1_U.S. Antitrust

1_U.S. Antitrust - Amalgamated America - Trust in Markets:...

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Amalgamated America -- Trust in Markets: Antitrust Enforcers Drop the Ideology, Focus on Economics --- From Sherman to Pitofsky, Attitudes About Bigness Have Come a Long Way --- The View From 30,000 Feet By Roger Lowenstein. Wall Street Journal (Eastern Edition). New York, N.Y.:Feb 27, 1997. p. A1 Author(s): By Roger Lowenstein Publication title: Wall Street Journal. (Eastern edition). New York, N.Y.: Feb 27, 1997. pg. A.1 Source type: Newspaper ISSN/ISBN: 00999660 ProQuest document ID: 23844104 Text Word Count 3355 In the late 1970s, a Georgetown University law professor named Robert Pitofsky wrote an impassioned appeal to antitrust enforcers. Though their first concern would be economic, he said, trustbusters should never forget the political part of their charter: making sure that no entity in a democracy becomes too powerful. Otherwise, he warned, America could become a land of economic giants. If companies were allowed to merge merely because of touted "efficiencies," the day might come when as few as four firms would dominate a market. And that, Mr. Pitofsky said, would be, "bad history, bad policy, and bad law." Two decades later, the day has come. Once-unthinkable mergers, from aerospace and banking to health care and telecommunications, are leaving some markets with only a handful of major players. The man approving many of these deals is an older, more tempered but still activist Robert Pitofsky, now chairman of the Federal Trade Commission. With his counterpart at the Department of Justice, Mr. Pitofsky is developing guidelines to formalize the notion he once rejected: that efficiencies from a merger should weigh on the antitrust scales in favor of merging parties. And even a casual observer of the business scene may be given to wonder: What happened to antitrust? The answer has its roots in a counterrevolution that began shortly before Mr. Pitofsky wrote "The Political Content of Antitrust" and that continues to this day. Like other revolutions, it was triggered by the dead hand of an old regime -- in this case the intensely, some would say comically, antimerger policy of the postwar era. But rarely has a revolution been so profound. In government, trustbusters abandoned their political and sociological freight. Rather than judge from on high, as Supreme Court Justice Louis Brandeis did early in the century when he reckoned that bigness was a "curse," antitrust began to focus on microeconomic details, such as the likely results of specific mergers on specific products and prices. As courts turned to economics, they discovered that mainstream economic theory was itself
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being reinvented. The new credo was more accepting of the Invisible Hand -- more market-driven. And the industries that antitrust polices changed beyond recognition. Restive
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1_U.S. Antitrust - Amalgamated America - Trust in Markets:...

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