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President Trump's antitrust enforcers recently took two steps towards repudiating the radical approach associated with the Biden-era antitrust team of Federal Trade Commission Chair Lina Khan and Justice Department Antitrust Division head Jonathan Kanter.
These changes will benefit businesses, workers, and consumers.
The first piece of good news is the FTC has reached a tentative settlement with Southern Glazer's, America's leading distributor of wine and spirits. The case, which was brought in December 2024, alleged that the company violated the Robinson-Patman Act.
Robinson-Patman is a New Deal-era law that outlaws price discrimination, which former federal judge Robert Bork called "the Typhoid Mary of antitrust." Specifically, the law forbids a distributor from providing its product to a large retailer at a lower cost than that offered to smaller ones.
The law was enacted to protect "mom and pop" stores from large retailers like JCPenny, Woolworths, and A&P, (the Amazon, Walmart, and Target of that time). The problem with the law, and the reason the federal government did not file a suit enforcing Robinson-Patman from 2000 until 2024, is it ignores the legitimate business reasons for a distributor to give discounts to big stores like Walmart or Target: a larger store can take advantage of economies of scale to sell more products at a lower price than smaller ones.
This lower price means that more consumers will patronize the bigger store, allowing distributors and manufacturers to profit by selling more products at a lower price per unit. This arrangement benefits consumers, who pay lower prices, as well as businesses, who earn higher profits.
Enforcement of Robinson-Patman may benefit a few small retailers, but it will do so by increasing costs at Walmart and Target. There is never a good time for government officials to take actions that will raise consumer prices, but it’s particularly unwise to do so when many Americans are already struggling with high prices.
The second piece of good news is Associate Attorney General Stanley Woodward has ordered department attorneys to focus on reaching settlements instead of going to trial. This is a welcome change from President Trump's first Assistant Attorney General for Antitrust Gail Slater.
Slater, who previously served as economic advisor for then-Senator JD Vance, is a "Khanservative," meaning someone who supports using the aggressive approach to antitrust enforcement pioneered by Lina Khan and her allies to advance conservative goals.
One trait Khanservatives share with their progressive counterparts is a fear of "big tech" companies. During her conformation hearing, Slater said, "While nobody wants tyranny.gov tyranny.com is not much better."
Slater, like the progressive left and, unfortunately like most of the "post liberal" right, fails to grasp that what makes the government menacing is that every "request" the government makes of its citizens is backed by the threat of force. In contrast, big tech companies cannot force individuals to use their products; they must offer a good or service that consumers desire. This distinction means that tyranny.com is actually not tyranny at all.
Slater "resigned" her position in February. Her resignation came after she clashed with then-Attorney General Pam Bondi over her objections to a settlement that would have allowed leading tech company Hewlett-Packard to acquire fellow tech company Juniper. Slater also objected to a settlement of the antitrust case against Ticketmaster's parent company Live Nation.
Settlements allow mergers and acquisitions to proceed as long as the businesses involved agree to certain conditions, such as requiring one or both companies to sell off one of their existing subsidiaries. Settlements thus allow business to address concerns antitrust enforcers have about a merger or acquisition without blocking a transaction that could benefit not just the businesses' owners, but workers and consumers as well.
Associate Attorney General Woodward's order that Justice Department antitrust attorneys seek settlements instead of going to trial and the FTC's apparent rejection of Lina Khan's efforts to increase prices by reviving Robinson-Patman enforcement are encouraging signs the Trump administration is returning to a restrained and consumer focused approach to antitrust enforcement.
Hopefully the administration will continue to reject the Biden-era anti-business, anti-worker, and anti-consumer approach to antitrust policy.
Charles Sauer is a seasoned economic policy expert, author, and founder of the Market Institute. Sauer authored the book, "Profit Motive: What Drives the Things We Do" and is a frequent voice appearing in outlets like the Washington Examiner, Forbes, Investor's Business Daily, and many more. Charles has also been named to Washingtonian's list of the "Most Influential People Shaping Policy" for four years.
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• A health care crook exposed a system costing taxpayers millions