Listening to candidate George W. Bush and his advisers on the campaign trail, you may have gotten the impression that the new President would sweep aside Clinton's antitrust polices like so many cobwebs. His chief economic adviser Lawrence B. Lindsey called Clinton's policies "radical," while Bush once suggested that antitrust enforcement should be limited to policing criminal price-fixing syndicates.
Bush's bark may turn out to be worse than his bite, though. While the new President fashions himself as the heir to the Reagan mantle, he won't blow into town turning antitrust on its head like the Gipper's minions did two decades ago. In fact, Bush is leaning toward a group of mainstream Beltway insiders to take over key trustbusting posts as the Federal Trade Commission and the Justice Dept. Frequently cited names include George Mason University law professor Timothy J. Muris, Coca-Cola Co. in-house counsel Tad Lipski, and Washington (D.C). antitrust attorneys Charles A. James, Phillip A. Proger, and Deborah A. Garza.
Insiders say this group agrees with about 80% of the Clintonites' antitrust legacy. The biggest similarity, not surprisingly, is that W.'s team shares the relatively relaxed attitude toward merger enforcement that characterized the ex-President's policy. Sure, Clinton's team blocked MCI WorldCom's deal with Sprint and the Office Depot-Staples merger. But the same team O.K.'d $2 trillion in mergers in 2000, a 25-fold increase over the last year of the elder Bush's Administration. Most deals will be treated much the same under W. as they were under Clinton.
There's far greater disagreement over the treatment of alleged monopolies in high-growth industries. The Clintonites made antitrust big news by taking on some of the most dynamic companies of the New Economy--Microsoft, Intel, AOL. Under Justice Dept. antitrust chief Joel I. Klein and Federal Trade Commission Chairman Robert Pitofsky, the trustbusters created a new role for government as a guardian of innovation. Klein, for instance, argued for splitting up Microsoft Corp. not because competition would bring prices down but because innovative startups would flourish in a post-breakup world.
FUTURE SHOCK ABSORBER. Don't expect to hear this argument again anytime soon. The Bushies will return to a more traditional standard--that consumers are being hurt--before they act against alleged monoplies. Bush's team will also spend less energy trying to predict the future. Klein and Pitofsky worried not only about monopolies they could see but also about ones they could foresee. Pitofsky, for instance, held up the AOL Time Warner Inc. merger for months working out the competition ground rules for interactive television--an industry that doesn't exist yet.
The Bushies agree that the New Economy poses unique competition problems. And they're all for innovation. But they'll be more cautious in invoking these ideas for dramatic action. The FTC's restrictions aimed at preventing AOL Time Warner from using its distribution system to favor its own programming may turn out to be brilliant, or disastrous. But they never would have been imposed by the Bushies. "They'll be more reluctant to jump into things they don't understand," says Joe Sims, a partner at Jones, Day, Reavis & Pogue.
True enough. But don't mistake a return to a more traditional approach with an end to antitrust enforcement. Trustbusting is alive and well, no matter what President Bush said on the campaign trail.