How Antitrust Laws are Being Weaponized for Political Purposes with Dan Schneider and Ashley Baker.

Our next guest is Ashley Baker for the Committee for Justice. Ashley will be able to correct me if I got the title wrong. We're going to talk about a very important policy matter that has real world implications for each of us. It was just two or three years ago, ACU was sued for $150 million. We're a not-for-profit. $150 million because a guy claimed that we had colluded to prevent him from speaking at CPAC. Obviously, we invite lots of people to speak, and so he sued us under the antitrust laws, claiming collusion. It cost us a lot of money to defend us and to get that whole suit dismissed. Ashley, thank you for joining us today. What is going on with antitrust law? Why is this such a big deal? Thank you for having me. Right now, what's going on with antitrust law? In the very beginning, antitrust law was intended to protect economic welfare from illegal activities such as tying, collusion, some of the things in the charges that were against you, although those were completely meritless. It was under the Sherman Act where this started taking place. You guys were sued under the Sherman Act, which has very broad, very vague language. That gets to the heart of what happened in the years between 1890 and the Sherman Act and about the late 1970s when we had the consumer welfare standards. You had this whole period of time in which pretty much every business activity was illegal. Selling shoes and pairs was illegal. Market definition was just anything made of metal. Counting how many firms is in the market on one hand was sufficient analysis, which obviously there are a few problems with that. There was no rigorous economic analysis, and there was also no way to apply this law with any sort of consistency and any sort of regularity. We got from where we were before the consumer welfare standard in which a suit, like the one against you guys, probably would have prevailed. I know that wasn't a government suit, but there's this famous quote in which Justice Potter Stewart says, the sole consistency I can find in antitrust litigation is that the government always wins. That was really the only consistency, so we've come a long way since then. Well, Ashley, of course, this is a leading question. I studied a lot of antitrust law and economics as an undergrad and as a law student and attorney. Who was our big hero coming out of the 70s? Who was the person who brought reason and rational thought to our antitrust laws? Well, the big person coming out of the 1970s, late 60s, late 1970s was Robert Bork. God bless Robert Bork. I'm sorry? God bless Robert Bork. Yes, God bless Robert Bork. He certainly went through a lot, and today we're certainly reminded of that aspect of it as well. In fact, the antitrust, though, his effect on antitrust law really cannot be understated because of the way in which Justice Scalia, for example, during his Supreme Court confirmation hearings was asked about antitrust. He said, well, I never really liked antitrust much. I didn't understand it in law school, and I later realized that there wasn't much to understand. Robert Bork brought that understanding to it because he created something called the Consumer Welfare Standard, which is this neutral underlying principle that can be applied evenly to the law, implied evenly by judges. It's one of these rare incidences in which you have good law and economics that mesh at the same time, and it works to solve all of these problems. Beforehand, we had in the 1960s antitrust being weaponized for all of these left-leaning purposes, such as environmental law and equality and every basket of left-leaning social items that you can imagine. Ashley, in my mind, if I'm going to just summarize real fast what the Consumer Welfare Standard is about, it's basically, are consumers being forced to pay far more for a good than the free market would otherwise allow? Is there price gouging? Is there collusion? Is there conspiracy to drive up prices against the consumer? You mentioned these liberals back then, but we've got liberals today who are now trying to use the same kind of antitrust laws as weapons against people they think are just bad, people like Senator Warren and AOC. What's going on today? How is the left trying to revive their terrible ideas? Back to what the Consumer Welfare Standard is, one thing I would add is it's not solely based on price. It's largely based on price, but a little nuance there is it is kind of a total goal of the antitrust system is how well off the consumer is, as opposed to individual welfare. What value having an iPhone, for example, adds versus not having one. There are some intangible factors, just not these completely irrelevant intangible factors, such as what we see the left imposing on it. Now we have, just like we had in the Break Up Wall Street campaign, for example, that's one instance in which Elizabeth Warren was going after big companies. She has a long track record of running presidential campaigns off of antitrust. They have not worked out very well for her. Now we also see Warren and Klobuchar and others putting forth legislation that would essentially put bans on mergers as one thing, very strong merger guidelines that would be particularly catastrophic during the post-COVID economic recovery when it's harder to acquire small firms whatsoever, even if there's really no solid market basis for that. They're trying to control us. They're trying to control the individual. They're trying to control businesses for reasons other than what's right for the consumer. Yes, and they're trying to undermine the rule of law too, and that's one point that I really wanted to make here is that, for example, one proposal they have would completely invert the burden of proof from the government to the company in proving that they're not a monopoly, and that's very much at odds with the core tenets of the United States legal system. There's a lot here that is at odds with conservative values and with our view of the rule of law, and this has suddenly become popular just because some people don't like certain companies, and I understand why they might not, but I don't think antitrust is the solution for non-competitive problems. Right. Obviously, we've got lots of other laws and lots of other remedies. If a company's engaged in fraud, guess what? We've got fraud statutes. You don't have to try to use the Sherman Antitrust Act or the Clayton Act just as a tool to whack everybody you dislike. Ashley, any last thoughts? Going off of that, I would say that just because one company, and I'm not pointing to any companies, but hypothetically, if one company is in violation of an antitrust law, that doesn't mean all of our antitrust laws need to be reformed. That actually means that they're working, and I think there's a lot of misconceptions over whether or not antitrust laws are being enforced and whether or not they're working, and they have worked very well for the past 40 years, and also, this is one of the largest victories of the conservative legal movement over the past 50 years, and I think that really goes under recognizes where we came from and what we'd be throwing away by stepping away from this standard, and there are some who would like to do that, and that's just a lot of progress that we as a movement have made that is at risk today. Thank you so much, Ashley. Really appreciate your time.