I agree that blocking the iRobot acquisition and others in the Khan FTC were mistakes.
However, to your bigger examples:
1. Spirit Airlines rejected a merger with Frontier in pursuit of more money from JetBlue, knowing there was a lower likelihood such a deal would be approved. Even the simulations you ran show the result JetBlue/Spirit entity would likely have failed with the fuel price shock which did kill Spirit (From the simulator: "Distress risk is real. At this leverage ratio, the merged entity would be vulnerable to any external shock. Bond markets would price the debt at high-yield spreads, adding to the burden.").
2. Adobe was, unquestionably, a monopoly. Forget about measuring iterations in weeks, there had been no competition in design for over 3 DECADES. Instead of your claim that "regulators decided the future of design software competition was better managed from Washington than from the market." they thought we needed some competition, which is their job. They were right, as Adobe had to slash their prices and design software has more choices at lower price points.
3. Your criticism of Kroger-Albertsons is self-contradictory. You can't complain we have consolidation in airlines with the big 4, then complain when they prevent hyper-consolidation in supermarkets. The top 4 supermarket chains already control 50% of the grocery business in the US, which is exactly when regulators get ahead of consolidation. https://www.ers.usda.gov/topics/food-markets-prices/retailing-wholesaling/retail-trends
Your larger point that we should "just trust the market" is something we long ago disproved in American history during the age of Standard Oil, etc. Our anti-trust system designed to avoid that, and while you might disagree with their motivations I don't see much evidence they acted against that mandate.
Thanks for the comment here, knew you'd have thoughts, and glad we have common ground on iRobot.
We hold different opinion on Spirit and that's okay, I don't agree anyone has a monopoly on design software (or any software), and KR-Albertsons argument is similar to Airlines in that the government is basically shoring up the space for the larger companies and stopping a new proper competitor from forming.
BTW I mentioned in the story, perhaps too briefly, I think there should be *some* antitrust, and your example of oil (or any scarce resource) being consolidated makes a lot of sense. That’s exactly where intervention is most defensible, when we have true bottlenecks, limited substitutes, and markets can’t realistically correct.
Where I think we mostly diverge is how broadly that logic should be applied, which is totally fine, great even - it does seem like that specific debate may have not been happening internally during the Kahn admin as witnessed by the obvious errors. And that absence of internal debate is exactly how you end up with policy that looking in feels more ideological than empirical.
Every administration makes errors in judgement about mergers, sometimes allowing too many and sometimes blocking too many. However, you need to look past their motivations to the results to understand if the outcomes match expected historical performance. To make your case you'd have to show it was worse for Khan.
In this case there isn't much evidence they did worse than previous FTCs even if you disagree with their reasoning.
I agree that blocking the iRobot acquisition and others in the Khan FTC were mistakes.
However, to your bigger examples:
1. Spirit Airlines rejected a merger with Frontier in pursuit of more money from JetBlue, knowing there was a lower likelihood such a deal would be approved. Even the simulations you ran show the result JetBlue/Spirit entity would likely have failed with the fuel price shock which did kill Spirit (From the simulator: "Distress risk is real. At this leverage ratio, the merged entity would be vulnerable to any external shock. Bond markets would price the debt at high-yield spreads, adding to the burden.").
2. Adobe was, unquestionably, a monopoly. Forget about measuring iterations in weeks, there had been no competition in design for over 3 DECADES. Instead of your claim that "regulators decided the future of design software competition was better managed from Washington than from the market." they thought we needed some competition, which is their job. They were right, as Adobe had to slash their prices and design software has more choices at lower price points.
3. Your criticism of Kroger-Albertsons is self-contradictory. You can't complain we have consolidation in airlines with the big 4, then complain when they prevent hyper-consolidation in supermarkets. The top 4 supermarket chains already control 50% of the grocery business in the US, which is exactly when regulators get ahead of consolidation. https://www.ers.usda.gov/topics/food-markets-prices/retailing-wholesaling/retail-trends
Your larger point that we should "just trust the market" is something we long ago disproved in American history during the age of Standard Oil, etc. Our anti-trust system designed to avoid that, and while you might disagree with their motivations I don't see much evidence they acted against that mandate.
Thanks for the comment here, knew you'd have thoughts, and glad we have common ground on iRobot.
We hold different opinion on Spirit and that's okay, I don't agree anyone has a monopoly on design software (or any software), and KR-Albertsons argument is similar to Airlines in that the government is basically shoring up the space for the larger companies and stopping a new proper competitor from forming.
BTW I mentioned in the story, perhaps too briefly, I think there should be *some* antitrust, and your example of oil (or any scarce resource) being consolidated makes a lot of sense. That’s exactly where intervention is most defensible, when we have true bottlenecks, limited substitutes, and markets can’t realistically correct.
Where I think we mostly diverge is how broadly that logic should be applied, which is totally fine, great even - it does seem like that specific debate may have not been happening internally during the Kahn admin as witnessed by the obvious errors. And that absence of internal debate is exactly how you end up with policy that looking in feels more ideological than empirical.
Every administration makes errors in judgement about mergers, sometimes allowing too many and sometimes blocking too many. However, you need to look past their motivations to the results to understand if the outcomes match expected historical performance. To make your case you'd have to show it was worse for Khan.
In this case there isn't much evidence they did worse than previous FTCs even if you disagree with their reasoning.