Power & antitrust

AT&T’s proposed $85 billion purchase of Time Warner is raising eyebrows – and fundamental questions about the purposes of antitrust law, writes James Stewart in the Times:

Politicians were piling on this week to criticize the deal, including Donald J. Trump; Tim Kaine, the Democratic nominee for vice president; and Senators Bernie Sanders of Vermont and Al Franken of Minnesota….

A younger generation of antitrust scholars who are rethinking the nation’s fundamental approach to antitrust law may prove even more influential.

“Over the last 40 to 50 years, antitrust law has evolved to be almost completely indifferent to vertical mergers,” said Tim Wu, an antitrust and internet expert at Columbia Law School who coined the phrase “net neutrality” …

In vertical mergers, a company buys a supplier; in horizontal mergers, direct competitors combine.

But the new generation harks back to the original trustbusters of the early 20th century, who were most concerned about preventing corporations from gaining too much power.

“The antitrust system as it stands is focused on prices to consumers, innovation and efficiencies,” Mr. Wu said. “That reflects the triumph of the University of Chicago school of economics. But there’s an older tradition, embodied by Supreme Court Justice Louis Brandeis, that says a concentration of too much power in too few hands is bad for democracy and bad for consumers.”

Read more here. For more on corporate pursuit of power, see this piece by Econ4’s James Boyce.