Consumer Welfare On Trial at the FTC

November 2018

Consumer Welfare On Trial at the FTC By Marshall Steinbaum (Roosevelt Institute)¹

On November 1^st, the FTC held its public hearing on the consumer welfare standard, putting the philosophical gulf between critics of the antitrust status quo and its insider practitioners on full display.

By now, the debate follows similar lines: critics of the status quo air their grievances about the state of antitrust law and its enforcement, following decades of conservatizing court opinions and enforcement agencies chastened into weakly enforcing an ever-weaker body of law. Then the insiders strike back with a series of straw man arguments: that the critics want antitrust to solve all of society’s problems, that they misunderstand and mischaracterize what the consumer welfare standard is and what function it serves in contemporary antitrust enforcement, that they want every antitrust case to be a fishing expedition for anything that any of a would-be defendant’s counterparties might not like about their competition, that it invites “political” interference in law enforcement for the purpose of punishing enemies, and that the critics seek a return to a past “pre-economic” era replete with wrongly-decided cases that impaired economic efficiency and themselves constituted anti-competitive restraints.

Defenders of the status quo argue that the “true” consumer welfare standard does not have any of the flaws by which critics indict the status quo—the “true” co