The proposed AT&T/T-Mobile merger is drawing the usual antitrust scrutiny. Fearful competitors say the $39 billion deal will make the market less competitive. Or so they say. Over at the Daily Caller, I point out that actions speak louder than words:
[I]f Sprint is willing to devote resources to fighting the AT&T/T-Mobile merger, then it probably thinks the new post-merger company will be more competitive, not less. That cuts directly against their main argument – that the merger reduces competition.
Put yourself in Sprint’s shoes for a minute. If your competitors are making what you think is a foolish business decision, you’re not going to try to stop them. If anything, you’ll actively encourage them.
Instead, Sprint’s opposition is proof positive that it thinks the competition is about to get more formidable, not less.
Antitrust authorities, blind to that obvious fact, stand a real risk of stunting the competitive process. They should ignore competitors’ pleas for special government favors and let the merger succeed — or fail — on its own terms. Real competition happens in the market. Not in Washington.
Read the whole article here.
The Constitution’s Commerce Clause gives Congress the power to regulate commerce. What does that mean, exactly? Over at the Daily Caller, my colleague Jacque Otto and I explain that regulation is about making commerce regular: no barriers to entry or trade, clear, understandable, and consistent rules, and so on.
Most of what people call regulation doesn’t have anything to with regular commerce. These kinds of rules are more accurately called interventions.
These interventions didn’t appear out of thin air, either:
One important reason regulators intervene is that many businesses want them to — businesses spend considerable effort and resources lobbying Washington to that end. For the most part, American companies compete on quality, price, or other consumer preferences. But on too many occasions, some companies try to use regulatory interventions to dispatch the competition. Sprint’s efforts to squander AT&T’s proposed purchase of T-Mobile are emblematic of this troubling trend.
Lessons abound for antitrust regulators — sorry, interveners.
Posted in Antitrust, Economics, regulation
Tagged Antitrust, at&t merger, at&t t-mobile merger, commerce clause, constitution, interveners, intervention, irregular commerce, regular commerce, regulation, regulators, sprint