Thread by @matthewstoller

1. Get ready for a nitty gritty thread on how corporate power is reliant on the Federal Trade Commission, and insider Republicans and Democrats, for its power. As well as some thoughts on why this will change. It starts with a giant little noticed merger this week.

2. This week, the FTC approved the merger of Praxair, Inc. and Linde AG, the second and third largest suppliers of industrial gases in the world. Industrial gases are a key input for industries such as oil and gas, aerospace, steel making, health care, food manufacturing, etc.

3. The consequences of this transaction are unpredictable and potentially dangerous. It will probably raise prices across the economy, and concentrate supply chains in chaotic ways. It's a giant combination of corporate assets. But that's not what makes it interesting...

4. It's a test case of the willpower of the FTC. Linde is German. And bc of German law, the merger had a firm deadline of Wed. Had the FTC challenged the merger, it couldn't have been completed. In other words, the FTC could have blocked the merger *without needing to litigate.*

5. The FTC likes to claim they are limited by funding and courts. Don't blame us for rising corporate concentration, they say. But what this case reveals is that the enforcers themselves, the staff, and 4 commissioners at the FTC, have an ideological preference for concentration.

6. The decision was 4-1. @chopraftc, once again, was the only commissioner to dissent. You can read his dissent here: ftc.gov/system/files/d…

7. Back in August, I did a thread on the FTC's refusal to penalize corporate wrongdoers, or stand up against wage fixing. I mentioned a 4-1 decision. That thread is here:

https://twitter.com/matthewstoller/status/1032997466247979008

8. There have been several more 4-1 decisions. In one, @JoeSimonsFTC, @FTCPhillips, and @MOhlhausenFTC - all Republicans - voted to essentially let off without penalty companies that lied about goods made in China but labeled with Made in USA. Then there's Linde-Praxair.

9. The FTC staffer who ran the review on Linde-Praxair is Michael Moiseyev. Moiseyev oversees pharmaceutical and tech mergers. He's highly capable but ideologically unconcerned about concentration, which is why there are merger sprees in both areas.

10. The FTC is holding a series of hearings, a sort of self-reflection, on their performance. The hearings have turned out to be largely self-congratulatory and silly so far. Meanwhile data breaches at Google and Facebook are happening, and the commission clears this merger.

11. I was initially excited about the new slate of FTC commissioners. Republican @JoeSimonsFTC and @FTCPhillips made noises about being tough-minded on enforcement. So did the Dems, like @chopraftc and Schumer pick @RKSlaughterFTC. But so far...

12. Only @chopraftc has evinced any interest in breaking with the failed status quo. We can see now that the FTC, at every level, has largely adhered to an agenda that has failed. New leadership hasn't reshaped the agenda. There is now a legitimacy crisis for them.

13. One of the key questions is how to essentially deal with an institution like the FTC that doesn't adhere to its mandate of policing markets. Should it be restructured? Reformed? Eliminated? I don't know. One obvious solution is to start sending Federal $$$ to state enforcers.

14. I no longer assume the FTC operates to police markets. Given the chance to block the harmful merger Linde-Praxair merger, they just.. didn't. So to deal w/the problem of monopoly, I think we'll have to go through Congress and the states. Not the FTC. Happy to be proved wrong.

15. (And yes, there are details, and there is an alternative story about why the merger will increase competition, but it's self-evidently stupid. Giant companies don't merge to increase competition.)

16. I'll also note that three Republican FTC Commissioners chose to allow companies lying about Made in USA when importing goods from China to get off without paying anything.

https://twitter.com/chopraftc/status/1039937718233509889

17. We need our markets policed to ensure they are open, there is competition, no fraud, etc. How do we make that happen? Unclear now. @GaneshSitaraman proposes a new anti-monopoly agency. But the conversation is starting. greatdemocracyinitiative.org/wp-content/upl…