ACSBlog

Editor’s Note: This is the final post in an ACSblog debate on antitrust scrutiny of Google between Harvard Business School Professor Benjamin G. Edelman and George Mason University School of Law Professor Joshua D. Wright. This online debate follows a recent U.S. Senate hearing on whether Google’s business practices “serve consumers” or “threaten competition.” See all the posts here.

By Joshua D. Wright, Professor of Law, George Mason University School of Law

Professor Edelman’s opening post does little to support his case.  Instead, it reflects the same retrograde antitrust I criticized in my first post.

Edelman’s understanding of antitrust law and economics appears firmly rooted in the 1960s approach to antitrust in which enforcement agencies, courts, and economists vigorously attacked novel business arrangements without regard to their impact on consumers.  Judge Learned Hand’s infamous passage in the Alcoa decision comes to mind as an exemplar of antitrust’s bad old days when the antitrust laws demanded that successful firms forego opportunities to satisfy consumer demand.  Hand wrote:

we can think of no more effective exclusion than progressively to embrace each new opportunity as it opened, and to face every newcomer with new capacity already geared into a great organization, having the advantage of experience, trade connections and the elite of personnel.

Antitrust has come a long way since then.  By way of contrast, today’s antitrust analysis of alleged exclusionary conduct begins with (ironically enough) the U.S. v. Microsoft decision.  Microsoft emphasizes the difficulty of distinguishing effective competition from exclusionary conduct; but it also firmly places “consumer welfare” as the lodestar of the modern approach to antitrust:

Whether any particular act of a monopolist is exclusionary, rather than merely a form of vigorous competition, can be difficult to discern: the means of illicit exclusion, like the means of legitimate competition, are myriad.  The challenge for an antitrust court lies in stating a general rule for distinguishing between exclusionary acts, which reduce social welfare, and competitive acts, which increase it.  From a century of case law on monopolization under § 2, however, several principles do emerge.  First, to be condemned as exclusionary, a monopolist's act must have an "anticompetitive effect.”  That is, it must harm the competitive process and thereby harm consumers.  In contrast, harm to one or more competitors will not suffice.

Nearly all antitrust commentators agree that the shift to consumer-welfare focused analysis has been a boon for consumers.  Unfortunately, Edelman’s analysis consists largely of complaints that would have satisfied courts and agencies in the 1960s but would not do so now that the focus has turned to consumer welfare rather than indirect complaints about market structure or the fortunes of individual rivals. 

By Kent Greenfield, a law professor and Law Fund Research Scholar at Boston College Law School.

Americans love to be able to choose. The typical grocery store has more than 45,000 different items; the average American family has access to about 120 television channels. Glenn Beck opines, “for us to be able to choose, that’s a blessing.”

An analogue to the fixation on choice is the focus on personal responsibility.  Because people make choices, they should be able to take personal responsibility for those they make. This sounds like something all of us could agree on, even in this especially tendentious moment in political history.

My new book, The Myth of Choice: Personal Responsibility In a World of Limits, articulates some reasons to question this mantra of choice and personal responsibility.

Choice is limited in all kinds of ways. Humans are limited by brain science, habit, authority, culture, and the so-called “free” market, which restricts as much as it empowers. We are easily overwhelmed by choice. Consider the grocery store and television statistics mentioned above -- studies show that people are happier when they choose among fewer, not more, items; television viewers may want lots of channels but actually watch only a handful. 

Acknowledging the limits on choice is the first step toward recognizing the insidious nature of “personal responsibility” rhetoric. More and more, those on the right equate “personal responsibility” with choice. It is not about maturity or accountability but simply another way of saying that individuals get to make choices for themselves; they are masters of their fate.

This brand of personal responsibility is used to oppose health care reform, support tort reform, and explain away problems of homelessness or delays in hurricane response. It uses a respect for individual choice to make the political point that government should be small, uninvolved, and deferential to individual decisions.