Biden’s Next Agenda: Anti-monopoly

How enhancing America’s antitrust regime is a winning issue for the administration—and the country.

On the last day of September, David Brooks of The New York Times published one of his “Wow, he sounds like a Democrat” columns that so delight liberals of a certain age. In it, he made an impassioned case for the massive spending bills the Biden administration and congressional Democrats were struggling to advance. 

The trillions of dollars in infrastructure and social welfare investments, he noted, would predominantly benefit ordinary, just-scraping-by Americans, many of them in red states and lacking college degrees. These are precisely the people screwed by the decades-long, upward redistribution of income and opportunity benefiting big corporations and educated elites. Because that wealth transfer unleashed a populist fury that has destabilized American democracy, the Democrats would be sending an important moral and cultural message:

These packages say to the struggling parents and the warehouse workers: I see you. Your work has dignity. You are paving your way. You are at the center of our national vision.

I’d like to think Brooks is right about this. Certainly, the spending would materially improve the lives of downscale Americans. But would the intended message be received? 

I’m not so sure. In March, Biden signed the nearly $2 trillion American Rescue Plan, with features like an expanded child tax credit that the Democrats aimed to make permanent in their reconciliation bill this autumn. Yet even though polls suggest that voters, including many Republicans, appreciated the tax credits and other spending, Biden’s approval numbers ultimately tanked, even among Democrats. The spending didn’t cause the tanking—things like the Delta variant surge and the ugly Afghanistan pullout did. But even with its easy-to-see stimulus checks and extended unemployment benefits, the American Rescue Plan didn’t reposition Biden and congressional Democrats as champions of the common people.

We probably shouldn’t have expected it to. Two trillion dollars might seem like a lot of money. But only about half of it will be spent by the end of 2021. That’s less than 5 percent of the nation’s projected 2021 GDP of $22.74 trillion. 

The truth is that even relatively large bumps in federal spending tend not to register with most voters compared to the dynamics of a much larger market economy that they experience daily. Brooks himself basically acknowledged as much:

These measures would not solve our problems, obviously. In many large Western nations, there are vast tectonic forces concentrating wealth in the affluent metro areas and leaving vast swaths of the countryside behind. We don’t yet know how to do the sort of regional development that reverses this trend. 

Ah, but David, we do know, as the Washington Monthly has explained for a decade. Spending is only one tool the federal government has to address problems like regional inequality. It can also shape how markets themselves behave, through regulations and antitrust enforcement. It did so in the Progressive Era, and again in the second half of the New Deal. The result was that heartland economies in the middle decades of the 20th century reversed their previous declines and median incomes there grew closer to those of the coasts. All that progress began to recede in the late 1970s and early 1980s as administrations of both parties deregulated industries and eased
antitrust enforcement. 

The good news is that the Biden administration gets this. In July, the president issued a sweeping executive order instructing federal agencies to crack down on consolidation across the American economy using existing statutory powers that have mostly lain dormant for years. He has also appointed smart, aggressive regulators like Federal Trade Commission Chair Lina Khan, who has written pioneering articles on antitrust for the Monthly. And there is a burgeoning movement in Congress to strengthen antitrust laws governing everything from tech to agriculture—a movement that, unlike spending efforts, has broad bipartisan support. You can read about these current efforts, and what else needs to be added to the agenda, in the special “Unwinding Monopolies” report in this issue of the Washington Monthly.

The bad news is that most Americans have no idea that any of this is happening. All they see in the news is partisan bickering over massive spending bills. And the thought leader journalists who should be educating them on how enforcement and enhancement of antitrust laws can make their local economies more competitive and raise wages are either ignorant about or silent on the subject. Google “David Brooks monopoly” and see what you get.

All is not lost, however. In 2022, with the biggest battles over spending likely behind him, Biden will be free to focus his attention, and the nation’s, on actions his government is taking to challenge monopolies and restore competition. He can do so mostly without asking Mitch McConnell’s permission, and without spending additional taxpayer money. That’s a much stronger position for Biden and his party going into the midterm elections. And it just might save the country. 

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Paul Glastris

Paul Glastris is the editor in chief of the Washington Monthly. He is writing a book on America's involvement in the Greek War of Independence.