data. Can
data protections that are part of regulations become a way
of I put protections in quotes there become a way
of entrenching incumbents. I think this is a question, for example,
(28:55):
with seed companies, genetically modified seed companies, and digital farming.
So I think those are all things that need to
be taken into consideration when they came up the scope of.
Speaker 4 (29:05):
This, Charlie, any any reaction to, you know, sort of
follow up whats So I think.
Speaker 1 (29:14):
I'll start with that the Executive Order at least is
focused on federal regulations, so that is an important, sort
of independent component of the problem. And I think there's
a lot of work. I mean, there's there's a lot
of problems, and there's there's I think nobody would dispute
that there's enough work to be done in federal regulations alone.
(29:34):
On the state question, I would just raise that it
you know, it. I think there's a lot of broader
legal issues. More generally, it's not to say state level
regulations are an issue. I think if you look at
North Carolina dental, any of the recent state action enforcement,
obviously there can be state regulations that are an issue.
All then raised sort of the state aid framework. In Europe.
(29:57):
This is just a personal observation, but I think they're
the European history suggests that their competition laws had sort
of perceived a necessity towards federal and anti trust enforcement
at the state level to prevent things like tax competition
that here in the United States, I think there are
(30:17):
not many people critical of tax competition as potentially being
a beneficial concept. So I would just say I don't
think Europe is a perfect model for competition enforcement of
local regulator regulations because there's a different historical context, and
since it's since this is a federal society discussion, I
(30:39):
would of course have to note, right, we have I
think very robust principles of federalism in the United States
that these sort of federal enforcement of anti trust laws
have to consider, which just all of which is to
say just I think makes the state level issue all
the more difficult, even if there are significant problems and
(31:03):
even more protectionist interests many times at the state level
that that demand a solution.
Speaker 4 (31:10):
Excellent, All right, Well, look, we could talk for hours,
maybe even days, on all the regulations that limit competition,
and you know, DJ and the FTC have limited resources,
and you know, I mean it looks to me like
the FDC is sort of quarterbacking a lot of this effort.
(31:30):
So Alden, I want to get to your comment. Your
comment with Shanker suggests a framework for identifying the you know, prioritize,
prioritizing regulatory overreach, right to go after to seek to
repeal or sind or modify. So I think it'd be
(31:52):
helpful for the group, for the listeners for you to
describe your your comment.
Speaker 3 (31:59):
Right, well, thank you, thank you. Well. Yes, Shanker Singham,
who is a lawyer, economist, I've done work with, we
done he's done consulting work in Europe UK. Here we
jointly submitted a comment basically suggesting that we anticipated agencies
(32:21):
may say, okay, we're prone by the order to list
our anti committed regulations, how do we identify them? And
it's there's a hint more than one hint given in
the executive order, which is helpful. But there's our Organization
of Economic Cooperation Development, which is sort of the Rich
Countries think tank, which located in Paris, a thirty bus members.
(32:47):
US as a member submit submits economic recommendations and reports.
And it did one on competition in effect competition advocacy
called Competition Assessment Toolkit. And by the way, in twenty nineteen,
the US delegation to the OECD under President Trump, voted
(33:11):
in favor of accepting his toolkit for use by OECD members.
And the four points they say, look, you should look
at in finding any competitive regulations. One regulations that limit
the number or range of suppliers. Two limit the ability
of suppliers to compete. Three reduce the incentives of suppliers
(33:34):
to compete. And four limited choices and information available to consumers.
And it's got then a lot more granular detail and
it's and it's got second and third volume nitive's technical guidance.
So people say, okay, those are good principles, but how
do I know how do apply them to major regulations
(33:55):
in my agency? You look at the volume and it's
very very detailed, very good and it can be used
for issue spotting, not necessarily say how bad things are,
but to quickly. So I think that would be very
helpful in fact for use by agencies, particularly since the
(34:15):
United States has endorsed it officially, and in fact OCD
members including Canada, South Korea, Mexico, Greece, Isan, Romania, various
Asian countries Brazil for better Wars have tried to have
applied the toolkit. So I think that's something to think about.
(34:38):
If you get the complaint, well, give us more detailed guidance.
You don't have to get any economists that the old
RFTC to right up the guidance. It's already been written off.
And by the way, the economist in charge of that
is of American PhD economists who served six years in
the Anti Press Division from I think nineteen ninety nine
to two thousand and five, and so that is very helpful.
(35:04):
And I also talk more generally, but this is probably
less direct applicability about an econometric model that Singham and
others have developed to try and see how particular regulatory
structure is. This taught property rights protection, domestic competition, and
international competition, and I think those would be useful more broadly,
(35:27):
really in sort of a planning exercise by the government.
But there is one guy I would highlight. There is
a doctor Casey Mulligan, who is expected to be confirmed
as Chief Counsel for Advocacy in the Small Business Administration.
He's a professor at University of Chicago economist was specialized
(35:50):
in assessing the costs of regulatory systems. He testified several
times before Congress in two thousand and one to twenty
three about the costs of the last administration's regulatory programs,
and he has says the real problem is that people
are going to say, well, let's look at the costs
(36:12):
of delays filling out paperwork. He said, no, the main
costs really are distortions in the market, and there are
ways of estimating that. It's wrong to think that you can't.
He gave the example in an interview I had with him.
I think a couple of federal regulations whose real negative
impact was perhaps a thousand times larger than the paperwork
(36:34):
costs which had been estimated by OMB at one point
in the Biden administration. So I think there are tools.
It's a tough thing to do. But since it's some
sense all of government. I would I'm putting in a
shameless blug here. I hooked doctor Mulligan, who's worked tirelessly
(36:56):
on this area. His brain might be tapped by folks
at the OJ and FC.
Speaker 4 (37:01):
Well, of course, I think I think Casey was was
in the White House, uh during the first Trump administry,
was so hopefully, hopefully his use get picked up by
by the agencies. Uh, Kathleen, you touched on this, maybe
i'll less you expand on it. What other opportunities do
(37:23):
you see for both the agencies and private parties or
associations or everyoneant to call it too to play in
this area? Right? I mean, I'll just make a personal note.
When I was head of the Office Policy Planning at
the FEC, you know that office does a lot of advocacy. Uh,
(37:46):
lots of times we are alerted to things by you know,
by third parties, by affected parties, by firms who may
may be in a sense harmed or excluded from markets
by by regulation, by legislation or new rules or interpretations
or rules. So what how else do people playing and
(38:06):
what other opportunities are there? Yeah?
Speaker 6 (38:09):
So I think it is really important that the FTC
and DJ continues their advocacy at the state level to
avoid anti competitive state legislation and state regulation, and I
think it's really important that they continue to push back
on exemptions and immunities in the courts. There's a long
(38:36):
history of DJ and FTC doing that. We've we mentioned
North Carolina Dental earlier, So I think that's another significant
component of what the DOJ and FTC can do here.
But I also think we can't underestimate the power of
private anti trust enforcement. Now. Not everybody has the resources.
(38:58):
Sometimes you're talking about a small group or group that
doesn't necessarily have the resources to bring a big anti
trust case. But class action and private other kinds of
private anti trust enforcement have the potential to really be
a good supplement here where way past the days if
(39:20):
those days ever existed when the private actions were follow
on suits to d o J cartel investigations. And we're
I think in a new stage of private anti trust
enforcement now, and I think a lot of advocates of
smaller government and deregulation, et cetera, are starting to see
(39:43):
a lot of folks are writing about private actions as
a tool that allows maybe more of this public choice aspect,
and private plaintiffs can point to places where there are
competition issues, the companies being advantaged by bottleneck by bottlenecks upstream,
the consumers hurt by high prices. The market in some
(40:07):
ways selects the plaintiffs. I would just point to in
our case, we did a recent Amikus in a thirty
three forty B case where and this is this is
a program that allows for low cost drugs to certain communities,
(40:27):
and the case pointed to a competition problem. There a
potential conspiracy among the pharmaceutical companies to restrict thirty three
forty B drunk availability. But on the flip side of that,
there's also a question of who can participate, and maybe
the regulations are too restrictive on who can participate in
(40:50):
this three forty B program. So that's just an example
of where, you know, things that come up in private
litigation can point you to where the competition problems are
and they have a really important role in enforcing and
doing a market based job.
Speaker 4 (41:08):
You know. Before before we move on, I want to
note too, although this was not an anti trust violation,
I want to note that during the Biden administration, the
FTC did a study short study of the infant formula industry.
And I think that study, while I you know, identified
(41:30):
government regulations that seemed to limit the number of firms
I could participate in the government you know which program
for formula. And you know once when one of those
plants went down, that had a significant effect by a product. So,
you know, I think that's interesting. I found that the
(41:51):
i'll call it the so called progressive movement on it,
and I trust it was at least a portion of
that movement that seemed called with allowing UH employees outside
the context of unions or professionals outside the context of
unions to get together through trade association codes or professional
(42:15):
licensing bodies UH to limit competition. But at least some
at least some of the folks on the left in
the previous administration, you know, we're we're open to removing
or at least to identifying regulatory UH barriers to competition,
(42:38):
including you know, government rules, government rules. But well, then,
before before we turn to questions from the audience or
even the end of the program, I'd ask you to
kick off a discussion of you know, how, how does
how do the agencies? How does the government do some
(43:00):
of this deregulatory effort quickly, right, I mean, I think
of deregulation as sort of requiring, you know, notice and
comment processes under the A P A. But at least
there's a strand of the thought that says lower bright
the decision of Lowerbright removing or overturning Chevron can allow
(43:27):
for speeded up deregulatory efforts. So all, maybe I'll let
you kick a discussion off there and then ask Darling
Kathleen for comments.
Speaker 1 (43:35):
And I can I before we get into that process, point,
can I just respond to two points from all that
and Kathleen in the last topic?
Speaker 4 (43:44):
Sure? Sure.
Speaker 1 (43:45):
So I wanted to address because it's timely, the comment
on the internet of the OECD report without taking any
view on that report, because the OECDB needs are happening
next week. And I think this deregulatory advocacy is an
important important part of the Anti Trust mission, right, anti
trust and trade policy are not so separate and many
(44:06):
other places in the world, and I think nor regulation,
and so I think educating the broader community on the
impacts of anti competitive regulations is an important part of
the division's mandate. And I know it's something that my
colleagues are focused on in those meetings. So I just
wanted to sort of second the importance of those initiatives
(44:27):
that all of them raised, and then on the exemptions
and immunities which Kathleen talked on. Agreed that the sort
of limited construction is important, and we, since I joined
the Division, have filed the statement of interest in the
Black Rock ESG. Case, which it's not a pure regulatory
exemption but it's a passive amester exemption in the section
(44:48):
seven the Clayton Act. And so I think that is
a case where sort of continued advocacy of limited exemptions
is an important part of the advocacy efforts. That's also
an interesting factual context, right, because it's an example where
I think the attack on coal sort of had two prongs. Right,
there were federal regulatory initiatives like the Clean Power Plan
(45:09):
that were struck down in the Supreme Court, and then
there were private market conduct that was alleged in the
complaint from Texas, where at least as alleged, right, there's
activity at the private level that is reducing output amongst
coal companies. So I think that's a good way to
sort of view antitrust in deregulation or at least regulatory
(45:31):
review as sort of complementary tools. I just wanted to
add that.
Speaker 4 (45:35):
All right, super so, so all then can you just
touch on you know, the basically what I think is
the effect of lower bright.
Speaker 3 (45:44):
Or okay, Well, there is an exception to require notice
in comment or withdrawing your rule. According to the APA says,
the agency can forego notice in comment when it finds
good cause that notice and ment are impracticable, unnecessary, or
(46:05):
contrary to the public interest. Now, contrary to the public
interest may be helpful. It applies when the prior notice
would undermine the rules of effectiveness or the underlying satutory scheme.
And some of the audience may know. Local Bright basically
said that the courts are the ultimate federal courts interpreter
(46:27):
of the meaning of rules, and that there will not
be difference to an end to reading of U. When
there's a so called set for ambiguity AH, an interpretation
by the agency will not be deferred to. The courts
will say, is this regulation and the fact or rule
(46:49):
you know, the best reading in effect of the statute.
So in many cases may be possible to say that
look in some areas, let's say not the cerily DOESTPA.
But there have been some very broad interpretations of the statute,
like the meaning of waters of the United States in
environmental regulation or land use regulation. And in many cases
(47:12):
it may be possible to say consistent with the public interest.
We find that these readings of the statute are due violence.
They're not consistent with the stat with the statutory scheme
at all. And therefore we feel that you know our
duty to take care that the laws be faithfully executed.
President's duty that we eliminate this rule because it really
(47:36):
does not It wasn't justified in the first place as
a matter of statutory construction. Now the problem is you
you're not always going to be able to do that.
Some constructions you just may may be consistent with the
statute because the statute wanted to limit entry and the
regulation sort of close. So the question is, is contrary
(48:02):
to the public interest?
Speaker 4 (48:04):
Uh?
Speaker 3 (48:04):
Can you make a different readings, say this inconsistent the
rules of effectiveness? There there's is it impracticable to really
if you believe a competition is a general policy, so
they may be so low for bright decision may be
helpful in allowing uh, some rules to be quickly pulled
(48:27):
without bills that comment, but not always. And then you
can challenge that there will be challenges in federal district
court on saying that well, pulling the rules are turring
capricious and in the United States, with the correct lawyers
from Justice depart and so on, I think we'll be
on the spot to explain why a particular withdrawal was
(48:48):
not arbitrary and capricious. I mean, will the sacred reasons
a good call? There needs to be a statement of
the reason sessifying by passed and notice of comment and
some but so but as we've seen in recent months,
sometimes district courts are showing prelection for trying to stop
(49:11):
activity by uh uh the administration that it believes that
stat's totally justified to want to take. So we'll just
have to.
Speaker 4 (49:19):
See, un think, Charlie, any reaction to you know, sort
of the you know, the process by which is the
regulatory effort might right, might take books. And then I
have a very good question from the from the listeners.
Speaker 1 (49:35):
I will leave that to the much more adept experts
in the federal programs than other divisions of the Justice Department.
I'm happy to circle back to something you said earlier
on the formula, not comment on that case, but on
a larger principle. But I'll let Kathleen comment.
Speaker 6 (49:52):
Well. I also don't want to wade into administrative law
areas that I don't have expertise in, but just as
a little bit of an aside there, since we brought
up Looper Bright, I think they're you know, looking through
the comments, I will note that there's a lot of
(50:13):
discussion in the comments about the non compete role and
the importance of of of not of being very careful
about non competes in many cases, not restricting them altogether.
So I guess there are two sides to that issue.
(50:36):
Since I think folks may be concerned that the non
compete role and Loper Bright might collide at some point, I'm.
Speaker 4 (50:44):
Going to comment on that, but I'm gonna I'm going
to ask Charlie to comment as as you asked, I don't.
Speaker 1 (50:51):
I don't want to comment on that specifically, but I
can comment all on the without sort of taking any
position on the merits of the investigations that the fact
sort of the factual circumstance to describe there. I think
is one that you know, could occur in many other industries,
right where there's a regulatory regime in place. And I
(51:12):
think the hard thing from an anti trust enforcer's perspective
is to understand, you know, is the when the exercise
of market power is coming from a government grant of
monopoly or some regula, some market power derivative of that
government regulation. Where is there an anti trust violation and
where is there just an abuse of an anti competitive rule.
(51:34):
And I think that's where anti trust and deregulatory reform
can be very good compliments, right because rather than attempting
to use anti trust to sort of get at quasi
exclusionary conduct, you can use deregulation to just as to
use the metaphor that Kathleen alluded to that the age
slater is used, right Scalpel, and just cut out the
(51:56):
anti competitive regulation. And then I think, ideally, right you
would not have to sort of stretch anti trust to
broader conduct. But I think it's a hard question, but
it's one where the deregulatory initiatives can work in tandem
with anti trust to combat anti competitive conduct.
Speaker 4 (52:15):
Okay, So I want to get to one of the
questions and then I have a question too. But I'll
also throw something out, Charlie in response or maybe as
a related to what you mentioned. When when the FDC
and DJ drafted the twenty twenty Vertical Merger Guidelines, there
was a comment I believe by one of the FTC
(52:38):
Commissioners that the twenty twenty Vertical Merger Guidelines failed to
include a discussion of regulatory evasion as a form of
harm that may come up in vertical mergers. I think
it was also excluded or not really referenced or incorporated
into the twenty twenty three merger guidelines. And i'll i'll
(53:00):
note that the one reason it was not included in
the twenty twenty vertical Merger Guidelines, that is, regulatory evasion
is a theory of harm, because there was a view
by by some of the drafters and participants that that
theory of harm is not really an anti trust theory
of harm, but a theory of you know, well, a
(53:25):
concern that you know, this was an issue for regulatory
agencies to address, you know, if if they're if their
rules could be gained you know. Yeah. So, but I
just throw that out there because I think it is
important to think about again as the agency goes forward. Right,
(53:45):
we have a whole theory of harm and associated with
vertical mergers that appears to focus not on conduct arising
from the merger, but on the regulatory framework that allows
the evasion to occur. So, so, Mike, Mike Murray asks
(54:06):
a very good question something we hadn't talked about in
our in our prep What about the development of standards?
Standard setting? Standards can be both pro competitive and an
anti competitive barrier, right, are the but this way should
(54:27):
the agencies be thinking about the standard setting process? There
were you know, in the UH, in the in the
Reagan administration and of course prior but in the reagul administration,
there was some interesting standard setting cases. Uh, there was
standard setting issues in the U in some of the
(54:49):
case like in the Rambis case that the FDC board.
Now over twenty years ago, we haven't seen a lot
of standard setting stuff coming out of the agencies in
the past two decades. Should should we see more?
Speaker 3 (55:02):
Well, let me just note Assistant Attorney General delaheen Uh
in the first Trump administration was concerned. One of concern
he said, was that the standards process, where you had patents,
standard es, central patents being developed, that there might be
uh you know, anti competitive rules to restrict returns, to
(55:25):
limit returns to the holders of patents included in standard
might be a source of ANNI trust concern. On the
opposite side of the spectrum, I think in the UH
at the end of you Obama administration, there had been
stated concerns about that standards should be developed h in
(55:46):
ways that prevented an effect AH anti competitive hold up
by patent holders. Who's who's after the fact. His patents
after the fact was said to read on the standard.
So certainly there's been given some thought was given to
standard setting from two different perspectives in in in recent administrations,
(56:10):
but more broadly, as if for law set, certainly there's
a The Supreme Court has told us that that exclusion,
any competitive exclusion to procedural hygienks uh can can could
violate the anti trust laws that was decades ago. So
uh yeah, I think it's standard setting is always worth
(56:32):
looking at.
Speaker 6 (56:34):
I would agree with that, And I think standard setting
and the problems of self regulate regulating bodies that kind
of act as regulators at the state level are similar.
Where you have the potential for AH entities that can
stand to benefit from restricting the market or including their patents,
(56:56):
et cetera. There's always a role for UH outside correction
to make sure that those conflicts don't that those interests
don't result in anti competitive facts.
Speaker 4 (57:10):
So we have we have just a couple of minutes left.
I'm gonna throw a question out that and maybe even
a plug that I some of you know I have.
I have a podcast Forethinking and I Trust, and the
next the next episode is going to be a discussion
with Katie Ambrosi, formerly of the FDC's Office Policy Planning
(57:32):
and other parts of the FTC. We talk a lot
about healthcare restrictions regulations in the healthcare space that have
the effect of limiting competition. Of course, they may they
may have positive reasons, you know, safety and health, but
I think the ones we talk about are mostly focused
on protecting incumbents from competition. And one of the things
(57:54):
we talk about, which I want to raise with with
the three of you, is should merger review process be
used to remove restrictions on entry?
Speaker 6 (58:08):
Right?
Speaker 4 (58:08):
I mean, there's a lot of talk about moving to
moving to back to divestures as sort of the you know,
preferred to the litigation to address deals. One thing that
I think FUK did in the nineties after the nineteen
(58:28):
ninety two Energy Act was used the merger approval process
to deregulate or require divestiture across across sort of the
three lines of activity to bring competition into the electricity space.
(58:50):
Can should Should the agencies look to remove restraint restrictions
on entry as part as part of the vestiters And
I'll give the example. I'll give the example that I
think relates to something Kathleen that you said, which is,
you know, hospitals, employees of hospitals, including physicians and also
(59:15):
employees of physician group practices probably operate on their non
compete agreements, you know, physicians especially, Should the agencies be
thinking about as a condition to approval of hospital deals
and you know, physician group practices deals and maybe some others,
removing restrictions on the employees noncompete restrictions on the employees.
(59:38):
This would get around perhaps the limitations of a noncompete
rule to you know, in areas where you see potentially
real shortages of entry or real shortages as a supply. So,
should they use the merger review process to remove impediments
(01:00:02):
to entry by market participants or potential marketing.
Speaker 6 (01:00:08):
Well, I do have a concern that that could be
I could see a use for it, but I also
think that it could be a reason to approve something
that shouldn't be approved. So I don't think we should
be compromising the merger review process or letting things through
because we've there's a condition on it that would ostensibly so.
Speaker 4 (01:00:32):
It can be a compliment, not an all tournaments. Yeah,
your points a good one. Your points a good one,
but also be thought it as a compliment.
Speaker 6 (01:00:41):
Yeah, I agree with that, and I think we just
have to be sure that it's staying in the realm
of merger economic analysis, because I think there can be
a temptation to go outside that.
Speaker 3 (01:00:55):
Yeah, there has been a critique, and I see that
you're pointful at that the husband a critique about trying
to shoehorn non merger related problems into a merger into
a merger settlement, that that there is that legitimate role
for the agency to be playing. If the agency is
a concern about some other aspect that's extraneous to the merger,
(01:01:19):
you shouldn't. So there's that contrary argument, and I haven't
thought at debts about that, but it seems to me
there's some conflicting thoughts.
Speaker 1 (01:01:30):
Well, I answered a little bit around it that way,
which may not be fully satisfying, but I think is responsive.
If you look at Deputy's this Attorney General Bill will
Bill Renner's comments and speech on merger remedies that he
gave a GW a week or two ago, I think
it focuses a lot on the Tanyact context in which
murder merger settlements take place. And one of the points
(01:01:53):
he made in that speech is that that discipline's enforcement.
So to follow on Kathleen's last point, right, you know,
to the extent that and enforcement action is predicated on
Section seven and not broader issues, right, I think that
Taniac structure gives some discipline to the process on you know,
a hard question.
Speaker 4 (01:02:14):
Okay, So I think I think I think we are
just after one. So unless there are any other comments
anyone would like to make or questions from the from
the attendees, I think I think we're about to close out.
Is that is that right? Leby?
Speaker 6 (01:02:31):
Yes?
Speaker 5 (01:02:32):
I think that just about wraps it up. But thank
you so much for moderating, Belall, and thank you again
to everyone on our panel for joining us and for
sharing your insights today. Thank you also to our audience
for tuning in and for your excellent questions. And for
more content like this from the Regulatory Transparency Project here
at the Federal Society discussing the regulatory state and the
(01:02:52):
American way of life, please visit us at regproject dot org.
That is our e G reg project dot org.
Speaker 1 (01:03:00):
Thank you so much, Thank you, Thanks.
Speaker 2 (01:03:02):
Everybody on behalf of the Federal Society's Regulatory Transparency Project.
Thanks for tuning in to the Fourth Branch podcast to
catch every new episode when it's released. You can subscribe
on Apple Podcasts, Google Play, and Speaker For lays from
our TP, please visit our website at regproject dot org.
That's our egproject dot org.
Speaker 6 (01:03:32):
This has been a FEDSC audio production.
Regulation after regulation. There are dated regulations that need to
be changed.
Speaker 2 (00:05):
One hundred and eighty five thousand pages.
Speaker 3 (00:08):
Now public accountability and transparency. There will be no public supports.
Speaker 4 (00:13):
It's really the best we can do. There's a regulation
that doesn't make any sense.
Speaker 2 (00:16):
Why do you keep you know who wrote the regulatory
laws you must comply with. Welcome to the Regulatory Transparency
Project's fourth Branch podcast series. All expressions of opinion are
those of the speaker.
Speaker 5 (00:33):
Good afternoon, everyone, and welcome to today's Regulatory Transparency Project
webinar titled Reducing Regulatory Barriers the Future of Market Competition.
We're so glad that you're able to join us today.
My name is Lippy Dickinson, and I am the assistant
director with the Federalist Society's Regulatory Transparency Project. As a reminder,
all opinions expressed are those of the speakers and not
(00:53):
of the Federalists Society. We're honored to be joined today
by an excellent panel of legal and antitrust experts addressing
proposals of President Trump's recent executive order concerning the production
of anti competitive regulations and what it will mean for
market competition. After the panel discussion, there will be a
short period designated for audience questions. We ask that you
(01:14):
submit them via Zoom's Q and a feature not the chat,
and that they are pertinent to the topic at hand.
In order to get right to the discussion, I'll start
by briefly introducing each panelist and then hand things over
to our moderator to start the conversation. Our panel today
includes Aldon Abbott, Senior Research Fellow at the Mercadis Center
with George Mason University, Charlie Beller, Counsel to the Assistant
(01:35):
Attorney General Anti Trust Division with the Department of Justice,
and Kathleen Bradish, the Vice President and Director of Legal
Advocacy at the American Anti Trust Institute. Our moderator today
is bellaal Sayid, a Senior Adjunct Fellow at Tech Freedom.
You can find out more about today's moderator and panelists
at Federalists at the Federalist Society website fedsock dot org.
(01:58):
That is fedsock. With that, and we'll hand things off
the below to get us started. Thank you so much
for joining us today.
Speaker 4 (02:05):
Below. Thank thank you Liby, and thank you for pople
both for joining and of course thank you to our panelists,
so you know. Pursuing to Executive Order one four two
sixty seven, the Administration has tasked east agency within the
executive branch of the federal government, and any independent regulatory
(02:25):
agency to identify and recommend the modification or recision of
any regulation for which they have rulemaking authorities that creates
or facilitates the creation of the facto or the jury monopolies,
creates unnecessary barriers to enter it for the market participants,
limits competition between competing entities, or has the effect of
(02:47):
limiting competition between competing entities, create so facilitates licensure or
accredation requirements that unduly limit competition, that unnecessarily burdens the
agencies curement processes, or otherwise imposes anti competitive restraints or
distortions on the operation of the free market. Prior to
(03:08):
the administration's executive order, the Department of Justice had announced
an Anti Competitive Regulations Task Force that will advocate for
the elimination of anti competitive state and federal laws and
regulations that undermine free market competition and harm consumers, workers,
and businesses. And shortly after the executive order, the FDC
(03:31):
sought comment from the public on federal regulations that exclude
new market entrants, protect dominant incumbents, and predetermined economic winners
and losers. So what we have is a well, what
we have is the FTC with the Department of Justice
sort of taking leadership of what you might call a
whole of government approach to federal regulatory review, and of
(03:55):
course the FDC and DOJ perhaps advocating at the state
level for a moval of anti competitive regulations. So you know, Charlie,
you are the representative from the Apartment of Justice on
this panel, So can you describe the scope of the
initiative in response to the presidents and secutive order.
Speaker 1 (04:17):
Sure, and I'll start thanks first to the thought our
Society for doing the panel, and to my fellow panelists.
I'll start with a normal caveat that my comments are
my own, not visit the administration, the DJ or the AGE.
And I think, as you notable all there's sort of
there's the EO just for those that are less in
the weeds than all of the panelists here. There's the EO,
(04:40):
which is one of many, and then there's the Anti
Competitive Regulations Task Force, which is initiative specifically of the
Department of Justice, which I can speak to, and there's
a parallel initiative from the FTC, so that's sort of
the broader context. I think it's helpful, given sort of
the high level, to even take a further step back
(05:02):
to think a little bit about the history and context
in which they starre occurring, because I think it's important
from the divisions perspective, from my perspective at the division,
for how we're thinking about things. And I like the
adage from Oliver one of Holmes that a page of
history is worth a pound of logic, and I think
that's particularly relevant here. In the last Trump administration, there
(05:24):
was a similar regulatory review effort by Magan del Raheem,
who is the Age and Trump forty five that goes
into some details about the history. I think the most
relevant pieces being that really since the mid century and
the starting the Nixon administration, there was a concern about
(05:48):
the impact that the New Deal style regulations were having
on the US economy. That bled into the Carter administration
regulator regulatory reform efforts, most important there being the Airline
Deregulation Act, and then we saw in the Reagan sort
of an institutionalization of regulatory reform with AHIRA and then
(06:10):
further deregulatory efforts in the first Push and Clinton administrations.
I like the ADA and the Carter administration ADA as
a sort of paradigm for anti trust and deregulatory efforts.
And there's a story that, if you'll indulge me, I'd
like to tell it probably will be familiar to a
lot of folks in this group. Because of the National
(06:33):
Fed Sock Lawyers Convention. Last November, Justice Briar and Justice
Gorsitch had a sort of a sit down conversation, and
Justice Brier was talking about his time in working for
Ted Kennedy on airline deregulation. Justice Brier is an anti
trust expert. He actually sat in my seat here at
the Anti Trust Division as a council and so he
(06:56):
knew a thing about anti trust deregulation. And the up
out of that conversation was that anti trust is a
critical backstop to any deregulatory impetus. And so I think
that I think is really important is that there can
be regulatory efforts, but under public choice theory, right, if
you've remove the regulatory barriers and let the free market
(07:18):
solve the problems, anti trust becomes increasingly important as a
backstop to that private market sorting and competition that ideally
comes in and replaces the regulatory apparatus. So I'll stop there,
look forward to hearing thoughts from my fellow panelists. But
I thought sort of just having a brief history as
(07:41):
well as the broader political block stop would be helpful.
Speaker 4 (07:47):
All right, Thank you, Charlie. And I'll note as you noted,
of course, said Kennedy and Stephen Brier were instrumental in
President Carter's deregulatory effort. UH. And you know Jim Miller
and uh and also Tim Yurras who both at different
times became chairman of the FTC.
Speaker 6 (08:09):
UH.
Speaker 4 (08:10):
We're part of the White House, is the Reagan White
House is task force on regulatory reform right out of
the right out of the starter President President Reagan's presidents.
But anyway, let me let me, let me turn to
Kathleen and ask, you know, the FDC and d o
J have been aggressive players right over the last forty
(08:34):
fifty years. UH in a deregulatory effort. Charlie described a
little bit of bit, what what do you think are
there areas that the FTC and d O J should
be focusing on UH during this administration. You know that
that sort of aligns with the with with the push
for removing regulatory barriers to competition.
Speaker 6 (08:58):
Yes, and I will also thank the Federal Society and
my panelists for participating today. So I think, to answer
your question, the FTC and the DJ have an incredibly
important role in avoiding and eliminating anti competitive regulation. They
are the ones that have the skills and the experience
(09:21):
to assess the competitiveness of markets, and they I believe
can spot issues that other agencies may not be able to.
They have also had the experience collecting and working with
evidence to assess justifications like privacy, safety, et cetera that
are typically offered by parties when they seek market restrictions.
(09:44):
They do this as part as a part of their
day to day job, and it's they makes them very
well suited for this part of the project. And an
example of that is the FTC recently filed an amikas
brief in the Google Search case debunking privacy justifications that
(10:06):
have been raised by Google. So in that respect, their
role as an interagency advisor is really really vital. I
saw this firsthand when I was at DOJ and served
on the trade committees, the interagency trade committees. A lot
of that doesn't necessarily get seen by the public all
(10:27):
the time, but it may be one of the most
powerful roles that they have. And I hope that this
executive order serves as a means to really open the
doors of communication among the agencies. And I think it
can be really a good point of continuity between the
work done in the Biden administration with the whole of
government approach to competition and this administration. SO and Psychondolgic
(10:54):
put in a brief pitch for the FDC's powers to
conduct more market studies. This is something I think it
can be essential to this project. I think of the
Pharmacy Benefit Manager study for example, and it's part of
what makes FTC different than the DOJ and gives it
(11:15):
extra tools in its toolbox. SO and finally, on the
state regulation side, FTC and DJ have a really important
role in advocating advocating against anti competitive regulations on the
state level, advising state legislatures and sometimes going into court
when self regulating bodies. I think of teeth whitening and
(11:38):
teledanderistry come to mind. Put in place self serving and
restrictive conditions. In terms of areas where this can matter,
I think market concentration can help lead the way to
the problem areas. FTC and DJ can help identify errors
of our concentration is very high areas where it has
increased substantially in recent years, and really look for the
(12:00):
role that regulation might be playing there. I look through
some of the comments to the DOJ and FTC RFIs
on this and I see a lot of concern about
healthcare consolidation, for example, at various different levels, and that
raises questions about limitations, for example, about rules that may
(12:21):
be creating healthcare deserts in rural and low income communities,
or reimbursement schemes that may be in favoring favoring incumbents
over a new entrance. Just as another area, agriculture, I
see it. I see that a lot in the comments.
There is tremendous consolidation in meat packing and there and
(12:42):
for example in seeds is another area genetically modified seeds,
so there it's worth looking at restrictions on independent slaughter houses,
for example, and at the Plant Variety Protection Act to
see whether those are getting the balance of safety and
protecting innovation and competition. Right, So I think where you
(13:04):
have two or three or four players like makepacking and
cenetically modified seas, I think there's a presumption that something
is not working in regulation maybe playing a role in that.
Speaker 4 (13:16):
Yeah, that's that's interesting. I mean the agencies I think
did identify a few sectors where where they were going
to focus or might focus their efforts, and of course
healthcare and agriculture, energy, I think real estate markets.
Speaker 1 (13:34):
So I'm happy to jump in there quickly and then
we can let out and you know, vers be responses too.
But I just wanted to note on that that because
two of those industries are areas where the AGE specifically
identified I believe in the context of the Anti Competitive
Regulations task Force agriculture and healthcare. I talked a little
bit about airlines before, so transportation is already something that
(13:57):
has sort of a long legacy of deregulatory but I
think agriculture and healthcare less.
Speaker 4 (14:01):
So there are.
Speaker 1 (14:04):
Obviously pocketbook issues and that's an area of concern for
for the for enforcers generally, but I think it also
fits them with public choice literature. Right, these are industries
where you do not have the type of institutional interest
to push back on regulation, and so it fits very
nicely with the largest theoretical backdrop of why we're doing
(14:25):
this work. And that's I think kind Ofthen's point particularly
cute in healthcare where the average consumer of healthcare just
does not be able to push back, like maybe the
case in transportation or other industries where there's industry larger industries.
Speaker 4 (14:42):
So so Charlie, I'll just I'll just pick up on
that before I before I turned to Alden, and maybe
Olden can wain as well. I mean, is it is it?
Is it? Do you think of concern particularly the Justice Department,
but maybe also the SCC that agency is like you know,
Agriculture and HHS and either Department of Transportation or the
(15:07):
Surface Transportation Board. I mean you mentioned public choice. Is
there a concern these agencies have sort of been captured
and that you know, the FTC and do J has
to be maybe a little more public in their in
their pushback on the regulatory framework that that those folks
(15:27):
have both sort of adopted but maybe failed to uh
to manage in a way that does not that does
not protecting companies.
Speaker 1 (15:39):
I can't speak to the first point, But I think again,
I would just sort of think about it from the
perspective of the first principles of public choice theory. Right,
these are areas in which consumers and interest there are
not sort of organized interest groups, and so I'm not
sure I can speak to the first the specific question,
(16:00):
but I think the way I'm looking at it sort
of answers the same question, which is, there are going
to be industries in which consumers do not have the
ability to organize, and those could be areas where antitrust
deregulatory efforts are particularly important. I think some of the
ones that Kathleen pointed to me are frinding examples of that,
and those are the ones that the is this Attorney
(16:21):
General has also identified.
Speaker 4 (16:24):
So so Alden, let me let me get you in here.
Any any reactions so far, It's what we've heard so
far from either Kathleen or Charlie. I mean, you know,
you and and a colleague put in at a very
good comment to the FTC, and I want to turn
to that later, but I just wonder if you've got
(16:45):
reaction to, you know, the areas that that Kathleen mentioned
and Charlie mentioned, maybe you can also pick up on
the public choice stuff.
Speaker 3 (16:55):
Yeah, so I think this is all very helpful, and
thank you to Federal Society for inviting me. I'll just
been mentioned in passing. I held a job Charlie currently
holds in nineteen eighty four to eighty five at DOJ,
except in those days it was called specialist system to
the Assistant Attorney General instead of counsel. Counsel sounds a
lot fancier, I think, But anyway, yeah, public choice. I
(17:19):
think there's a specific example of that one. Some of
the restrictions are in agriculture, something called agricultural marketing orders
overseen by the Agriculture Department, which basically limit apply to
certain crops, especially certain fruits, and they limit the production
(17:41):
and it has allow informal quotas to be established and
set prices. Very anti competitive. It seems cartel like. And
these agreements are overseen, their industries involved in drafting them,
but overseeing by the Agriculture Department and.
Speaker 6 (17:57):
More.
Speaker 3 (17:58):
Has it that in nineteen eighty one the head of
OHIRA who was trying to oversee the regulation, Christopher de Muse.
So these are terrible. We just get rid of these
that we're going to lower agricultural fruit prices, and he
made a pitch to the cabinet and he was torn apart,
apparently by the Secretary of Agriculture who said, this is nonsensus.
(18:20):
These orders are part of our agricultural system there, how
dare anyone question them? And apparently he was sort of
shamed into silence, and that was that for the agricultural
marketing order. So it is a reality if you want
an example of and I'm sure the Secretary of Agriculture
(18:41):
was just giving reading the talking points written by by
senior career people there who probably who were behind the
entire agricultural marketing system. So it is a problem now
areas agricultures in the area. Is also something called Kapper
Bolstead Act that snani first exemption for agricultural commodities. But
(19:05):
a lot of things create barriers to entry. That's certainly
the maritime and cartel like agreements. For example, maritime trade,
there's something called you can't if your foreign tag vessel
foreign producer. You can't have urb vessels participate in coastal
(19:26):
trade in the US and one coastal port to another.
That's prohibited by something called the Jones Act. Problem is
a Jones Act, which was supposed to promote the shipping industry,
really hasn't. In fact its flag. It's become less efficient
US ships and it's prevented all sorts of anomalies that
(19:46):
containers would go from one fort full and if they
were empty, they couldn't you know, other ships that were
not tagg couldn't pick stuff up. There's a whole study,
host of studies about how the Droones Act has has
raised prices. UH agricultural really are totally supportive. But in
(20:07):
agriculture sugar quotas, the quota for US sugar production UH limited, limited,
limits the number of imports, limits the percentage of total
sugar sold in the US that's imported, and that's benefited
a small number of very powerful producers. Is one famous family.
(20:30):
I won't mention it, don't want to get into names,
but in in Florida originally from Cuba, which in fast
presidential administrations fought hard to retain those sugar quotas. And
again I think the Agriculture Department in certain trade interests
were supporting that. So this is very so, this is
very difficult because you are going up against and trench interests.
(20:56):
You have issues in agri In energy, I regular they've
been attempts, say to deregulate electricity generation, but there are
these big transmission regional transmission networks and overseen by the
Federal Energy Regulatory Commission, and it was often you get
(21:20):
these very complex rules of a rule called Rule one
thousand enacted in twenty twelve that basically required all sorts
of cost sharing in different parts of the country to
support improvements in the transmission system. The idea was supposedly
to enhance competition, and are a number of studies that suggests
(21:40):
that there have been billions of dollars, if not hundreds
of billions of dollars in lost welfare because this has
created confusion. It's been a highly bureaucratic They have been
efforts to reform that. It was a new Order last year,
but this has sort of endemic in all the old
regulated industry. So I think the Carter and Ford administrations
(22:04):
part of did a good job in trying to go
after some traditionally highly regulated industries, you know, interstate trucking, aviation.
But it's still the case that sectors of you know, transportation,
as I said, shipping, agriculture, energy, transmission still are highly regulated,
(22:28):
and again usually it was a sort of safety and
soundness or or natural monopoly in the case of energy,
or ensure the orderly survival of the industry in agricultures
doing the great depressions, supposedly protecting small farmers. So lots
(22:48):
of these justifications that were originally supported these regulations make
no sense in today's world. But those are But anybody
trying to repeal these things that are going to have
a fight on these are our hands.
Speaker 4 (23:02):
So so I want to I want to, I want
to come back to some of the points you just made.
I want to give Kathleen and Charlie a chance for
me to react to it. But but let me also
throw out another question that I think I think I
had not anticipated raising. But all the talk about agriculture
UH and transportation reminds me that the state action doctrine
(23:27):
right is an outgrowth of an attempt to regulate I guess,
a successful attempt to regulate at the state level or
protect competition at the state level in the among raisin
growers and sort of the North Pennington comes out of
sort of efforts with respect to transportation. So as as
(23:52):
the agencies think about UH, deregulation efforts. Should they also
be thinking about a stronger push on state action and
more protections for you know, basically either seeking regulatory protection
or granted having granted regulatory protection.
Speaker 3 (24:17):
One interesting thing is that in Europe state owned enterprises
or subject to the anti cross laws, even state owned
monopolies and UH, that is not really the case in
the United States Tennessee Valley Authority and Energy. And the
(24:38):
problem is you get a monopoly that tries to exclude
entry in areas where competition might be possible. Postal Service
is famous for that it's subsidized first class mail by
trying to make it more difficult also for competition to
arise in UH outside it's it's it's natural enough sort
(25:00):
of in packaging and it has been finally enterayved by
UPS and Federal and FedEx. But in Germany, for example,
the German postal monopoly tried to engage in pricing tactics
to exclude FedEx and UPS and they were fined by
the European Commission. Now that can't happen in the US, indeed,
(25:22):
because there's a special federal statue that exempts the US
Postal Service, which is a corporation coming out of the
reference to the postal monopoly. The Constitution where a specific
statute exempting the postal service to ani cross law. So
we're talking about regulations, but it could be that if
(25:43):
the Postal Service Corporation were subject to anti trust law,
you might have more competition in that particular area. So
I think there's a lot of justifiable criticism of our Europeans,
but perhaps this is one area where we could take
a page from Europe.
Speaker 4 (26:01):
I'd also say that the state aid issue, for you know,
Europe seems to get the state a state aid issue. Correct.
But Kathleen, any any reaction of what what what we've
heard so far from Alman and Charlie on sort of
the scope.
Speaker 6 (26:16):
Yeah, So I will agree with Alden that the ft
C and d o J have a really important role
in any effort like this and pushing back on and
I trust immunities and exemptions. And I think now well
known that a GUH. Gail Slater and who's in charge
of the Ant Trust Division, has talked about and I
(26:40):
trust being a scalpel. And I agree when you're swimming down,
if you're working to slim down the need for regulation
for market failures, vigors, anti trust enforcement is going to
help you do that. It is a scalpel that will
that will encourage that effort. So I think there was
(27:03):
also an element of, you know, on scope, how do
you determine what to prioritize? And I think just picking
up on what folks have been talking about so far,
you can ask the question where consumers not getting the
services they need? Where are they paying well above margin prices,
(27:27):
and where are their bottlenecks, for example, in the supply chain,
And I think that can point you to where priorities,
where you can put priorities, And a lot of those
are things we've already talked about. You know, we're all
customers are not getting services they need in a lot
of areas like healthcare and agriculture and health care as
(27:49):
so police is where pricing is a problem, and shipping
is an area where there's a bottleneck and the supply chain.
I just also say that sometimes the barrier to entry
is not always just a street forward prohibition, although clearly
(28:10):
those exist. You have certificate of needs for hospitals for example,
or license sure issues that limit who can provide certain services,
but it can also manifest and the ways incumbents can
be advantaged at the cost of newcomers. So I mentioned
briefly before reimbursements for Medicare or Medicaid. Are they neutral
(28:32):
or are they favoring incumbents. Another example, and I think
that's only come to the four recently, is data. Can
data protections that are part of regulations become a way
of I put protections in quotes there become a way
of entrenching incumbents. I think this is a question, for example,
(28:55):
with seed companies, genetically modified seed companies, and digital farming.
So I think those are all things that need to
be taken into consideration when they came up the scope of.
Speaker 4 (29:05):
This, Charlie, any any reaction to, you know, sort of
follow up whats So I think.
Speaker 1 (29:14):
I'll start with that the Executive Order at least is
focused on federal regulations, so that is an important, sort
of independent component of the problem. And I think there's
a lot of work. I mean, there's there's a lot
of problems, and there's there's I think nobody would dispute
that there's enough work to be done in federal regulations alone.
(29:34):
On the state question, I would just raise that it
you know, it. I think there's a lot of broader
legal issues. More generally, it's not to say state level
regulations are an issue. I think if you look at
North Carolina dental, any of the recent state action enforcement,
obviously there can be state regulations that are an issue.
All then raised sort of the state aid framework. In Europe.
(29:57):
This is just a personal observation, but I think they're
the European history suggests that their competition laws had sort
of perceived a necessity towards federal and anti trust enforcement
at the state level to prevent things like tax competition
that here in the United States, I think there are
(30:17):
not many people critical of tax competition as potentially being
a beneficial concept. So I would just say I don't
think Europe is a perfect model for competition enforcement of
local regulator regulations because there's a different historical context, and
since it's since this is a federal society discussion, I
(30:39):
would of course have to note, right, we have I
think very robust principles of federalism in the United States
that these sort of federal enforcement of anti trust laws
have to consider, which just all of which is to
say just I think makes the state level issue all
the more difficult, even if there are significant problems and
(31:03):
even more protectionist interests many times at the state level
that that demand a solution.
Speaker 4 (31:10):
Excellent, All right, Well, look, we could talk for hours,
maybe even days, on all the regulations that limit competition,
and you know, DJ and the FTC have limited resources,
and you know, I mean it looks to me like
the FDC is sort of quarterbacking a lot of this effort.
(31:30):
So Alden, I want to get to your comment. Your
comment with Shanker suggests a framework for identifying the you know, prioritize,
prioritizing regulatory overreach, right to go after to seek to
repeal or sind or modify. So I think it'd be
(31:52):
helpful for the group, for the listeners for you to
describe your your comment.
Speaker 3 (31:59):
Right, well, thank you, thank you. Well. Yes, Shanker Singham,
who is a lawyer, economist, I've done work with, we
done he's done consulting work in Europe UK. Here we
jointly submitted a comment basically suggesting that we anticipated agencies
(32:21):
may say, okay, we're prone by the order to list
our anti committed regulations, how do we identify them? And
it's there's a hint more than one hint given in
the executive order, which is helpful. But there's our Organization
of Economic Cooperation Development, which is sort of the Rich
Countries think tank, which located in Paris, a thirty bus members.
(32:47):
US as a member submit submits economic recommendations and reports.
And it did one on competition in effect competition advocacy
called Competition Assessment Toolkit. And by the way, in twenty nineteen,
the US delegation to the OECD under President Trump, voted
(33:11):
in favor of accepting his toolkit for use by OECD members.
And the four points they say, look, you should look
at in finding any competitive regulations. One regulations that limit
the number or range of suppliers. Two limit the ability
of suppliers to compete. Three reduce the incentives of suppliers
(33:34):
to compete. And four limited choices and information available to consumers.
And it's got then a lot more granular detail and
it's and it's got second and third volume nitive's technical guidance.
So people say, okay, those are good principles, but how
do I know how do apply them to major regulations
(33:55):
in my agency? You look at the volume and it's
very very detailed, very good and it can be used
for issue spotting, not necessarily say how bad things are,
but to quickly. So I think that would be very
helpful in fact for use by agencies, particularly since the
(34:15):
United States has endorsed it officially, and in fact OCD
members including Canada, South Korea, Mexico, Greece, Isan, Romania, various
Asian countries Brazil for better Wars have tried to have
applied the toolkit. So I think that's something to think about.
(34:38):
If you get the complaint, well, give us more detailed guidance.
You don't have to get any economists that the old
RFTC to right up the guidance. It's already been written off.
And by the way, the economist in charge of that
is of American PhD economists who served six years in
the Anti Press Division from I think nineteen ninety nine
to two thousand and five, and so that is very helpful.
(35:04):
And I also talk more generally, but this is probably
less direct applicability about an econometric model that Singham and
others have developed to try and see how particular regulatory
structure is. This taught property rights protection, domestic competition, and
international competition, and I think those would be useful more broadly,
(35:27):
really in sort of a planning exercise by the government.
But there is one guy I would highlight. There is
a doctor Casey Mulligan, who is expected to be confirmed
as Chief Counsel for Advocacy in the Small Business Administration.
He's a professor at University of Chicago economist was specialized
(35:50):
in assessing the costs of regulatory systems. He testified several
times before Congress in two thousand and one to twenty
three about the costs of the last administration's regulatory programs,
and he has says the real problem is that people
are going to say, well, let's look at the costs
(36:12):
of delays filling out paperwork. He said, no, the main
costs really are distortions in the market, and there are
ways of estimating that. It's wrong to think that you can't.
He gave the example in an interview I had with him.
I think a couple of federal regulations whose real negative
impact was perhaps a thousand times larger than the paperwork
(36:34):
costs which had been estimated by OMB at one point
in the Biden administration. So I think there are tools.
It's a tough thing to do. But since it's some
sense all of government. I would I'm putting in a
shameless blug here. I hooked doctor Mulligan, who's worked tirelessly
(36:56):
on this area. His brain might be tapped by folks
at the OJ and FC.
Speaker 4 (37:01):
Well, of course, I think I think Casey was was
in the White House, uh during the first Trump administry,
was so hopefully, hopefully his use get picked up by
by the agencies. Uh, Kathleen, you touched on this, maybe
i'll less you expand on it. What other opportunities do
(37:23):
you see for both the agencies and private parties or
associations or everyoneant to call it too to play in
this area? Right? I mean, I'll just make a personal note.
When I was head of the Office Policy Planning at
the FEC, you know that office does a lot of advocacy. Uh,
(37:46):
lots of times we are alerted to things by you know,
by third parties, by affected parties, by firms who may
may be in a sense harmed or excluded from markets
by by regulation, by legislation or new rules or interpretations
or rules. So what how else do people playing and
(38:06):
what other opportunities are there? Yeah?
Speaker 6 (38:09):
So I think it is really important that the FTC
and DJ continues their advocacy at the state level to
avoid anti competitive state legislation and state regulation, and I
think it's really important that they continue to push back
on exemptions and immunities in the courts. There's a long
(38:36):
history of DJ and FTC doing that. We've we mentioned
North Carolina Dental earlier, So I think that's another significant
component of what the DOJ and FTC can do here.
But I also think we can't underestimate the power of
private anti trust enforcement. Now. Not everybody has the resources.
(38:58):
Sometimes you're talking about a small group or group that
doesn't necessarily have the resources to bring a big anti
trust case. But class action and private other kinds of
private anti trust enforcement have the potential to really be
a good supplement here where way past the days if
(39:20):
those days ever existed when the private actions were follow
on suits to d o J cartel investigations. And we're
I think in a new stage of private anti trust
enforcement now, and I think a lot of advocates of
smaller government and deregulation, et cetera, are starting to see
(39:43):
a lot of folks are writing about private actions as
a tool that allows maybe more of this public choice aspect,
and private plaintiffs can point to places where there are
competition issues, the companies being advantaged by bottleneck by bottlenecks upstream,
the consumers hurt by high prices. The market in some
(40:07):
ways selects the plaintiffs. I would just point to in
our case, we did a recent Amikus in a thirty
three forty B case where and this is this is
a program that allows for low cost drugs to certain communities,
(40:27):
and the case pointed to a competition problem. There a
potential conspiracy among the pharmaceutical companies to restrict thirty three
forty B drunk availability. But on the flip side of that,
there's also a question of who can participate, and maybe
the regulations are too restrictive on who can participate in
(40:50):
this three forty B program. So that's just an example
of where, you know, things that come up in private
litigation can point you to where the competition problems are
and they have a really important role in enforcing and
doing a market based job.
Speaker 4 (41:08):
You know. Before before we move on, I want to
note too, although this was not an anti trust violation,
I want to note that during the Biden administration, the
FTC did a study short study of the infant formula industry.
And I think that study, while I you know, identified
(41:30):
government regulations that seemed to limit the number of firms
I could participate in the government you know which program
for formula. And you know once when one of those
plants went down, that had a significant effect by a product. So,
you know, I think that's interesting. I found that the
(41:51):
i'll call it the so called progressive movement on it,
and I trust it was at least a portion of
that movement that seemed called with allowing UH employees outside
the context of unions or professionals outside the context of
unions to get together through trade association codes or professional
(42:15):
licensing bodies UH to limit competition. But at least some
at least some of the folks on the left in
the previous administration, you know, we're we're open to removing
or at least to identifying regulatory UH barriers to competition,
(42:38):
including you know, government rules, government rules. But well, then,
before before we turn to questions from the audience or
even the end of the program, I'd ask you to
kick off a discussion of you know, how, how does
how do the agencies? How does the government do some
(43:00):
of this deregulatory effort quickly, right, I mean, I think
of deregulation as sort of requiring, you know, notice and
comment processes under the A P A. But at least
there's a strand of the thought that says lower bright
the decision of Lowerbright removing or overturning Chevron can allow
(43:27):
for speeded up deregulatory efforts. So all, maybe I'll let
you kick a discussion off there and then ask Darling
Kathleen for comments.
Speaker 1 (43:35):
And I can I before we get into that process, point,
can I just respond to two points from all that
and Kathleen in the last topic?
Speaker 4 (43:44):
Sure? Sure.
Speaker 1 (43:45):
So I wanted to address because it's timely, the comment
on the internet of the OECD report without taking any
view on that report, because the OECDB needs are happening
next week. And I think this deregulatory advocacy is an
important important part of the Anti Trust mission, right, anti
trust and trade policy are not so separate and many
(44:06):
other places in the world, and I think nor regulation,
and so I think educating the broader community on the
impacts of anti competitive regulations is an important part of
the division's mandate. And I know it's something that my
colleagues are focused on in those meetings. So I just
wanted to sort of second the importance of those initiatives
(44:27):
that all of them raised, and then on the exemptions
and immunities which Kathleen talked on. Agreed that the sort
of limited construction is important, and we, since I joined
the Division, have filed the statement of interest in the
Black Rock ESG. Case, which it's not a pure regulatory
exemption but it's a passive amester exemption in the section
(44:48):
seven the Clayton Act. And so I think that is
a case where sort of continued advocacy of limited exemptions
is an important part of the advocacy efforts. That's also
an interesting factual context, right, because it's an example where
I think the attack on coal sort of had two prongs. Right,
there were federal regulatory initiatives like the Clean Power Plan
(45:09):
that were struck down in the Supreme Court, and then
there were private market conduct that was alleged in the
complaint from Texas, where at least as alleged, right, there's
activity at the private level that is reducing output amongst
coal companies. So I think that's a good way to
sort of view antitrust in deregulation or at least regulatory
(45:31):
review as sort of complementary tools. I just wanted to
add that.
Speaker 4 (45:35):
All right, super so, so all then can you just
touch on you know, the basically what I think is
the effect of lower bright.
Speaker 3 (45:44):
Or okay, Well, there is an exception to require notice
in comment or withdrawing your rule. According to the APA says,
the agency can forego notice in comment when it finds
good cause that notice and ment are impracticable, unnecessary, or
(46:05):
contrary to the public interest. Now, contrary to the public
interest may be helpful. It applies when the prior notice
would undermine the rules of effectiveness or the underlying satutory scheme.
And some of the audience may know. Local Bright basically
said that the courts are the ultimate federal courts interpreter
(46:27):
of the meaning of rules, and that there will not
be difference to an end to reading of U. When
there's a so called set for ambiguity AH, an interpretation
by the agency will not be deferred to. The courts
will say, is this regulation and the fact or rule
(46:49):
you know, the best reading in effect of the statute.
So in many cases may be possible to say that
look in some areas, let's say not the cerily DOESTPA.
But there have been some very broad interpretations of the statute,
like the meaning of waters of the United States in
environmental regulation or land use regulation. And in many cases
(47:12):
it may be possible to say consistent with the public interest.
We find that these readings of the statute are due violence.
They're not consistent with the stat with the statutory scheme
at all. And therefore we feel that you know our
duty to take care that the laws be faithfully executed.
President's duty that we eliminate this rule because it really
(47:36):
does not It wasn't justified in the first place as
a matter of statutory construction. Now the problem is you
you're not always going to be able to do that.
Some constructions you just may may be consistent with the
statute because the statute wanted to limit entry and the
regulation sort of close. So the question is, is contrary
(48:02):
to the public interest?
Speaker 4 (48:04):
Uh?
Speaker 3 (48:04):
Can you make a different readings, say this inconsistent the
rules of effectiveness? There there's is it impracticable to really
if you believe a competition is a general policy, so
they may be so low for bright decision may be
helpful in allowing uh, some rules to be quickly pulled
(48:27):
without bills that comment, but not always. And then you
can challenge that there will be challenges in federal district
court on saying that well, pulling the rules are turring
capricious and in the United States, with the correct lawyers
from Justice depart and so on, I think we'll be
on the spot to explain why a particular withdrawal was
(48:48):
not arbitrary and capricious. I mean, will the sacred reasons
a good call? There needs to be a statement of
the reason sessifying by passed and notice of comment and
some but so but as we've seen in recent months,
sometimes district courts are showing prelection for trying to stop
(49:11):
activity by uh uh the administration that it believes that
stat's totally justified to want to take. So we'll just
have to.
Speaker 4 (49:19):
See, un think, Charlie, any reaction to you know, sort
of the you know, the process by which is the
regulatory effort might right, might take books. And then I
have a very good question from the from the listeners.
Speaker 1 (49:35):
I will leave that to the much more adept experts
in the federal programs than other divisions of the Justice Department.
I'm happy to circle back to something you said earlier
on the formula, not comment on that case, but on
a larger principle. But I'll let Kathleen comment.
Speaker 6 (49:52):
Well. I also don't want to wade into administrative law
areas that I don't have expertise in, but just as
a little bit of an aside there, since we brought
up Looper Bright, I think they're you know, looking through
the comments, I will note that there's a lot of
(50:13):
discussion in the comments about the non compete role and
the importance of of of not of being very careful
about non competes in many cases, not restricting them altogether.
So I guess there are two sides to that issue.
(50:36):
Since I think folks may be concerned that the non
compete role and Loper Bright might collide at some point, I'm.
Speaker 4 (50:44):
Going to comment on that, but I'm gonna I'm going
to ask Charlie to comment as as you asked, I don't.
Speaker 1 (50:51):
I don't want to comment on that specifically, but I
can comment all on the without sort of taking any
position on the merits of the investigations that the fact
sort of the factual circumstance to describe there. I think
is one that you know, could occur in many other industries,
right where there's a regulatory regime in place. And I
(51:12):
think the hard thing from an anti trust enforcer's perspective
is to understand, you know, is the when the exercise
of market power is coming from a government grant of
monopoly or some regula, some market power derivative of that
government regulation. Where is there an anti trust violation and
where is there just an abuse of an anti competitive rule.
(51:34):
And I think that's where anti trust and deregulatory reform
can be very good compliments, right because rather than attempting
to use anti trust to sort of get at quasi
exclusionary conduct, you can use deregulation to just as to
use the metaphor that Kathleen alluded to that the age
slater is used, right Scalpel, and just cut out the
(51:56):
anti competitive regulation. And then I think, ideally, right you
would not have to sort of stretch anti trust to
broader conduct. But I think it's a hard question, but
it's one where the deregulatory initiatives can work in tandem
with anti trust to combat anti competitive conduct.
Speaker 4 (52:15):
Okay, So I want to get to one of the
questions and then I have a question too. But I'll
also throw something out, Charlie in response or maybe as
a related to what you mentioned. When when the FDC
and DJ drafted the twenty twenty Vertical Merger Guidelines, there
was a comment I believe by one of the FTC
(52:38):
Commissioners that the twenty twenty Vertical Merger Guidelines failed to
include a discussion of regulatory evasion as a form of
harm that may come up in vertical mergers. I think
it was also excluded or not really referenced or incorporated
into the twenty twenty three merger guidelines. And i'll i'll
(53:00):
note that the one reason it was not included in
the twenty twenty vertical Merger Guidelines, that is, regulatory evasion
is a theory of harm, because there was a view
by by some of the drafters and participants that that
theory of harm is not really an anti trust theory
of harm, but a theory of you know, well, a
(53:25):
concern that you know, this was an issue for regulatory
agencies to address, you know, if if they're if their
rules could be gained you know. Yeah. So, but I
just throw that out there because I think it is
important to think about again as the agency goes forward. Right,
(53:45):
we have a whole theory of harm and associated with
vertical mergers that appears to focus not on conduct arising
from the merger, but on the regulatory framework that allows
the evasion to occur. So, so, Mike, Mike Murray asks
(54:06):
a very good question something we hadn't talked about in
our in our prep What about the development of standards?
Standard setting? Standards can be both pro competitive and an
anti competitive barrier, right, are the but this way should
(54:27):
the agencies be thinking about the standard setting process? There
were you know, in the UH, in the in the
Reagan administration and of course prior but in the reagul administration,
there was some interesting standard setting cases. Uh, there was
standard setting issues in the U in some of the
(54:49):
case like in the Rambis case that the FDC board.
Now over twenty years ago, we haven't seen a lot
of standard setting stuff coming out of the agencies in
the past two decades. Should should we see more?
Speaker 3 (55:02):
Well, let me just note Assistant Attorney General delaheen Uh
in the first Trump administration was concerned. One of concern
he said, was that the standards process, where you had patents,
standard es, central patents being developed, that there might be
uh you know, anti competitive rules to restrict returns, to
(55:25):
limit returns to the holders of patents included in standard
might be a source of ANNI trust concern. On the
opposite side of the spectrum, I think in the UH
at the end of you Obama administration, there had been
stated concerns about that standards should be developed h in
(55:46):
ways that prevented an effect AH anti competitive hold up
by patent holders. Who's who's after the fact. His patents
after the fact was said to read on the standard.
So certainly there's been given some thought was given to
standard setting from two different perspectives in in in recent administrations,
(56:10):
but more broadly, as if for law set, certainly there's
a The Supreme Court has told us that that exclusion,
any competitive exclusion to procedural hygienks uh can can could
violate the anti trust laws that was decades ago. So
uh yeah, I think it's standard setting is always worth
(56:32):
looking at.
Speaker 6 (56:34):
I would agree with that, And I think standard setting
and the problems of self regulate regulating bodies that kind
of act as regulators at the state level are similar.
Where you have the potential for AH entities that can
stand to benefit from restricting the market or including their patents,
(56:56):
et cetera. There's always a role for UH outside correction
to make sure that those conflicts don't that those interests
don't result in anti competitive facts.
Speaker 4 (57:10):
So we have we have just a couple of minutes left.
I'm gonna throw a question out that and maybe even
a plug that I some of you know I have.
I have a podcast Forethinking and I Trust, and the
next the next episode is going to be a discussion
with Katie Ambrosi, formerly of the FDC's Office Policy Planning
(57:32):
and other parts of the FTC. We talk a lot
about healthcare restrictions regulations in the healthcare space that have
the effect of limiting competition. Of course, they may they
may have positive reasons, you know, safety and health, but
I think the ones we talk about are mostly focused
on protecting incumbents from competition. And one of the things
(57:54):
we talk about, which I want to raise with with
the three of you, is should merger review process be
used to remove restrictions on entry?
Speaker 6 (58:08):
Right?
Speaker 4 (58:08):
I mean, there's a lot of talk about moving to
moving to back to divestures as sort of the you know,
preferred to the litigation to address deals. One thing that
I think FUK did in the nineties after the nineteen
(58:28):
ninety two Energy Act was used the merger approval process
to deregulate or require divestiture across across sort of the
three lines of activity to bring competition into the electricity space.
(58:50):
Can should Should the agencies look to remove restraint restrictions
on entry as part as part of the vestiters And
I'll give the example. I'll give the example that I
think relates to something Kathleen that you said, which is,
you know, hospitals, employees of hospitals, including physicians and also
(59:15):
employees of physician group practices probably operate on their non
compete agreements, you know, physicians especially, Should the agencies be
thinking about as a condition to approval of hospital deals
and you know, physician group practices deals and maybe some others,
removing restrictions on the employees noncompete restrictions on the employees.
(59:38):
This would get around perhaps the limitations of a noncompete
rule to you know, in areas where you see potentially
real shortages of entry or real shortages as a supply. So,
should they use the merger review process to remove impediments
(01:00:02):
to entry by market participants or potential marketing.
Speaker 6 (01:00:08):
Well, I do have a concern that that could be
I could see a use for it, but I also
think that it could be a reason to approve something
that shouldn't be approved. So I don't think we should
be compromising the merger review process or letting things through
because we've there's a condition on it that would ostensibly so.
Speaker 4 (01:00:32):
It can be a compliment, not an all tournaments. Yeah,
your points a good one. Your points a good one,
but also be thought it as a compliment.
Speaker 6 (01:00:41):
Yeah, I agree with that, and I think we just
have to be sure that it's staying in the realm
of merger economic analysis, because I think there can be
a temptation to go outside that.
Speaker 3 (01:00:55):
Yeah, there has been a critique, and I see that
you're pointful at that the husband a critique about trying
to shoehorn non merger related problems into a merger into
a merger settlement, that that there is that legitimate role
for the agency to be playing. If the agency is
a concern about some other aspect that's extraneous to the merger,
(01:01:19):
you shouldn't. So there's that contrary argument, and I haven't
thought at debts about that, but it seems to me
there's some conflicting thoughts.
Speaker 1 (01:01:30):
Well, I answered a little bit around it that way,
which may not be fully satisfying, but I think is responsive.
If you look at Deputy's this Attorney General Bill will
Bill Renner's comments and speech on merger remedies that he
gave a GW a week or two ago, I think
it focuses a lot on the Tanyact context in which
murder merger settlements take place. And one of the points
(01:01:53):
he made in that speech is that that discipline's enforcement.
So to follow on Kathleen's last point, right, you know,
to the extent that and enforcement action is predicated on
Section seven and not broader issues, right, I think that
Taniac structure gives some discipline to the process on you know,
a hard question.
Speaker 4 (01:02:14):
Okay, So I think I think I think we are
just after one. So unless there are any other comments
anyone would like to make or questions from the from
the attendees, I think I think we're about to close out.
Is that is that right? Leby?
Speaker 6 (01:02:31):
Yes?
Speaker 5 (01:02:32):
I think that just about wraps it up. But thank
you so much for moderating, Belall, and thank you again
to everyone on our panel for joining us and for
sharing your insights today. Thank you also to our audience
for tuning in and for your excellent questions. And for
more content like this from the Regulatory Transparency Project here
at the Federal Society discussing the regulatory state and the
(01:02:52):
American way of life, please visit us at regproject dot org.
That is our e G reg project dot org.
Speaker 1 (01:03:00):
Thank you so much, Thank you, Thanks.
Speaker 2 (01:03:02):
Everybody on behalf of the Federal Society's Regulatory Transparency Project.
Thanks for tuning in to the Fourth Branch podcast to
catch every new episode when it's released. You can subscribe
on Apple Podcasts, Google Play, and Speaker For lays from
our TP, please visit our website at regproject dot org.
That's our egproject dot org.
Speaker 6 (01:03:32):
This has been a FEDSC audio production.
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