Open Minds with Andrew Ferguson and James Burnham

Episode Transcript
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Speaker 1 (00:03):
Welcome to Open Minds, a freedom of thought podcast series
interviewing the people who bring courage and independent thought to
the challenges of today.

Speaker 2 (00:12):
I'm James Burnham, You're Andrew Ferguson. You're an FTC Commissioner.
I'm just a guy who has a law firm that
doesn't do much all right, supering friends for a long time,
and I've had the pleasure of following your career for
a very long time, and I thought we could start
with just some like basic biographical background stuff. So first,
you know, where'd you go to law school and what
was your first job out of law school?

Speaker 3 (00:33):
Hi, thank you for having me here, Alita, thank you
for the invitation. Just before we get started, make it
very clear, i am a commission on the FTC, but
I'm here in my individual capacity. I speak only for myself.
I don't speak for my colleagues on the Commission. I
don't speak for the Commission, and I'm not here to
address any like matters pending in front of the in
front of the Commission. UVA for undergrad and for law school,

(00:55):
and my first job is clerking on the DC circuit
in twenty twelve, so it was right before the big
filibuster fight in the Senate about adding four Democratic judges
to the d C circuit, So it was like the
tail end of the like Republican admin law heavy DC
circuit before that sort of shifted to the fifth circuit.

Speaker 2 (01:16):
So you were gone when it shifted.

Speaker 3 (01:18):
They were arriving as I left. The filibuster had been
blown up. The Judge Tryan of Boston had already been confirmed,
but the other three, you know, they were arriving as
I left, So the court was radically changing on my
way out the door. How did you clerk for Karen Henderson?
Who'd been there since the early nineties, She took ken
star seat. She'd been a district judge in South Carolina,

(01:40):
was part of the like Bush Reagan Reagan Bush remaking
of the d C circuit, which is what made it
the kind of ad law heavy circuit that we used
to think of that And.

Speaker 2 (01:48):
When you were done with Judge Henderson, what what did
you do after that?

Speaker 3 (01:51):
I went to Covington right after and practiced anti trust
law for like a little over a year, and then
I went from Covington to Bancroft, which at the time
was the law firm for Paul Clement and via Den,
where Paul was doing like his five arguments a year
before Kirkland bought it and was there for like a
year and a half.

Speaker 2 (02:11):
Why do you want to move from Comington to Bancroft.

Speaker 3 (02:15):
There are a couple of reasons. Part of it was
just sort of like fortuitous timing. Bancroft had an associate
opening because every year they would lose a bunch of
associates to the court that they were like going to clerk.
I also went to clerk after Bancroft, and when I
started Bankcroft, I had the clerkship, so it was like
the they called it like the Bancroft Fellowship for people
who were about to go clerk. There was an opening.

(02:35):
It was exciting. You know, Paul very famously had gone
to Bancroft because he refused to give up representing the
House of Representatives in the DOMA case. I'm a conservative
and Republican and Paul was sort of like the leading
and still is the leading appellate light on our side,
and it was, you know, seemed like a once in
a career opportunity to do very heavy appellate law at

(02:56):
the highest possible level outside of like the US Solicitor
General's Office.

Speaker 2 (03:00):
So I know next you went to clerk for Justice, Thomas,
did you already have the clerkship when you jumped to Bancroft?

Speaker 3 (03:05):
I interviewed.

Speaker 2 (03:07):
I'm sure he liked that the ord to Bancroft.

Speaker 3 (03:08):
He didn't mind. I interviewed with him before I got
to Bancroft, and then he gave me the job like
very shortly after starting. And I was at Bancroft for
like a year and a half and then went to
clerk for Justice.

Speaker 2 (03:21):
So what was it like with with the greatest living American?

Speaker 3 (03:25):
Thank you for saying that he is the greatest living American?
It was awesome. Like your audience probably knows this by
now that you clerk for justice courses, so you get
kind of what the general thing is. But you know,
he's a like he's sort of like a living legend
in the real sense. He has like a personality it's
larger than life. But his reputation is, you know, he's
like a household name, and it's very rare for anyone

(03:48):
in our positions to be around a household name.

Speaker 2 (03:51):
And was Scalia still there?

Speaker 3 (03:52):
Scalia had just passed away, so you weren't the term
he died, but the term after I was the I
was the term where when President Trump won the election
and justice courses arrived.

Speaker 1 (04:01):
What was that like.

Speaker 3 (04:03):
The first part of the term, when it was just
a justices was it was very collegial. Most of our
cases were pretty boring because they were taking cases that
were unlikely to deadlock at four four. You know, we
had some cases that kept getting I'm not revealing anything
from the inside. The calendaring is public, but there were

(04:24):
cases that were kind of like not being calendared even
though they'd been granted. And then when you know, so
we all the clerks got along like supremely well. Our
cases were interesting in the loyally sense. They were like
technical statutory questions.

Speaker 2 (04:40):
I mean like they were law.

Speaker 3 (04:42):
That's right, that's right. Yeah, they weren't social policy with
seventy briefs. It was like law. It was like technical
statutory interpretation questions. Weird procedural stuff like IP heavy because
there was IP stuff that needed resolving, and those kind
of divide the court seemingly randomly anyway, and so that
that's the kind of thing you can do with eight justices.
But you know, our happy hours were great because we

(05:04):
all got along and everyone was kind of happy. The
election was the result was unexpected. It sort of changed
the tenor internally a little bit for the whole country,
that's right, Yes, yeah, probably even more for the whole
country than for our weird, little, you know, cloistered existence

(05:25):
at the Court. And then there was the super interesting
dynamic of like, you know, the primary that you know
you were involved with working for President Trump, but like
who was going to get the seat? You know, all
of us new people in the White House, and we
were trying to you know, feel out everyone for Judge
I know, she wasn't on the list, I know, and

(05:45):
you guys have made a promise the American people say
the list, and then you know Justice Scorsish being picked.
All of us would like watch his confirmation hearings in
the background while we were doing our work because this,
you know, this guy was likely to join the place
we were at, and I think the clerks are probably
more into the like confirmation hearings, and the justices who
all had gone through themselves and had been doing this

(06:06):
for a long.

Speaker 2 (06:07):
Time, I'm confident they never want to see them evert.

Speaker 3 (06:10):
And then he arrived and so it was you know,
there's lots of ceremonies, and it was it was cool
because it doesn't happen very often. And like, you know,
the Court just since ninety four had only added two
new justices, just Justice is Sodamayor and Kagan. But since
Bryer had joined, the court had been like pretty it

(06:31):
is Nuts had been pretty consistent. He was like the
junior justice for eleven years. You know, it's nuts. And
Justice Gore Sitch arrived and he arrived with his clerks,
all of whom I'm very close with now, but who
were like a lot older than most of us. Most
of them had clerked there already and then had like
pretty interesting careers and big personalities. So like Justice score

(06:52):
Sitch arrives, his clerks arrive, and they're just kind of
like causing mayhem. We had all been there for like
ten months. But then you know, like they calendared Trinity Lutheran.
After Justice Corcius arrived, the big first Amendment case, we
had the first travel band case on the emergency application,
where the court upheld much of it and five to

(07:13):
four struck down part of it. But yeah, you know,
it was a super interesting term that changed really, really
dramatically in.

Speaker 2 (07:21):
The sore saying Mike Davis didn't trigg in perfectly immediately
rhyming at the court.

Speaker 3 (07:27):
Mike and I are super good friends now and super close,
and he knows the story because I have told I've
told him it his fortieth birthday. But we got lunch
with the Corsich clerks, probably their first week there, and
three of them seemed they'd already clerked there before, one
of whom I'd known for a while, and they seemed

(07:47):
like totally normal. And then there's this guy who was
saying like off the off the wall stuff, like seemingly
out of the blue, hyper aggressive, and we were like,
who is this guy? And for the first you know,
like two weeks, I was like I don't even want
to be in the same room with this guy, Like
he doesn't understand how he work here. Then after I
bout him off, was like, oh, he does understand very

(08:08):
much how we work here, better than I do, actually,
and I could probably learn something from him. And then
I ended up working for him. So but yes, it
was like it was it was a lot happening.

Speaker 2 (08:15):
That's great. So you went from there to Sidley right
talk about that, and then you know what that was like,
And how'd you pick Sidley?

Speaker 3 (08:24):
So Bankroft didn't exist anymore, it had been absorbed by Kirkland,
and I wasn't quite sure what they would have wanted
me to do it Kirkland, and so I decided not
to do Kirkland Sidley, partly because you know you've seen
this too. But like you interview around after a clerkship
and they all like, promise you, we'll let you do
whatever you want. But then you can talk with people

(08:46):
who are actually at the firm and get a more
realistic kind of perspective on what they're actually gonna let
you do. And I wanted to do any trust, but
I didn't want to do just deals. I wanted to
be able to litigate too, And Sidley was the only
one that seemed meaningfully admitted to letting me do both
kind of traditional anti trust counseling and deal work and litigation.
And I was only there for like eight or nine months,

(09:07):
but they did in fact let me do both. I
mean I helped run deals and was also one of
the senior associates on the AT and T time Warner
merger trial, which was like AT the time, the biggest
vertical merger challenge the government had ever undertaken. It was
like a ninety billion dollar merger or something.

Speaker 2 (09:23):
Yeah, so why are you only there for eight or
nine months? What would you go?

Speaker 3 (09:27):
The same Mike Davis months before. So Mike left the
Court and went to be then Chairman Grassley's Chief Nominations Council.
And he'd asked me to come with him, and I
was like, I've got law school debt. Like, I don't
know what your finances are, but I do not come
for enough money where I can just like do fun
stuff when I have the Supreme Court bonus, sure, which
is admittedly a racket, but a racket I was happy

(09:49):
to benefit from staring in the face. But you know,
if Judge, if Justice Kennedy retires, of course Mike, I'll come, like,
I'll come help you do that.

Speaker 2 (09:59):
Little did I know? So oh sure, because right very
next year.

Speaker 3 (10:03):
Yeah, yes, that's right. So you know, end of June
twenty eighteen, President or Justice Kennedy sends his letter to
President Trump announcing that he's leaving. And I mean a
couple hours later, Davis is on my cell phone, going,
you promised, And I was like did I, And so
I I'm sure he had other words he had had

(10:24):
around that, Yeah, he had, he had plenty of words.
And so I went to the folks at Sidley, who,
to their ever living credit, I was like, look, I'd
like to do this. I'd like to go on the Hill.
And we didn't know it was going to be Judge
Ben Judge Kavanaugh at the time. This was before the
President had announced his the nominee, with which the selection
process you were super heavily involved. And the folks at Siddley,

(10:46):
to their credit, were like, yeah, you know, this is
super important for the country. You don't get to do
things like this very often. You know, consider us when
you leave the Hill again. But you know we're not
gonna We're not gonna get your way. We think this
is great, go do it. And a lot of it
we're friends with with then Judge Kavanaugh. So when he
was announced, they were even happier that that that this
was going to happen. So I left Sidley for what
I thought was going to be like a three month

(11:08):
you know, grind. But I thought I'd seen these before,
and you know, we would confirm then Judge Cavanaugh, and
and and you know, hopefully move the court in the
direction that you know, you and I had wanted it
to go. It obviously turned turned into something else.

Speaker 2 (11:25):
Why don't you just talk a little about the confirmation
process of Judge then Judge now Justice Kavanaugh. You know,
were you on the boat in Rhode Island where there's
the incident, reported yourself in the White House. I mean,
you'd just give us a little a little of color
to that insane process.

Speaker 3 (11:41):
The like I mean, you know, and I'm not telling
you anything you don't know because you were as in
it as I was from the you know, from down
Pennsylvania Avenue. But the first couple of months it was
kind of boring, which was helpful to what we're trying
to do, because the fight was basically like a litigation
discovery thing documents, right, and the American people quite correctly

(12:01):
had no interest whatsoever. And it was about, you know,
Judge Kavanaugh had been in the Bush administration for like
six years, he'd been very high up. He had generated
a tremendous amount of like email and and and documents.
And the Democrats, partly I think because they did want
to read them, and partly because they thought it would
take a long time to get through them, which it
would have wanted, you know, all of them produced. And

(12:23):
so for the first couple of months, it's like a
discovery fight, which I had just been doing in private practice,
so I kind of just like read it like a
discovery fight, and it was great. And then you know,
the story breaks shortly after the hearing, and then it's
just you know, insanity, like literal insanity, like you know,
huge crowds screaming at us inside the Capitol complex and

(12:48):
a lot of people forget this. But like even the
first day of Justice Kavanaugh's hearing, there were like dozens
of disruptions and that was just over documents.

Speaker 2 (12:58):
I mean that those sound like an obstruction of official
proceeding if it doesn't require evidence impairment. But I won't
ask her about that.

Speaker 3 (13:04):
I mean, it wasn't official proceeding, and it was repeatedly obstructed.
I want to count for the difference of treatment of
other obstructive proceedings, but you know, that is what it is.

Speaker 2 (13:14):
Uh.

Speaker 3 (13:15):
And then you know the you know, we we helped
find the like prosecutor.

Speaker 2 (13:19):
Where'd you find her?

Speaker 3 (13:21):
So this is her name, Rachel Mitchell, who's she's now
the county attorney for Maricopa County. She's like the prosecutor
for Americapa County. She beat a Soros prosecutor in a
very tight race in twenty twenty two. Yeah, Rachel's amazing.

Speaker 2 (13:35):
This.

Speaker 3 (13:36):
The story about how she came to my attention was like,
I don't want to name the who the names are,
but like basically people connected to the Arizona delegation kind
of thought of her and proposed her and and I
interviewed her and she seemed great, and.

Speaker 2 (13:49):
Then we interviewed Flake was yeah, we wanted someone who like.

Speaker 3 (13:52):
Yeah, exactly, and so you know, we we we brought
her up and we prepped her for these It like,
you know, sort of cuckoo hearing. Uh, you know, SNL
has become kind of a sad thing.

Speaker 1 (14:08):
But the.

Speaker 2 (14:10):
Oh my gosh, it's so funny. I recommend it to everyone.

Speaker 3 (14:14):
I watched it Sunday morning before church. Ali million people
texted it to me. And at first I watched it
expected to be mad and a it was just hilarious
from beginning to be like, not inaccurate, and it wasn't nasty.

Speaker 2 (14:28):
It wasn't that it was like and plus Matt Damon's
like very charming. The whole thing was just right. Okay,
so this he did that, and then you were you
were in the Senate for a while longer, right, so
so not you were not ready to give up or what?

Speaker 1 (14:42):
Well?

Speaker 3 (14:42):
Sort of I so that ends. Don mcanth the White
House then hires me to come to the White House
on a date to be determined once the clearance stuff
was all done. But then the President removed Don from
his office.

Speaker 2 (14:56):
I didn't even know that that's interesting.

Speaker 3 (14:58):
This was this is Annie Tally's idea.

Speaker 2 (15:00):
Yeah, that's a good idea.

Speaker 3 (15:02):
Yeah uh. And then I interviewed with Pat Sipoloni, who
wanted me to come join again. But there was this
like long you know, Pat's security Clarence got hung up.
Everyone security Clarence always get hung up. But Pat didn't
want to start until security apparance was done because he
didn't want to be like at the beginning administration, where

(15:23):
people would start and then there'd beat security Clarence problems
and that can be very complicating. And so there was
this sort of like period where I was not employed
by anyone. I had planned to go back to Sidley,
but then got this White House offer, which I had
again from from Pat Sipoloni, but I wasn't sure when
it was going to take place because it was he
was going to start. And then the day that Pat's
assistant called to tell me what they thought my start

(15:46):
date should be, I got to reach out from Lindsey
Graham's staff asking me to come run noms for him
because he was about to become the chairman Attorney General Sessions.

Speaker 2 (15:56):
Had Davis was done, Davis was he was going to
go to chase Michael Avenadi.

Speaker 3 (16:00):
That's right, that's right, yes, yeah, he had him on
the run. I forgot. I forgot that Mike Davis basically
like got my job and naughty in jails. Well, Michael
Abbinati got Davis drew attention to this fact, uh, And
so I went back to Well, first, I did what
I always do when I have career questions. I went

(16:21):
to Justice Thomas and was like, look, like I told
the White House was going there, this job seems pretty
important too. I'm not sure to think about it, and
he was like, you know, you're like a true believer
in this judicial project. We need that kind of person
in the Senate. So that the White House and Senate
are kind of in the same handhold they'd been with
you and Rob and Don. And so I went to
the White House and was like, I'd like to do this,

(16:42):
and they're like, go, it'd be great. We want someone
like that there go And so I went, and we
were gonna have to do We knew we'd have to
do Bill Barr because Jeff Session said, you know, left office.
We knew we were gonna do a replacement. At the time,
we didn't know it was Bill, but then we knew
it was gonna be Bill. And they wanted someone with experience,
and although I only had four months of Senate experience,
it was a lot jammed into four months.

Speaker 2 (17:01):
And then how long were you there before you moved
on to McConnell, Like six months, and then McConnell asked
you to come more.

Speaker 3 (17:06):
Yeah, So McConnell's longtime lawyer left.

Speaker 2 (17:09):
He just the job.

Speaker 3 (17:11):
John Abeg had been there for like fifteen or twenty
years or something, and then he left. He had a
prev sector opportunity that he really couldn't pass up. And
you know, there was sort of this period where because
judges were the main thing going because Congress was divided again,
you know, I was participating in meetings with mccone's staff
about who to put on the floor with the politics

(17:33):
of it, were who we need to like, you know,
play nice with to get these things done, And eventually
they said, do you know we'd take a Beeg's job.
And I was pretty hesitant, partly because I loved the
Judges project. I mean I first got interested in politics
really because I wanted to help try to get roll
overturned and congratulations. But after clerking for CT, I was like,

(17:55):
I get that the way this is going to have
to be done is you just need to change the
composition of the judiciary to get people who read the
Constitution in light of what it originally meant and not
what they prefer it means. And I was like, you know,
I want to do that. I don't really want to
do the other politics stuff. I don't think it'd be
a good at that. The judges thing I sort of
get naturally, but the rest of politics seems very complicated
and sort of outside of my Bailey wick. And they're like, well,

(18:18):
you know why you primarily do the judges thing. We
can you know, we'll work on the other stuff. So I,
you know, I talked with Leader McConnell. I took the job.
A couple months later, the Ukraine call came out and
it was clear, it seems a perfect photone call, right,
perfect though it may have been, it was very obviously
Democrats are going try to impeach him, and so I
was like, well, this job just became something like very

(18:39):
different than I thought it was going to be.

Speaker 2 (18:41):
That must have been fascinating.

Speaker 3 (18:42):
It was the first thing the day that Pelosi the
Speaker went to you know, her podium which is not
far from where my office was, and says like, we're
gonna be get an impeachment inquiry. I went to the
stat the like office manager, the like she's like the
queen in charge of everything in McConnell's office, and I
was like, do I have a book budget? She was
like why, and I said, well, I think we're gonna

(19:04):
have an impeachment trial and I like to read everything
I possibly can about it, so ready to go, and
she's like, well, not specifically, but like if you're buying
it for the job, we'll cover I bought like twelve books.
I just started like reading larvae articles to see what
the like consensus and most important monographs are and just
bought them and so my like and then I read

(19:24):
the transcript of every Senate impeachment trial. So from September
to whin the trobey and January, I was just like
all impeachment all the time.

Speaker 2 (19:31):
What was the dynamic like with the Chief Justice because
you guys, mcconnull was we had the majority, right yeah,
so I'm sure he was looking to you guys.

Speaker 3 (19:39):
Yeah, And we worked I worked closely with him.

Speaker 2 (19:42):
He used staff.

Speaker 3 (19:44):
He had one law so he used he used that.
He had two staff that worked on this with him.
One was a law clerk, Meg Brawn I think her
name was. She was super smart, like what I know, right, Yeah.
And then his like counselor the count Jef Gadget at
the time is jeffmaniir uh And and then his sort

(20:05):
of like approp staffer who had worked on the Hill
before and whom everyone knew and liked. They were like
the three people that worked this with them. And yeah,
I mean, you know, we were the majority, and so
most of the procedures we were gonna have a lot
of influence in setting because we we had the votes.
But we worked at the Chief Justice all the time,

(20:26):
and you know, he took it like incredibly seriously, as
he should. It was only the third time that the
Chief had ever been summoned for this one in the
eighteen sixties.

Speaker 4 (20:36):
And then was it.

Speaker 3 (20:37):
And Andrew Johnson was the first one, Chief Justice Chase
and then Chief our President Clinton, chief Justice Renquist, and
they were all. You know, the Senate is a body
that's run on like informal precedents. They're written down, but
they're not law. And you know, the Chief knew the
presidents back and forth. I think the fact that I

(20:59):
had clerked and so of understood the dynamic he was
confronting outside of our building as well helped. And it
helped like translate a lot of like the weird Senate
stuff to a like a justice who's used to thinking
kind of you know, very much like a lawyer and
not like a lawyer politician, which is how the Senate operates.
But it was interesting, it was it was grueling, it

(21:19):
was grinding. It was a lot packed into just a
couple of days. You know, we were going to like
past midnight. We went to like three am the first
day when we were trying to set up the procedures
and the Chief. You know, at one point he like
took his contacts out and had his glasses in because
we were going so late. But yeah, it was you know,
it was super interesting.

Speaker 2 (21:37):
That's fascinating. Okay, So you did that until you went
to the become the Virginia SG. So talk about how
that all happened, other than obviously Miara is becoming the
Attorney General Leverginia.

Speaker 3 (21:47):
So I left the hill actually to go to Jones Day.
That's right, Yeah, I think you were there at the time. Yeah,
I was, Yeah, to go to Jones Day. I was
leaving the hill, not for any particular reason other than
I knew I didn't want to lobby for my career
and I'd been on the hill long enough and I
was far enough along in my career, or I was
going to that point.

Speaker 2 (22:07):
When we lost the election, it's not as fun to
be There was a There.

Speaker 3 (22:09):
Was also that, I mean, you know, and you know,
we had another impeachment, you know in twenty twenty one two.

Speaker 2 (22:14):
Did the Chief come back for that?

Speaker 3 (22:16):
He did not, because we were not trying the president.
That's how the Senate decided. So the President pro Tem
senaer Lahy presided.

Speaker 2 (22:24):
I'm sure the chief was really disappointed.

Speaker 3 (22:27):
Yes, yes, yeah, I'm sure he was aching to come back.
And so I left to go to Jones Day because
I wanted to basically start litigating again, because that's kind
of when I spent my career. But I took some time,
like a couple months off between jobs. We went to Sicily,
like you know, it was a good trip. It was
an awesome trip. And then the last couple of weeks

(22:49):
of what was supposed to be a break was this
twenty twenty one election in Virginia. Republicans looked like he
had a shot. So I just like volunteered on the
Younkin campaign, just as a like, you know, like volunteer
campaign lawyer. Uh. And then we won. And I got
a call that night from someone close to the Attorney
General who was like, do you have any interest in

(23:10):
being Virginia SG. And I was like, honestly, I do not.
I'm I spent a lot of money I don't have
just gallivanting around Europe. I haven't made money in a
long time. I've spent the bulk of my career either
clerking or on the hill. I'd like to go make
some money. And they were like, well, give it some thought.
I interviewed with the AG. We hit it off. I

(23:30):
still wasn't quite sure. And then I talked with Justice
Thomas and he was like, buddy.

Speaker 2 (23:35):
He's gonna he's gonna keep pushing you back in.

Speaker 3 (23:37):
I know, I know, and that's right, and he will
and we'll talk about that in a minute. But it's
the same dynamic. And he was like, you know, you
never Virginia hasn't been Republican in a long time. This
is your You grew up here, you were born there,
you were raised there, you're educated there, you live there.
Like when are you gonna ever have this chance again?
And I was like, you're right. So the AG made

(23:57):
the offer. I accepted, uh, and and that was that.
But as is normally the case, when I have some
sort of like career thing, I go to to the
Age or I go to Justice Thomas and like, you know,
I've had a bunch of jobs since law school. I
don't stay in one place very long, but every single
job change is like super risky. I mean you know this,
you your changes are you more dramatic than any in mind?

(24:18):
And you went from like partner at a you know,
am law ten law firm to like running this like,
you know, cool new thing you're doing now which is
law related but has very little do with like the practice.

Speaker 2 (24:31):
It's quite different, that's right.

Speaker 3 (24:33):
Yeah, And so you get you you like, you end
up with your little like coterie of people you trust,
ask totally totally.

Speaker 2 (24:39):
Well, so then then I'll get to now we'll finally
get to today. So so how did you go? It's
kind of surprising that both you and Melissa are former
state as geez, I mean, has that ever happened before?
How did you decide to do this?

Speaker 3 (24:52):
Recent Republican ferk Nominee is also a state of s
J stance J West Virginia.

Speaker 2 (24:56):
Tell me, tell me talk speak more about this and
what's that about? Why is that the way where they're
finding you? People? Like there's no anterest lawyers in DC,
like what's going on?

Speaker 3 (25:03):
Yeah? So I think the state SG dynamic is interesting
because it's in the like scope of American history. It's
quite recent, Like Virginia only got its first SG state
SG in like nineteen ninety nine, and even that one
was quite it was one of the earliest states together.
It was a totally different job than it is now.
But there is like phenomenon that even judges and former

(25:25):
justices have complained about, which was states were repeat players
in huge cases with big issues in front of the
court and often had like local prosecutors representing them or
townty county attorneys or whatever in these like massive cases
of national importance, and the briefs were often.

Speaker 2 (25:42):
Like the rogue guy, you know the story. Yes, it
was like, I'll never be over ruled by two beautiful ladies.
And what did he say?

Speaker 3 (25:48):
He made some ridiculous he made something that probably would
go great in a Tyler, Texas courthouse and in the
Supreme Court was like dude, nails on a chalkboard.

Speaker 2 (25:56):
It's awful and so beautiful ladies.

Speaker 3 (26:00):
It's insane that like, you know, I don't encourage you
to go back and listen to it, but you can
listen to the recording and you could have heard a
pin drop. He's like doing a Texas like Awschuck's laugh
and you could feel the angst in the room. And
so this phenomenon where states are like losing winnable cases
and they are not getting like the sort of appellate
representation that private parties are getting. At the same time,

(26:22):
the appellate bar is becoming super specialized. States started creating
like appellet specializations and they just copy the federals the
federal government state for that, which is slicter general. And
over time this has developed into like one of the
places that super talented young lawyers can go from like
big law firms, to get a ton of like courtroom

(26:42):
experience while also benefiting either their state in my case,
or states that they adopt, as is the case a
lot of other people and on both sides of the album,
particularly Republicans. These state SGA offices are also the way
that state governments push back on federal bureaucratic overreach. States
sue the federal government all the time. They fight rules,

(27:03):
policy statements, they sue to enjoined legislation, and typically the
part of the government that does that for the states
is the state solicitor in general.

Speaker 2 (27:11):
So you get a.

Speaker 3 (27:11):
Pellet specialists who also become admin law specialists, which means
that they are generally pretty good lawyers but have a
decent political ear and they come from all over the country.
Melissia's from Utah and for Virginia, but like the status
gy of Mississippi who won Dobbs had no connection with Mississippi.
The status dy of Florida who just argued the big
net choice states had no connection with Florida. They're just

(27:32):
super talented lawyers. They were in the Trump high ranking
in the Trump administration, and it was a place to
go where you can keep sort of fighting for what
you believe in and you know, get cool experience and
what made you want to do this. I had not
been in a courtroom when I you mean FTCGC, Sorry,
I know what you want to be. Yeah, yeah, so
that's a that's a good question. I did not at first.

(27:55):
I resisted taking the position partly because the sg's job
is so fun. It's like the most fun litigating job
you can possibly have. It's it's so fun. And I
had like very carefully picked my little like band of
men and women as deputies and assistants, and they're like
the best outside of my clerkship. It's like the best
lawyers I worked with, just phenomenal, And so the job

(28:15):
was fun. We like won cool stuff, we brought cool suits.
I got to argue this stuff that really mattered to
me and then handed off to someone else if it didn't,
and then they got experiences as well. It's just a
crazy thing. And the FTC, I was worried. I didn't
really want to come back to Washington. I had done
any trust law. It had always interested me, like I
had done it. That was my primary thing in private practice,

(28:36):
and I've done an interest policy on the Hill. But
it's like the FTC. It's one of the alphabet soup agencies.

Speaker 2 (28:44):
But at the time, you guys do what the internet
or something?

Speaker 3 (28:49):
Yeah, yeah, exactly, yeah, broadcast, Yeah, that's right, right, and
then the FEC does not something that's right. Three three
is still a decision. But you know, at the time
that I'm considering this, the FTC is becoming like a
household name. It's getting a write up in the Wall

(29:09):
Street Journal every day because anti trust law and views
on anti trust law that had been relatively static. I'm
gonna get some criticians of that, but in some ways
had been static basically since the eighties, or at least
had been agreed upon since the eighties were coming undone
on both sides of the party or both parties. And
that was super interesting. And my time both on the

(29:30):
Hill and working for the SG as the SG working
for an ag had made me more aware of a
the importance of doing real consumer protection work. I just
had never really thought about it until I was SG,
and then I saw how important that is to like
that every American you know, when they're screwed over by
some fraudster, it's the consumer protection part of the government

(29:50):
that comes in and gets the money back for them.
Critically important to the relationship between the governed and the government,
critically important.

Speaker 2 (29:55):
So the FTC is basically just for those who don't know,
it's basically trust, merger review, enforcement, and consumer protection.

Speaker 4 (30:03):
That's right.

Speaker 2 (30:03):
So what is like your day to day as a commissioner?
I mean, are you You're not like litigating the cases? Right,
So when what do you do? Do you have a staff?

Speaker 3 (30:11):
I have staff.

Speaker 2 (30:11):
You just go to lunch all day.

Speaker 3 (30:12):
I go to lunch all day. I came here from
a lunch. Yeah, my office has a beauty.

Speaker 2 (30:18):
People love lunch.

Speaker 3 (30:19):
They do lunch.

Speaker 2 (30:19):
They do have lunch.

Speaker 3 (30:20):
They love brunch too. Yeah, I mean, so it the
FTC has been described by the Court as quasi executive,
quasi legislative, and quasi judicial, and as many constitutional problems
as that description creates, it's accurate in the following sense.
We do three things. We decide cases as judges in
our internal court system, which we've had since nineteen fifteen.

Speaker 2 (30:43):
And they appeal to the Commission.

Speaker 3 (30:44):
They write that it's litigated in front of Alj's. The
Commission sits as the appellate court, and then you get
very defferential review from the DC Circuit. We enforce the
anti trust and consumer protection laws, and we do rulemakings.
We do more rulemakings than I think we probably should.
But that has always been part of the FTC's docket,

(31:05):
is that there's a you know, there's a series of
statutes that authorize and instruct the steacy to make rules,
and so that's that's kind of the sum and substance.

Speaker 2 (31:12):
And so what are the dynamics like among the commissioners
and in particular, I know we're all very angry at
Lena Khan because I read about it a lot, and
I was just curious, like, how does perception match reality?
What's it been like getting there? It was just Democrats
for quite a while, right, more than a year, I think, Yeah,
So you know they were so are you guys all
screaming at each other? Not at all?

Speaker 3 (31:33):
I mean, so You've heard this all the time too,
because you clerk, for one, but the justices are fond
of saying like, we get along great. My experience was
that interpersonally among them, that's actually generally true. That's also
true of us. We talk to each other basically at
least once a week. All of us have like scheduled
phone calls with the other where we sort of catch up,
you know, talk about personal lives, talk about things happening

(31:54):
in the commission that matter to us, talk about the
sense we might have just written where someone wants to
like talk about it a little little bit more, because generally,
if you write a dissent, it's on an issue, it's
probably going to come back in some way, and there's
always you know, we're trying to.

Speaker 2 (32:06):
Convince the most important the next vote.

Speaker 3 (32:08):
McConnell's right, exactly, that's exactly right. So personally, you know,
get along well. Our stabs seem to get along really well.
Everyone was super welcoming of me when I got there,
and I know that for a certain part of the
of the economy. Lena Kahan that the cheric is kind
of like a boogeyman. She's I get along with her

(32:29):
great she you know, got dinner. If she's really really nice,
you know, she has very firm beliefs on stuff. I
actually makes me like her more. If there's one criticism
of Washington that I think a lot of us who
are true believers in whatever we believe and have, it's
the number of sort of like unapologetic mercenaries. We don't
really believe anything except trying to maximize the system for

(32:52):
their own benefit. Chair con believes what she says. This
is not a ruse. This is not with the ambition
of getting a fancy gcge or big wild job. At
the end, she bleedves this stuff.

Speaker 2 (33:04):
Yeah, well, yeah, I don't know that her relationship with
corporate the way she has acted does not suggest she
is playing for the general council job at Facebook or whatever,
which is which I agree with you. I mean, there's
a lot of people in this town that are just
total acts. And so it's good. It's good here, all right.
So let's let's do a little substance then, because I
don't want to keep you here all day. So just

(33:25):
like at a basic level, so I went to the
Emergy of Chicago. I took anti trust from Richard Epstein.
You know Robert Bork, we have like a bust of
him in my house. We don't, actually I have a
bust in my house, but we might. We might have.
But at the same time, you know, Justice Holmes said,
and I totally agree with this, the life of the
law has not been logic, It's been experienced. And it's
now been many decades since the anti trust paradox came out.

(33:47):
A lot has changed, the economy has changed, and I
gotta feure what the rest of this question is. Oh,
it's easy in your view. Where is anti trust law
kind of today? Generally? Where is it going? I mean,
is is it enough still to just read Robert Borke's
book and you'll have all the answers, or what do
we think?

Speaker 3 (34:05):
So this is part of why I wanted to become
a or why I told yes, said yes to Leader
McConnell's offer to recommend me to the White House. I
want to explain why this like debate is so interesting
and where I think it's going. I want to go
back real quick. So any trust law before Judge Bork
writes this book is like a little bit like internally incoherent.

(34:28):
I think there are a lot of reasons for that.
One of them was that the statutes are not paragons
of of clarity. And then part of that I think
had to do with sort of how the judiciary up
into the seventies was understanding its role. And then Judge
Bork writes this like massive book. It's probably the single
most influential monograph in American legal history, because he basically

(34:48):
rewrote an entire area of the law by himself in
one book. It's like a true it's a you know,
you know, like will to power, like it's it's unbelievable
the sort of thing that he did. And so we
go from a sort of multivariate version of anti trust.
Reports are considering all sorts of things and deciding whether
the anti trust laws have been violated by particular you know,

(35:09):
like agreement or or merger to what we today call
and I'm hesitant to use this term because it means
a lot of things to different people, but the consumer
welfare standard, and that generally stated it elevates price and
output is the principal considerations of anti trust. If A
if a you know, an agreement between two competitors or

(35:29):
merger between competitors or even non competitors is unlikely to
lead to increases in prices or decreases an output than
under the I'm generalizing here big time, and for anyone
listening to this, I recognize it's more complicated than I'm
making it. I'm just trying to make a point. You
can leave your comments in the body Yeah exactly right, yeah, yeah,
well like and subscribe.

Speaker 2 (35:51):
I promise will read them all.

Speaker 3 (35:56):
But you know, even combinations among compact editors. The judge
Borg's view of this would say, if it doesn't affect
consumer welfare by increasing their prices or decreasing output, they
shouldn't be of particular concern to the anti trust laws.
They might be concerns under other legal regimes, but the
anti trust laws probably shouldn't have anything to say about them.
This revolutionize how courts see anti trust laws, I think

(36:19):
for a couple of reasons. One, by the nineteen seventies,
the country was searching for a way to cabin judicial restraint.
Judges were sort of just like ruling the country with
like you know, bussing orders and stuff. They in some
places they were literally running entire cities, and the country
was searching for something that would constrain judicial discretion. The
sort of economic first version of anti trust offers an

(36:44):
objective sounding restraint, which is, we will apply basically economic
science to these anti trust questions and we can get
objective answers both that will constrain enforcers and allow us
to measure whether judges got it right when they either
blocked a merger or forbade a particular combination. One of
the like interesting things about this is both parties ended

(37:06):
up agreeing on this. Like, you know, for all the
lamenting of the absence of bipartisanship in Washington, there was
bipartisan consensus on anti trust basically from the nineteen eighties onward,
which is, we consider price and output effects primarily. We
consider other things too, like innovation, consumer choice, quality, but
things that have some sort of relation to price and output.

(37:29):
And that's sort of our like load star in anti trust,
and it has the benefit of seeming sort of like
internally coherent. Fast forward to just a couple of years ago,
beginning of the twenty tens, there's this group on the
left that we now call the like neo Brandisians, and
they take the view that this version of anti trust

(37:51):
doesn't sufficiently account for other concerns the anti trust laws
should addressed, like the political and social effects of large
combinations of power in the private sector, effects on labor
are things that the post anti trust paradox version of
anti trust didn't really take directly into account. And they
start agitating for sort of like sort of like a

(38:12):
return to preborg anti trust. It's it's actually they have
a more complicated version of anti trust in that. But
they called that they're called and then callingsose Neo Brandeisians
because then before became a justice, brand Eyes was advisor
to Woodrow Wilson on anti trust and had a very
particular way of viewing anti trust. And so they start
agitating on the left. But the consensus is on the

(38:34):
left and the right is really strong, and they don't.
They make a lot of headway in the journals and
in certain corners of the Internet, but are not making
a ton of headway kind of in the ruling clique
of the Democratic Party.

Speaker 2 (38:47):
A lot of Obama people who were looking for general
council positions at big companies on the backside.

Speaker 3 (38:52):
You got and they're all there now, and yes they are,
they are, yes, overseeing their large combinations almost coincidentally on
the right, views on anti trust begin to change because
of the sort of surge of populism.

Speaker 4 (39:09):
That almost accidentally is probably an unders under Unrelatedly, I'll
say it wasn't well thought out. The like neo Brandisians
have a like real political economy objection to anti trust.
The populists sort of, but it's almost more cultural and

(39:29):
look like I'm you know, Scott's Irish family. It's been
here for centuries. I don't like anyone big telling me
what to do. I don't like big Wall Street telling
me what to do. I don't like k Street telling
me what to do. I don't like Pennsylvania Avenue telling
me what to do. And that sort of like sort
of populous fervor is fulminating within the Republican Party and
President Trump I don't think he was responsible for it,

(39:50):
but he was one of the first to like realize
what this was, and that is leading to some people
to change views on anti trust. And the example I
give is I can remember biking into Washington. I lived
in Old Town during my clerkshi and I would often
like in listening to the news on the way into
clerical morning, and President Trump was like giving speeches about
anti trust policy and promoting enforcement and like, as a Republican,

(40:12):
I was like, what's happening, Like he's calling for anti
trust suits against like Amazon, like these big, hyper efficient businesses.

Speaker 3 (40:19):
What's going on? And I think it was a recognition
that there were a lot of people in the economy
and in America who didn't have like sophisticated thoughts about
anti trust law, but understood a lot of these businesses
seemed to wield an incredible amount of power and I
don't know exactly why it is, but it seems like
a problem. And my sort of encounter with this was

(40:41):
twenty twenty after the George Floyd riots, where businesses were
taking very aggressive public positions on policy questions about qualified immunity,
prison sentences, police policy had nothing to do with their.

Speaker 2 (40:55):
Businesses, and they were colluding to do it.

Speaker 3 (40:57):
And they were taking the All Star Game out of Atlanta,
they were boycotting states because of their election laws. And
I remember going, what's happening? Why do they care about
this stuff? I thought that they were supposed to make profits,
make widgets profitably and efficiently to benefit the common good.
Why am I having general counsels call me while I'm

(41:17):
working for leader McConnell advocating for a position on qualified
to me, what is happening here? And I think what
I was sensing was what other people had sort of
been intuiting, which is, private aggregations of power that have
a lot of economic power can wield that economic power
to accomplish social, political, and cultural ends. And that seems

(41:41):
kind of scary. And I will admit like, by twenty twenty,
I was like, this is kind of scary, actually. You know,
the sort of orthodoxy on our side for a long
time had been the big government is bad, and that
is still true. I think we also agree on that
big government is bad, it's dangerous, it's inimicable to the
republic can experiment. You know, human liberty is necessary to

(42:04):
help achieve human flourishing, and big government gets in the
way of that. We all agree. The other of you
had been we don't need to worry about big aggregations
of private power because that's just humans wielding their liberty
and the fact that they're doing it in combination with
each other shouldn't really concern us. And I think that,
you know, i'd started to become concerned on the hill
dealing with these big businesses and kind of how nakedly

(42:25):
they lobbied for regulations that would insulate themselves from competition.
But by twenty twenty, I was like, I get the
danger to human flourishing and to individual liberty that big
aggregations of private power can pose. It's not the same
as the government. I'm not equating them. It's not as
coercive as the government by any means, but it also
isn't always good or morally neutral.

Speaker 2 (42:47):
So actually, I'm going to do these a little bit
out of order. So because that made me think of something.
So I don't know if you're familiar. There's a professor
named Daniel Crane at Michigan who wrote an Article's written
a lot of stuff, but you wrote an article called fascism,
fascism and monopoly. And in that article, and I want
to quote it so I don't misquote him. This is
from his abstract. He reviews the historical materials and he

(43:07):
argues that quote, the extreme concentration of market power during
the y Maar period enabled Hitler to seize in control
to talitarian power through a variety of mechanisms. And what
made me think of that was you were talking about
government power and KIH concentration. Either there's the Murphy case
or I forget what it's called now, but the case
about the government bullying the social media companies into suppressing

(43:28):
various few points about COVID, which I found to be
unbelievably scandalous, especially when the schools shut down. And I mean,
I have little kids and all of that. What do
you think, I mean, does this scholarship tell us anything?
Is there something we can learn from that as we
try to think through the antitrust problems of today or
what are your views?

Speaker 3 (43:44):
Yeah, so I haven't. I've read a lot of Professor
Crane stuff.

Speaker 2 (43:48):
He also has.

Speaker 3 (43:49):
He wrote an interesting blog post about the noncompete rule
that the Commission just addressed.

Speaker 2 (43:54):
Interesting.

Speaker 3 (43:55):
Yeah, he's a talented guy. So without addressing that argument,
specif you know, I said this in my confirmation hearing
when I was talking about the Merty case, and I
think it's true, which is, there's a long history, not
just the United States but in the United States of
government working with large businesses to accomplish shared objectives, even

(44:20):
if those shared objectives are not consistent with human flourishing
and human liberty. In individual liberty and the concern that
I have is if you have a market that has
a very small number of hyper efficient suppliers, it is
easier for the government to control you and me, the

(44:42):
individual downstream in that market if they only have to
course a couple suppliers to then control our behavior. And
you know, Virginia was in a meekus in in the
merty case, and so you know, I've participated in this litigation,
and I don't you know, they'll have to they would,
the States would have to p their case if the
Supreme Court lets the case continue forward. But the sort

(45:04):
of thing the concern that Murthy raises, which is the
government either coercing by threatening to take you know, threatening
to retaliate against the business if it doesn't do something,
or cooperating colluding with a business because they conclude it's
in their mutual interest given their large size, to control
the conduct of the individual. Even though that is like

(45:26):
you know, private power in a meaningful way, it's still
as inconsistent with human flourishing and with the individual liberty
we need to achieve the human flourishing if we're just
being directed by the government through their lackeys in a market.
And I think that that is a decent argument that
one can make in favor of an anti consolidation principle
as necessary to like republican virtue.

Speaker 2 (45:49):
Yeah, I mean it would seem to me. I mean,
covid is just to me the best example because a
very small number of companies, and that was before Elon
had bought Twitter. And I don't think the country should
have to depict not a crazy guy from South Africa
buying one of the social media As much as I
love the guy, eccentric, ecentric, eccentric whatever, you know, I
kind of classic. Anyhow, Yeah, they were able to edgy, yes,

(46:13):
be able to able to basically suppress the whole debate.
I mean, and that had incredibly terrible exact I mean,
kids were locked up, we had to sue Laden County
about maskets, you know, after young Kin had won the election.
It was crazy how how much distortive power they had
over the democracy. So I guess maybe I'm just violently agreeing.
I think, is that something the antitrust laws maybe would

(46:35):
have something to say about, or we're not sure we
need to you know, what do you think?

Speaker 3 (46:38):
So I think I think the answer is maybe. And
but I think I think that the principal look, you
and I are lawyers first, and the sort of are
sort of like theory about how one does laws originalism,
which is when law is written, you look at written
text and you try to, you know, adduce its meaning.

(46:59):
And the way we do this meaning is the meaning
is whatever meaning it was understood to have when it
was adopted. Otherwise it's just like advice to judges and
enforcers about what to do in the future, but we
reduce it to a particular meaning. And I think for
the Sherman Act, the Clayton Act and the other sort
of like you know, older but capacious laws that the

(47:22):
anti trust enforces enforce. The question I don't think that
should be governing any particular decision is what would a
coherent antitrust policy look like? That's Congress's call. It's what
do these laws mean and what do they have to
say about the question in front of us? And I
think you know, the subtitle of Judge Borock's book was

(47:44):
a policy at odds with itself. But I think you know,
it's within Congress's kin to adopt a series of laws
that might create some incoherence in their policy. I don't
think it generally should be up to the enforcers and
the judges to lend coherence where Congress has, you know,
competing values that it has at stake. Does that mean

(48:07):
that Judge Bork got the anti trust's laws incorrect? Not necessarily,
But what I think it means is the argument I
hear in favor of the consumer welfare standard most often
is not. This is what the Sherman Act was originally
understood to mean. It was we need an objective standard
to measure our anti trust policy, and this gives us it.
And my response is if I were coming up sort

(48:27):
of afresh with an anti trust policy, I would want
it to be objective. For lawyers, we have an intense
rationalizing interest. We like internal coherence, and we're very uncomfortable
with things that don't operate soy. Logistically, that is not
how laws are written. It's never been how laws are written.
Laws are written to address particular problems at particular times,
and they lay down principles to address those problems. But

(48:47):
those principles, especially when you have multiple laws passed at
different times addressing similar subject matter but done by different
Congresses to address different situations, are not always going to
be internally coherent, And I don't think it's consistent with
our constitutional structure for judges and enforcers to say, look,
the original meaning might lend itself to some internal coherence.

(49:09):
Will we will create the coherence ourselves. And so I
think that the first question judges and enforcers should ask
in anti trust cases is the same one that they
ask in every other case, and that you and I
sort of regur would ask in a due process case.
Always always, but you know, like this is commonplace when
you and I talk about almost any other area of
the law, right is like, well, what did this thing

(49:30):
we're arguing about? What was it understood to mean? With
the equal protection clause, the due process clause, privileges or
immunities clause? Like that's that's the debate we have a
lot of time. That is not generally the debate we
have when we talk about the anti trust laws. We
generally say, what do the economists have to say about that?
If if relying on economics basically alone to answer anti

(49:51):
trust cases is what Congress was laying down, we should
keep doing it. But I think that for every judge
and every enforcer, the first question has to be, what
did this law being asked to interpret, mean, what is
the principle it lay down and how does that apply
to this particular case. And even if there's some internal
incoherence in the law, like for example, the Sherman Act
as we currently understand it and the Robinson Patman Act,

(50:12):
which are difficult to wreck, their policies are difficult to reconcile,
I don't think that it's up to the other two
branches of government to sort of lend it coherence. If
the incoherence is a problem, Congress needs to address it,
because that's how we govern ourselves as through Congress.

Speaker 2 (50:27):
Okay, that's interesting. I want to ask you about another situation,
another modern economic development that I personally find very interesting,
and you say as much as little as you can
so that and that's institutional asset managers. So you know,
I'm not an expert on this history, but my my
sort of general sense is that over the last couple decades,

(50:50):
the rise in sort of Americans who own stock has
he's gone up, has gone up a lot, and most
people don't want it. They don't know, they're not going
to pick stock, like they're not short apple or what.
And so as a result, they used to have stockbrokers
investment managers, but now all that money has gotten pushed
into the hands of a very small number of institutional
investors black Rock, State Street, Bandguard. I think it's like

(51:10):
four and some the numbers kind of bounce around, but
some of the stuff I've seen says they generally control
about eighty percent of the shares that are in the
S and P five hundred. So these four or five
companies control eighty percent of the public capital. That means
that as a practical matter, they are the common owner
of every major public company in America, including competitors. So

(51:33):
this is my longest question. So academics like Eric Posner,
who actually came to work for Jonathan Canter at the
Antitrust Division, and Fiona Scott Morton have written that, you know, basically,
this is something we should be very, very worried about because,
I mean, and you can see why. Right. So, if
the same two or three asset managers own fifteen percent
a piece of United American Airlines, Delta and Southwest, that

(51:58):
means they want the overall that value of the companies
to be as high as possible, and they'll give them
a direct economic incentive to not want one company, as
the free market theory would say, they would want to do,
cut its prices, kill the rest, increase its market share,
and emerge maybe fifty percent more valuable. But the other
three are dead right, that is not in the interest
of the common owner. The common owner wants them all

(52:20):
is eighty percent. So that's a very long question. I'm
just curious if you've thought about this at all. Obviously
I'm asking to appine on any particular case or whatever,
but just what do you think about these new and
private equity has similar dynamics where they'll own competitors in
a particular city. Is this something you've thought much about.

Speaker 3 (52:36):
Yeah, let me start off before I answer this. You know,
like I said at the beginning, I'm here in my
individual capacity. I'm not representing the Commission, of course, and
so the views I'm expressing are not about the Commission
and not about any particular matter. So let's set aside
before I answer this. The like specific asset managers you identified,
I'm not going to talk about them specifically at all,
but I do think the principle or the concept you

(52:59):
identify were important, and I remember reading in our el
Hog's article in twenty sixteen, because I, like most Americans,
put most of the money I invest in, you know,
indexed funds that are by this exactly, They're run by
these asset managers. It's a safe place for someone who
is not going to play the market. I'm not going
to It's very rational. It's a safe place to put it.

(53:21):
And I remember reading this article going, I'd never thought
about this like common ownership or cross ownership problem before
at all, much less as an anti trust problem. But
el Hog had just talked about this twenty sixteen, and
then you're right. You know, Scott, Morton and Posner have
like written sort of on top of l Hog's work
like this is this is a real problem. The Commission

(53:41):
actually addressed this recently on a thing I voted for for.
The Federal Energy Regulatory Commission is considering changes to its
rules by which it grants waivers for firms to like
asset manager firms to own stock or own entirely utility
companies which are subject to FIRKS regulation. And they are

(54:01):
allowed to give waivers to let these asset managers own
utility companies even though they own other companies, including other
utility companies and the FTC unanimously with DOJ wrote a
comment letter in this ongoing rulemaking where we highlighted the
risk of common and cross ownership. And this is in

(54:22):
the twenty twenty three merger guidelines. You know, there are
parts of the guidelines that I'm not sure I agree with,
but this one I think is important. It makes important points.
There are like obvious potential antitrust problems with this common
ownership problem. The first is, you know, if you've got
one business that owns non controlling stakes in multiple companies,

(54:48):
it's having access, for example, to like competitive information multiple
competitors that itself is sort of like facially a problem.
The second is, even if, and it's what you identified,
even if you don't own to controlling stake at any
one of these companies, you might own enough for board
seats or for other ways to like dictate outcomes to

(55:10):
the company, to dictate business decisions. And that is a
nasty incentive not to compete on certain things, or to
diminish the incentive to compete. And if the theory of
the antitrust laws and of American competition policy is that
basically maximum competition is good, disincentives to sort of compete
in order to benefit the common owner are are very risky.

(55:34):
And so this letter pointed this out, like, Hey, even
in cases where the acquisition of one of these utilities
isn't you know, controlling stake, it can still create competitive
problems because of the risk of like information share or
access to competitive information, the disincentive to compete. And you know,
that problem seems like it may be compounded if you know,

(55:57):
you have a small number of non control rolling shareholders
in each company and the identity of those shareholders is
all the same, So you know, one company owning fifteen
percent of stock and one company and in a competitor,
you know, we would say, hey, this might trigger some
anti trust concern but standing alone, you know, maybe not,
it might not be super dangerous. But if there are

(56:19):
you know, five of those and all the same companies,
you know, then you've got it. Seems like it compounds
the potential anti trust problem that might exist from common
ownership generally. So yes, I mean I've not done as
much thinking as like Fiona or Posner, but yes, like
the Anti Trust Merger Guidelines addressed this as a problem,

(56:40):
the FTC has just said, like we should all be
wary of the competitive problems that this sort of cross
and common ownership can create. And I do think it's
a problem. It's an issue, not necessarily a problem, but
it is an issue that the enforcers are going to
have to confront because this sort of cross ownership, common
ownership consolidation is growing, not.

Speaker 2 (56:59):
To for sure. And so then I guess I have
a related question. This isn't specific to the asset managers,
but over the especially after George Floyd, there were a
lot of different alliances to achieve very usually within the
umbrella of ESGS, so the Climate Alliance to reduce carbon,
the racial justice alliance. You see the law firms, they'll
all join something to pledge to hire more black lawyers.

(57:22):
I was very surprised when I was in the private sector,
because I hadn't been in for five or six years,
by how monolithic the big companies are on particularly racialized
hiring of vendors and staff. It's really weird and it's
quite overt. Maybe it's gotten a little better after SFFA.
I don't know. And I'm just curious if you think
these kinds of things are the sorts of things that

(57:45):
can present an antitrust problem. And they're not colluding to
raise prices, but they are colluding to, you know whatever,
produce less carbon higher people of this race and not
that race, you know whatever. Yeah, just in general, not
very specific.

Speaker 3 (57:58):
Yeah, I mean, look, and Chair con has even addressed
this and either in a speech or paper I can't
remember which she said, ESG is not a valid justification
to collude. And you know, like some of these ESG agreements,
I'm not going to say they're anti competitive, but i
am going to say that they were agreements between competitors
about what to do that maybe.

Speaker 2 (58:18):
At least could be in the markets. That's details and facts.

Speaker 3 (58:21):
That's right, that's right, and often look like an agreement
not to do certain things. And when horizontal you know,
when when firms in a horizontal relationship or competitors agree
to do things or not to do things, generally, our
anti trust laws say we should think about this very carefully.
And you know the fact that the thing that they
might be agreeing on is favored politically by one side

(58:47):
or the other is basically irrelevant to the anti trust
question about whether it's good for competitors to agree on
this type of thing. On the hiring thing, you know,
it doesn't come up very much, but labor's a market,
and the anti trust laws applied to combinations and conspiracies
in in any in any line of commerce. Same with
the same with the Klayton Act. So you know, this

(59:10):
is a sort of like roaring debate that we're having
within anti trust right now and within the mean the Commission.

Speaker 2 (59:17):
Labor market restraints. Right, they've even brought criminal cases, that's.

Speaker 3 (59:20):
Right, and a few of them, that's right, and that
actually goes I mean, the the anti poaching stuff like
in Silicon Valley, that goes back to before the Biden
administration where they would have been a criminal case today
jobs exactly, exactly, yeah, yeah. But the point being, even
within the sort of bipartisan anti trust consensus, which has

(59:40):
frayed over the last five years, there was agreement that
labor is a market and that if you fix output
in that market or prices or whatever, or you allocate markets,
which is what the no poaching agreements do, it creates
anti trust problems. And you know, I think that the
debate about we're hav right now within anti trust and

(01:00:02):
you know, like Commissioner Badoya, my colleague on the FTC,
has written and given speeches a lot about how you know,
labor concerns, including like labor union like organizing concerns, are
anti trust concerns. You know, I don't know how I
feel about that, but it's true that labor markets are markets.
And if there are anti competitive agreements among purchasers of labor,

(01:00:25):
whether those agreements have to do with like everyone agreeing
on which races are going to be hired or why,
or the conditions those aren't have never been understood to
be and aren't outside of like the interests of or
the interests that the interest laws are supposed to protect. So,
you know, without addressing any of the like specific things,
agreements among competitors about who to hire who not to

(01:00:48):
hire have always been understood to at least present problems.
The anti trust lawns are consimply with.

Speaker 2 (01:00:53):
Yeah. Yeah, So so my last question, You've worked in
the Senate, you've worked in state government, you're now a
Republican commissioner on the FTC. You know, Look, there's all
this talk about a realignment about where the Republicans are
going to all be like Josh Holly marching with the
union workers the Democrats. I think the Democrats already here
they're the neoliberals, you know, hanging out with Sundar Pinci
and the Google people and like going to Burning Man,

(01:01:14):
like Neil kachiall and all this other, you know, fancy stuff,
while we're hanging out with the working class, which I
think would mean that an anti trust you could at
least imagine a bit of a role reversal where Chair
Cohn and Jonathan Canter is very forward leaning perspective is
increasingly shared, if not adopted by by our sort of
our party. How real do you think this is? And

(01:01:35):
if you had to sort of play things out for
the next ten years, what would you So?

Speaker 3 (01:01:40):
I think that the realignment on the left is pretty real,
I don't know, sort of.

Speaker 2 (01:01:47):
Meaning they're now the blutocrats.

Speaker 3 (01:01:49):
Well, but also I think look like, in my words,
not years but five years ago, the chairs position, you know,
the Senator Warren position on anti trust. They were plucky
upstarts that no one and their party took tremendously seriously.
They're now in charge and that basically happened overnight. And
I mean share Con is younger than I am, and

(01:02:10):
she was the Larva article that sort of like put
her on the National Stage is like seven years.

Speaker 2 (01:02:16):
Old, had a great title, It's good marketing, marketing.

Speaker 3 (01:02:19):
Yeah, no, she got it. It's Amazon's anti trust paradox. Right.

Speaker 2 (01:02:24):
I think it's called the Amazon paradox.

Speaker 3 (01:02:25):
Yeah, it's good. Yeah, she got it. Yeah seriously, so uh,
I also agree with you that I think what has
been called and I think with some actually the sort
of professional managerial elite are now the like core of
that side of the aisle, which makes the left very
interesting right now because CON's version of anti trust is

(01:02:47):
not consistent with their interests. The way I've described the
anti trust debate on the right on our side of
the aisle is it's a it's a jump ball, and
that the fraying of the consensus that like work in
consensus means that on our side people are like grappling
with this for the first time in a long time
about whether do we continue with this sort of price

(01:03:07):
and output dominant version of anti trust. Should it account
for other things? And I think whether which side of
the court that jump all lands depends on a lot
of things. One I think this election will partially determine
that if President Trump wins, he's going to need to
pick an FTC chair and an ag for the Intrust Division,
that they wield a tremendous amount of power over where

(01:03:30):
a party is on anti trust because it's a you know,
antrust is primarily government driven thing, so that will determine
a lot of it. But the second, and it's sort
of the wild card in this is the judiciary because
everything that the enforcers do is checked by the judiciary.
You know, when mergers are blocked, there's a trial, a
PI trial or a full trial in front of a judge.

(01:03:51):
When rulemakings are adopted, a judge will decide whether they're lawful.
You know, conduct cases, criminal cases like you're or wife
handles a DJ those are all in front of the judiciary.
No matter where the sort of executive branch is going
on either side, or how quickly, it will only go

(01:04:12):
as quickly to the extent as the slowest moving, most
conservative and I mean small ce in terms of disposition,
not politics, branch of the government is which is the judiciary.
And I think this has been talked about a little,
but I think both sides sort of overstate either it's
insignificance or its significance. I think that the folks who

(01:04:33):
want to recover the original consensus say don't worry, the
judiciary is going to take care of this. The folks
on the other side say, don't worry, the judiciary will
go where we want them. I'm not sure either is correct,
and I think on the right, I think that this
answer is going to be written by academics and judges
who dig into the original meaning of the Sherman and
Clayton ax and try to figure out did Judge Bork

(01:04:54):
get this correct? As we now do originalism, I mean,
like it or hate it. A lot of the work
that you and I did on judges and the Trump
administration was we put people who take originalism incredibly seriously
are in many ways outcome blind. Like we have our
interpretive theory, it must be followed to its conclusion, and
we got a lot of scholars who think that way too,

(01:05:16):
largely because we created like a judicial market for it
for the scholarship. I think that there are folks, you know,
on the right who are beginning to sort of dig
back into the original meeting of the Sherman and Clayton
aax and to see whether they're consistent with what we
today call the consumer welfare standard and If they aren't,
I think judges are going to be more open to

(01:05:37):
embracing other theories of antitrust more quickly than sort of
the defenders of the consensus are. But similarly, if this
sort of research which is beginning reveals that the consensus
basically got it right, I think that sort of the
revolution that we've seen on the left and the debate
we're having on the right is not going to move
the way they think it is, and it's going to be,

(01:05:58):
in many ways sort of stayed and retained within the consensus.
If judges think that that is in fact the correct
reading of the law.

Speaker 2 (01:06:04):
Yeah, but I mean so, I guess that wasn't my
last question, But I mean, so, look, the law is
sort of a it's sort of a pendulum, and so
even it seems to me that there's a plausible case
for a more modest aspiration, which is to say, look,
Bork was really great, but now we're too far. We've
gone too far in that direction, and even on his
own terms, we're not dealing with things that are that

(01:06:25):
are like pretty serious problems. So like like I don't
know the details of the Apple case, and you should
not ask you about the Apple because that is the
FTC right or is that dj dj okay? So maybe
I guess it wouldn't come before you. But but like
it seems, it just seems to me that that there
may be just having more people engaged in thinking creatively
as plaintiffs using the tools that exist right now. Like

(01:06:46):
Alston is a good example. So I was at the
court for Alston, the NCAA case that that Seth Waxman,
who's a very good lawyer at Wilmer, petitioned. He asked
the Supreme Court to hear the case and then lost
nine to Oh you know that it's not normally the
way you want.

Speaker 3 (01:07:01):
It to go. Uh.

Speaker 2 (01:07:02):
And I thought that was interesting because it showed that, like,
people are not thinking that hard these days. And I
do wonder if there's a lot of progress we could
make sort of sort of deconsolidation by just being more
thoughtful about applying the current law the way it's currently
understood against new economic arrangements that are okay.

Speaker 3 (01:07:22):
Yeah, So I totally agree with that, And that's a
good caveats not the right word, it's a good corollary
in my original answer, which is, you know, there are
cases that you could probably one could probably win even
under the consensus view of anti trust that just aren't
brought because of sort of like political views about the

(01:07:42):
political economy by the enforcers that I think has shifted,
and that shift doesn't rely on the judiciary, And I
don't think that they are not that they are unwilling
to sort of accept more aggressive anti trust. I think
Alston's a great example. Like I I have a hard
time reading Judge Kavanaugh's concurrence in all and think like,
this is not a court that is not willing to

(01:08:03):
find a favor of Avantagel. The union of the majority
opinion was that it was phenomenal, it was very good,
it was and it was absolutely correct. But the example
for yeah, and in a way that I think if
you get back to the nineties, you would be surprised
to find a Republican judge like him saying this type
of thing about anti trust cases. Another example is Google

(01:08:24):
United States in Virginia against Google the theory so that
this is a case in Virginia signed the complaint. I
did represented seventeen states alongside the United States and argued
the transfer motion that kept it in the Eastern District
of Virginia. We aren't proposing.

Speaker 2 (01:08:38):
They're trying to go to San Francisco.

Speaker 3 (01:08:39):
They're trying to go to edian Y where the NDL was,
so that we would hear about the case in a decade. Yeah, uh,
you know, thank you, thank you. We we We weren't
proposing a novel theory. It was a like relatively run
of the mind consolidation theory premise largely on like tying
in a series of acquisitions that had entrenched a monopoly
unlawfully and that needed to be unwound. But it wasn't like,

(01:09:02):
this wasn't an envelope pushing section two theory in the
theory in the sense that we were like, you need
to we need to move you beyond Bork to get this.
We were like, just take the consensus. This is illegal.
The difference is, I think that the worries about consolidation
on both sides of the aisle lead enforcers, even if
they share the consensus view, to be more willing to

(01:09:24):
pull the trigger in cases they would have looked at
before and exercise sort of a prudential judgment against bringing
not because they thought it was inconsistent the initial saws,
but before sort of like broader political economy concerns that
I think that's probably here to stay. I mean, eternal
general Rires is very conservative. And there were other Republican
states joining Merrick Garland and the Justice Department suing Google

(01:09:47):
on a monopolization claim that would require them to sell
off parts of their business. This doesn't sound like ninety
style Republican antitrust policy, but I agree with you. There's
a lot that can be done to protect Americans from
contolidation with existing theories of antitrust that don't require revolution.
And I agree with you, and I think Alson is

(01:10:08):
like the perfect example. It's not like judges are going
to be like, no, we have policy concerns with aggressive
anti trust enforcement, and so we are going to like
police the consensus and keep stuff that comes close to
the edge from getting in. I think that they're willing
to do it. But I think they're willing to do
it not because of the consolidation concerns that so many
Americans have, but more because they're like, we're just reading
the law and this is not inconsistent with the law.

(01:10:29):
The fact that enforcers were exercising their judgment not to
bring the cases basically for like non legal or soft
legal reasons. You're right. I think there's a lot can
be done and the judiciary is not going to be unreceptive.

Speaker 2 (01:10:40):
That's great. I will thank you.

Speaker 1 (01:10:44):
Thank you for listening to Open Minds, a Freedom of
Thought podcast series interviewing the people who bring courage and
independent thought to the challenges of today. To learn more,
visit freedom of Thought dot fedsock dot org.

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