The historical divide: economic structuralism vs. consumer welfare
At the core of antitrust regulation, two schools of thought have historically jostled for leadership. In much of the 20th century, the theory of economic structuralism dominated. This theory – notably advocated by US Supreme Court Justice Louis Brandeis – propounded the idea that concentrated market structures promote anticompetitive behaviour. The theory also recognised conflicts of interest as an area of focus. For example, economic structuralists highlighted the risk of allowing a dominant clothing supplier to enter the clothing retail market, fearing that the supplier may use preferential access to its product to entrench its position versus other retailers. The theory underpinned enforcement up until the 1970s, with courts blocking mergers which were determined to lead to uncompetitive market structures.
In the 1970s and 1980s, as with many other parts of political and economic policy, theories originating from an American ‘freshwater’ university began to challenge the incumbent doctrine. The ‘freshwater’ universities (so named due to their proximity to the American Great Lakes), began challenging the prevailing doctrine espoused by the ‘saltwater’ universities (those lining the American east and west coasts, such as Havard, Yale and the University of California).
The theory emanating from the University of Chicago – and most closely associated with Robert Bork, Former Solicitor General of the United States– departed from the prevailing focus on market structure, focusing instead on consumer welfare as the metric for assessing competition. If consumers didn’t receive higher prices, the concentration of a market was not inherently a concern.
Big Tech in the spotlight
Once the focus on consumer welfare supplanted economic structuralism, many industries saw significant consolidation. The defence, healthcare and tech industries have all seen the big get bigger, with oligopolistic structures now the norm. The 1998 US government case against Microsoft, for illegally monopolising the web browser market, represents an aberration in the general trend of antitrust regulation at the time.
This consolidation across industries has not gone unnoticed in antitrust circles and, over the last decade, many have advocated a return to a focus on economic structuralism – as practiced by Brandeis over half a century ago.
A target for DOGE is likely to be antitrust enforcement.
The rise of the ‘neo-Brandeisians’ was evident throughout President Biden’s administration. Antitrust enforcement in the US is split between the Department of Justice (DoJ) and the Federal Trade Commission (FTC). Biden appointed Big Tech sceptics to head of both agencies. The former FTC Chair, Lina Kahn, famously wrote a paper at Yale highlighting the anticompetitive tactics of Amazon. Khan alleged that the prevailing Chicago school methodology was inadequate for regulating online platform businesses.
The neo-Brandeisians focused on two areas: merger control and business model regulation, with the latter arguably the most consequential for America’s tech giants. Just before Biden’s arrival, in 2020, the DoJ brought a case against Google, alleging it had monopolised the search and advertising markets. The verdict delivered in August 2024 ruled that Google acted illegally to maintain a monopoly in online search. Since then, remedies proposed by the DoJ have focused on forcing Google to divest parts of its business and share more data with peers. Whilst continued watering down of remedies is likely, this represented a step up in antitrust scrutiny.
Given Kahn’s background it came as little surprise when, in September 2023, the FTC sued Amazon, alleging that it was a monopolist that stifled competition, reduced quality and subsequently raised prices for consumers. The lawsuit echoed many of the concerns Kahn had detailed in her paper six years earlier and was again emblematic of a shift in antitrust rhetoric. Both Meta and Apple have received increased antitrust scrutiny too.
Remedies proposed by the DOJ have focused on forcing Google to divest parts of its business and share more data with peers.
A firmer approach to antitrust regulation is not just a North American phenomenon. Outside of the US, the implementation of the EU’s Digital Markets Act (2023) and Digital Services Act (2024) has provided more teeth to European regulators to curtail the power of the Big Tech companies.
Trump and Tech’s complex relationship
The question that now poses itself, is how regulation of Big Tech will change under President Trump’s second term. With the traditional Republican penchant for hands-off regulation, and judging by the amount of Big Tech bosses occupying front-row seats at Trump’s inauguration, one would be forgiven for assuming a more modest approach to antitrust is inevitable. We would argue, as is common with much Trumpian policy, that such a view is too simplistic and in fact his thinking on the topic doesn’t always comply with traditional Republican norms.
Trump’s first presidency demonstrated anything but a laissez-faire approach to antitrust and the Google case mentioned above was first filed at the end of Trump’s first term. The President has also often had a fractious personal relationship with certain Big Tech bosses, most notably Amazon’s Jeff Bezos. Even before his election in 2016, Trump attacked Bezos on X (Twitter at the time). The feud seems to have stemmed from Bezos’s personal ownership of the Washington Post, which was critical of Trump in the lead up to and during his first presidency. Trump consistently, and erroneously, alleged Bezos bought The Post to lower Amazon’s taxes and that Amazon was the owner of The Post. Recently, Trump’s relationship with Bezos and the wider Big Tech group does seem to have improved, but Trump is famously capricious.
J.D. Vance, Trump’s VP pick, is also an antitrust hawk and has in the past been a surprise supporter of Lina Kahn’s work under the Biden administration. The pro-worker, pro-consumer, anti-elite narrative is one rare area of often bipartisan agreement.
Trump’s first presidency demonstrated anything but a laissez-faire approach to antitrust.
More recently though, the closer tie between Trump and Big Tech is hard to ignore, most notably, the appointment of Elon Musk to the newly created Department of Government Efficiency (DOGE). This burgeoning relationship between Big Tech and the Trump administration is surely positive for Silicon Valley while it lasts.
A target for DOGE is likely to be antitrust enforcement. The One Agency Act, recently reintroduced by US Congressman Ben Cline, would aim to combine FTC and DoJ’s enforcement capabilities under the roof of the DoJ. This combination would increase executive control over antitrust. The president can fire political appointees at the DoJ, whereas the FTC is a bipartisan agency independent of the executive, where commissioners can only be fired with cause. Whilst nothing has been confirmed yet, Cline has met with Elon Musk to discuss the proposal, and it does intuitively fit with DOGE’s focus. What this means for Big Tech regulation is less certain, given Trump’s uneven commitment to antitrust enforcement. Either way, it would make the Big Tech companies more sensitive to whims of the president.
Four more years of uncertainty
The last five years have seen the rise of economic structuralism and the neo-Brandeisians. Whilst nurtured under a Biden presidency, the uptick in antitrust scrutiny began under Trump. Newfound bonds with the likes of Elon Musk and the increasingly symbiotic relationship between Trump and Big Tech will likely temper this regulatory fervour for now. Yet, if history is any guide, the often-erratic policymaking of President Trump is hard to predict and a swing back toward a more hawkish position should not be discounted.
