WASHINGTON – Confirmation of a third Democrat in the Federal Trade Commission on Wednesday broke the guerrilla deadlock in the agency. This is good news for Lina Khan, chairwoman of the agency and Democrat.
This is also a test.
With the FTC’s new Democratic majority – which came with the confirmation of Alvaro Bedoya, who is becoming the fifth commissioner, in a vacant post since October – Ms. Khan’s allies and critics are watching to see if she can advance corporate appeal plans. Power. This could include filing an antitrust lawsuit against Amazon, enforcing online privacy policies, and using lesser-used agency powers for the wings of companies such as Meta, Apple, and Google.
With Congress deadlocked and by-elections approaching, agencies like the FTC and the Department of Justice are likely to be the best hope for activists and politicians who want the government to limit corporate power. President Biden, who promised a crackdown, last year ordered the FTC and other federal agencies to take action to limit concentration.
At the time of Ms. Khan, 33, who became chair in June, the FTC was already trying to stop the merger and threatened to protest the deals after they closed. The commission said it would punish companies that make it difficult for consumers to repair products. And he settled the case with a company that was once known to Weight Watchers as a diet app that collected data from young children.
But Ms. Khan’s new Democratic majority is necessary for a broader “realization of her vision,” said William E. Kovacic, former chairman of the FTC, “and the clock is ticking.”
In a statement, Ms. Khan said she was “excited” to work with Mr Bedoya and other commissioners. He did not talk about how the new majority of the FTC will affect his plans.
The previous FTC split between the two Republicans and the two Democrats led to a stalemate. In February, the commission failed to reach an agreement to study the practice of pharmacy beneficiaries.
Sarah Miller, executive director of the American Economic Liberties Project, a progressive group seeking more antitrust enforcement, described two FTC Republicans, Noah Phillips and Christine Wilson, as “libertarians” who “braked the woman.” Khan’s ability to move forward in his agenda.
Mr Phillips said in an email that he supported the commission’s “long tradition of bipartisan work to advance the interests of American consumers”. But he will not support Ms. Khan’s agenda when she “exceeds our legal authority,” raises prices for consumers or harms innovation, she said.
Ms. Wilson referred to three of her speeches over the past year in which she criticized Ms. Khan’s philosophy. In one of her speeches last month, Ms. Wilson said Ms. Khan and her allies adhere to the principles of Marxism.
Sen. Chuck Schumer of New York, the leader of the Democratic majority, said Wednesday’s vote, endorsing Mr Bedoya, was “a crucial factor in unlocking the FTC”.
Now Ms. Khan can gain the ability to file a lawsuit against Amazon. He wrote a student law review article in 2017 in which he criticized the company’s dominance. The FTC has launched an investigation into the retail giant under the Trump administration; Some attorneys general have also conducted investigations into the company.
Ms. Khan could sue Amazon over the recent acquisition of Metro-Goldwyn-Mayer Studios. When the $ 8.5 billion transaction closed in March, an FTC spokesman said the agency “could appeal the deal at any time if it found it was breaking the law.”
Ms. Khan might put her stamp on other deals. The agency is investigating Microsoft’s acquisition of video game publisher Activision Blizzard for $ 70 billion, and this year sent companies a request for more information.
Mr Biden’s executive order last year, which encouraged more aggressive antitrust policies, prompted the FTC and the Department of Justice to update the guidelines they use to approve transactions, which could lead to tougher scrutiny. Ms Khan will likely need the support of two other Democrats on the commission, Mr Bedoya and Rebecca Kelly Sloter, to approve aggressive new guidelines or challenge a major merger.
Ms. Khan also said she wants to strengthen the agency’s authority by complying with privacy regulations and by making algorithmic decisions. He said the FTC had misused its role as a rule-making body and that the regulations would strengthen its mandate to protect consumers.
“Given that our economy will only continue to digitalize further, market rules can help make a clear note and enforce enforcement more effective and efficient,” he told a confidentiality conference last month.
The FTC can also influence the demands of progressive activist groups who want the agency to ban database-driven advertising business models and ban non-competitive agreements that stop workers from getting jobs with their current employer competitor.
But former FTC officials said Ms. Khan was facing challenges, even in the case of a Democratic majority. Creating privacy regulations can take years, said Daniel Kaufmann, a former deputy head of the agency’s Consumer Protection Bureau. Businesses are likely to sue for rules that do not fit the FTC mandate to protect consumers from fraudulent and unfair practices.
“The FTC’s ability to set rules is not designed for behavioral advertising, so I was telling my clients that the agency could do something through multiple presses, but it is unclear where it will go,” said Mr Kaufman, partner. This was announced by the law firm BakerHostetler.
Ms. Khan’s efforts will also inevitably continue to resist Mr. Phillips and Ms. Wilson. Mr. Phillips said he has a reservation that the agency will become a more muscular regulator. In January, he said new privacy rules should be set by Congress, not the FTC.
Ms. Wilson recently released an in-house survey screenshot showing that FTC career staff satisfaction has fallen. “The new leadership has marginalized and disrespected staff, leading to a brain drain that will take generations to correct,” he said.
To overcome their resistance, Ms. Khan will have to maintain a majority. This gives leverage to Mr Bedoya, a privacy expert focusing on new technology civil rights threats, and Ms. Sloter, a former senior member of Senator Sumer’s staff.
Ms Sloter said in a statement that Mr Bedoya’s privacy expertise would serve the FTC well. He did not comment on the agency’s democratic majority.
Mr Bedoya was adamant about his plans and only said he was “excited” to work with his new FTC colleagues.