FTC/DOJ Tensions Stir Sen. Lee to Lament 'Dysfunction' That Also Concerns Experts

The hearing "illustrated the dysfunction that comes with having two federal agencies responsible for civil antitrust enforcement," Chairman Mike Lee, R-Utah, said Wednesday: “We need robust investigations and enforcement of the antitrust laws, especially in the tech arena. That objective is likely to be hindered if the agencies are stumbling over each other trying to investigate the same companies for the same conduct. ... I wouldn’t recommend that they get any additional resources until they demonstrate their willingness to put the interests of consumers above their bureaucratic gamesmanship.” The FTC declined to comment; DOJ didn't reply to queries.

One past GOP FTC chairman, who agrees there's much tension between antitrust enforcers, thinks such agencies' staff should be paid more if stakeholders want better outcomes. "Our national hypocrisy is we want our car to perform like a Mercedes" but we pay for it "like a Chevrolet," said William Kovacic, now a George Washington University law professor, in an interview. "If we talk about how important a more robust enforcement program is," he asked, then "why not pay for it?" It's "a measure of your sincerity," he added, speaking before Lee's latest remarks. "Any public official that screams at the agencies to do much, much more and to do it much, much better deserves this question." Kovacic suggested paying at least initially in their careers antitrust-agency lawyers, economists and tech experts private sector-equivalent salaries, on a Technology Policy Institute podcast released Tuesday.

Podcast co-moderator and TPI Senior Fellow Thomas Lenard agreed to us Wednesday that salary bumps "would help attract and retain good people." But it mightn't "do much to affect relations between the agencies (assuming both of them go the same salary scales)," Lenard emailed us. "Even with the current salaries, the agencies are able to attract top people for trial and expert witness work." He cited people including DOJ expert Carl Shapiro for the department's unsuccessful challenge of AT&T buying Time Warner.

Regardless of financial strictures, "it’s a bad relationship" between DOJ and FTC, Kovacic told us. Additionally, "the relationship between the states and the federal agencies" has "natural tension," he told TPI. And "between the states and the federal agencies, it's dependent a lot on the leadership." The FTC "has had better relationships over time. Right now, the relationship between the states and the Department of Justice is a very sour one. You have ... peaceful coexistence with the FTC." The National Association of Attorneys General declined to comment.

Ideally, "you would want a willing collaboration among the states" and federal counterparts, Kovacic told us. "You'd want to be coordinating a common strategy. These are complicated and difficult industries to understand," he said of tech: Better to "share the knowledge you accumulate rather than operate in a silo." Currently between the FTC and DOJ, "it’s a bad relationship," the ex-FTC chair noted. "Getting called out in public like this by important legislators can be an important stimulus for the agency officials to cooperate in coming up with a better solution," he said about Tuesday's hearing. "This could be a nudge" that could result in better relations, he said.

Fraught relations "unfortunately seems to be the case," Lenard told us. "Exactly what’s going on between the two agencies, in particular, how the tech antitrust investigations are being divided up and areas of overlap, is murky to outsiders." In the podcast, Kovacic called current disclosures "extremely murky."

State AGs are investigating Alphabet and "sniffing around Facebook and other US tech leaders," blogged the University of Florida's Public Utility Research Center Gunter Professor Mark Jamison, writing for the American Enterprise Institute. "The theory behind the AGs’ case is vague at best," wrote Jamison, who was on the FCC transition team for then-President-elect Donald Trump and has consulted for Alphabet's Google. "The AGs shouldn’t pursue broad, naive investigations based on outdated theories of antitrust. If they do investigate, they should limit themselves to complementing" the FTC "inquiries into whether companies have been less than forthcoming with users."

The AG office in North Carolina, one of eight states taking the lead in probing Google (see 1909090060), declined to comment. Representatives of the other lead AGs -- in Colorado, Nebraska, Iowa, Louisiana, Mississippi, Oklahoma and Texas -- didn't comment. The New York AG's office declined to comment.