The FTC cares more about rulemaking than the American people

At a recent “anti-monopoly summit,” Federal Trade Commission Chairman Lina Khan painted a grim picture of life in the American economy. She warned, among other things, that people’s economic liberties are being undermined. To ask the next obvious question, “By whom, Ms. Khan?”

Khan’s remarks highlight reasonable fears about bogeymen lurking across our economy. But the academic legal theories she’s aggressively promoting to bring entrepreneurs and businesses to heel have resulted in the FTC’s unbalanced response in fulfilling its mission as a consumer protection agency. These misplaced priorities are demonstrably harming American consumers, as a recently released FTC performance report made abundantly clear.

What has a laser-like focus of limited agency resources brought American consumers?

Under Khan, the FTC has embarked on a headline-grabbing spate of lawsuits, rulemaking, and merger reviews, punctuated with fawning media interviews, such as with “The Daily Show’s” Jon Stewart.

Rules like the recent one against “junk fees” are a prime example of the FTC using its powers for the wrong purposes. Essentially, so-called junk fees are the price we pay for junk regulations. Underpinning fees pushed onto consumers are government regulations that raise costs. If the FTC wanted fully informed consumers, it would make the costs of regulation we pay on every good and service we purchase more transparent. A junk fee regulation would do the opposite by adding additional compliance and paperwork costs to businesses that will, again, pass them on to consumers.

These proposed rulings are intended to distract the public from what is actually happening. Our economy is failing, goods and service prices are soaring, and prices are up over 15% with everyday necessities at an all-time high.

Instead of protecting consumers, the FTC is more concerned with pushing narratives that distract Americans from the real issues plaguing our country. These efforts are consuming enormous amounts of the agency’s time.

What has this laser-like focus of limited agency resources brought American consumers? Court losses and widespread acknowledged shortcomings of the FTC’s highest-profile antitrust cases against Microsoft, Amazon, and Meta/Facebook. According to a recent survey of antitrust law professors in the Yale Law Journal, the FTC’s case against Amazon “is the consensus choice for the weakest” among the five major cases brought by federal antitrust enforcers against Big Tech companies.

The Amazon and Meta/Facebook cases put the FTC in the unenviable position of having brought two of the three lowest-regarded cases, all of which have drawn criticism.

Khan let it be known early on that she wanted to bring lots of antitrust cases, leading the New York Times to question the agency’s shift in priorities and strategy. “We’re definitely focusing our resources on litigating,” Khan told the paper. But so far, the FTC has struggled to bring much change to the law or to the welfare of everyday consumers.

In 2023, the agency lost a string of merger challenges in court (Illumina’s acquisition of GRAIL being the only exception). Major defeats for the FTC included Microsoft’s acquisition of Activision Blizzard and Meta’s acquisition of Within Unlimited.

The agency and its allies say that several objectionable deals were abandoned after the FTC filed challenges and that another batch of challenges resulted in settlements. Critics assert that the cost to American global competitiveness has been far too high, while everyday scams and fraud are seemingly running amok.

Congress has never explicitly authorized the FTC to engage in rulemaking for competition issues, recognizing that allowing the agency to simultaneously define and enforce rules could lead to bureaucratic overreach. Yet the FTC is burning more of its resources on lengthy rulemaking proceedings that introduce novel and capricious interpretations of its authority.

The agency had 24 pending rules in the fall of 2022 and 23 during 2023, which is substantially higher than usual. The annual total was as low as 12 during the Clinton and Bush administrations. FTC rulemakings can be time-consuming and labor-intensive, often lasting for years. If the courts overturn any of them, was it worth shooting for the moon instead of focusing on protecting the American consumer?

The immense amount of time spent on all these unnecessary undertakings appears to have further distracted the FTC from its core mission to protect consumers against fraudsters and scams. Lina Khan is more worried about being in the limelight than addressing what is truly harming consumers, leaving the American consumer more vulnerable than ever.