The President Is Meddling in Massive Corporate Me

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The President Is Meddling in Massive Corporate Mergers. What Could Go Wrong?

Long live the plutocracy.

By Charles P. Pierce

Jan 25, 2017


Is this a banana republic or simply a republic that's gone bananas? Inquiring minds want to know. It's becoming harder by the day to distinguish the administration's purely ideological motives from its bone-deep desire to hoover the nation's wealth upwards into the burgeoning plutocracy.

The good folks at ProPublica have a deep gray study into the president*'s conspicuous involvement in a new spasm of giganto-mergers.

By meeting with the CEOs of Monsanto and Bayer as well as the head of AT&T, which is trying to merge with Time Warner, Trump has violated decades of White House practice by injecting himself directly into mergers awaiting Justice Department review.

"The public should be concerned that the career attorneys' and economists' analysis of the deals is not what the decision is going to be made on," said Holt Lackey, a former antitrust counsel to the Republican-led House Judiciary Committee.

Several former Justice Department antitrust officials said in interviews they are worried that Trump will cut deals with companies that could hurt American consumers. "If a transaction is harmful to competition and merging companies raise prices to consumers by 10 to 15 percent, it would not be good to allow that to happen just because the merged companies created some jobs," said Gene Kimmelman, who was chief counsel in the Antitrust Division during the Obama administration. "That would be a horrible trade-off."

The most obvious problem with this arrangement is the fact that the president* believes himself to be somewhere between Jay Gould and Talleyrand when it comes to striking deals. It's his entire identity, as near as I can tell. So, naturally, he thinks he knows more about everything than do the lawyers and economists from both political parties who have dedicated their careers to studying the deleterious effects of massive corporate consolidation.

Merging companies typically tout the benefits of proposed deals. But antitrust enforcers spend a lot of time scrutinizing whether those benefits would actually result from the merger, rather than from business decisions that would have been made anyway.

And antitrust experts said that if Trump pushed the Department of Justice to allow a merger through in exchange for a promise of job creation, such a pledge would be difficult to enforce.

What would happen, for example, if the company reneged on adding jobs after the merger had been completed? Trump's meetings with CEOs have raised concerns inside the Justice Department itself. "It is troubling that presidents of companies whose cases are before the Antitrust Division would be meeting with the president-elect," said one DOJ antitrust staffer.

"We're a law enforcement agency and we pride ourselves on enforcing the law and looking at a case objectively and deciding whether it would or would not violate the antitrust laws."

Antitrust laws have been steadily weakening ever since the Reagan Administration. It was their encroaching feebleness that allowed for the massive M&A boom in the 1980s, from which the administration has drawn many of its gray eminences. (Carl Icahn!)

Now, it appears, they're simply being ignored. But, hey, Dow 20,000! Bananas for everyone!

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