Tom Donlan on the Government's Renewed Antitrust Scam

Yet another excellent editorial by America's top (IMHO) editorial writer. Tom Donlan in Barron's writes:

Antitrust is one way for a lawyer to make a big splash, and this year's award for diving into the shallow end goes to Christine Varney, assistant attorney general in charge of the U.S. Department of Justice's Antitrust Division.

"The recent developments in the marketplace should make it clear that we can no longer rely upon the marketplace alone to ensure that competition and consumers will be protected," Varney said last week, piling myth upon misunderstanding.

She was trying to strengthen the peculiar notion that "we" (whoever "we" may be, and it ain't us) have been free to rely on the marketplace for those supposedly desirable protections of competitors and consumers.

Not since the creation of the Interstate Commerce Commission in 1887 has the marketplace provided the final word for either one. Varney's misreading of history is just another wrong note in the currently fashionable chorus of claims that the administration of President George W. Bush played fast and loose with economic regulation.

Another part:

Like other crooks, many politicians go where the money is, so government monopolies are especially common in the financial marketplace. That fractured market does show just how dangerous government-sponsored monopolies can be.

And another:

In a market unfettered by the idea that government will or can protect competition and consumers, risks will be evaluated more cautiously.

This is the truth about the marketplace that Varney doesn't trust to "protect" competition and consumers: In finance, it has been rigged by the government to manage and limit competition and to indulge consumers who could have done a better job of looking out for their interests.

If Varney wants to get tough on monopolists, she should start with Congress and the federal regulatory agencies.

Read the entire thing. The Political Class is not your friend.

Comments

[rtts]

This must be one of the most disjointed, not to mention nut job wrong rants I have heard. First and foremeost, it makes the mistake of equating antitrust enforcement to regulation. Actually, antitrust enforcement serves as the opposite of regulation as it promotes competition by assuring that companies actually compete. I.e., in return for not being regulated in the sense of an agency that sets prices, routes, product specs, etc, antitrust is to assure that the private sector does not substitute its own market manipulation for the government's.

The Bushies ignore that. Yes, some antitrust enforcement approaches can be shown to have anticompetitive effects, but that is rare, especially in the context of the last 8 years of virtually no enforcement at all.

if we want to save capitalism, we need to have it stay true to its justification in the first place . . .and that is that it fosters competition.

[John]

rtts: Well, I'm probably a nut job myself, since I'd be happy to see most antitrust regs repealed. :-)