Is the new thinking on antitrust policy right?

Big Tech got some good news when a US district judge dismissed two antitrust cases brought against Facebook by the Federal Trade Commission (FTC) and a group of states. Curiously, the ruling may also be greeted as good news by the Enemies of Big Tech, who say that existing law is not up to the task of prosecuting monopolies and favour a radically different approach.
It so happens that the most prominent advocate of this approach is the new chairwoman of the FTC. Lina Khan is a celebrated young legal scholar whose paper “Amazon’s Antitrust Paradox” (published four years ago, when she was 27) made the case for a thoroughgoing reappraisal of competition policy. Khan’s paper and the rest of the new antitrust literature is valuable — but its prescriptions aren’t persuasive. As a guide for policy, the old approach is a lot closer to being right.
Khan and her intellectual allies argue against the prevailing consumer-welfare standard, enshrined in antitrust law during the 1970s and 1980s under the guidance of Robert Bork and the so-called Chicago School of legal scholars and economists. According to this (suddenly unfashionable) view, the test of whether market power is being abused is to ask one simple question: Is there harm to consumers? If there isn’t, antitrust policy ought to mind its own business.
“Amazon’s Antitrust Paradox” says that this narrow assessment misses the point. Excessive market power gives rise to “a broader set of ills and hazards.” For a start, consumers aren’t just interested in low prices. They also care about quality, variety, innovation, what happens to all the data Big Tech collects, and so on. More important, competition policy should weigh the effects of market power not just on consumers but also on the dominant firms’ suppliers and workers, and on labour more generally. It should also recognise the danger that monopolistic firms pose to the political system. So extensive is this range of ills and hazards, goes the argument, that acting on specific harms is unwise. Antitrust policy should concern itself first and foremost with limiting market power. “[W]e should replace the consumer-welfare framework with an approach oriented around preserving a competitive process and market structure.”
This might seem both reasonable and eminently pro-market. But it has a very odd implication. The revisionists aren’t just saying that there’s more to consumer welfare than short-run changes in prices and output (which is true). They’re saying that consumer welfare, however broadly defined, is the wrong way to think about competition policy. The goal should be to resist market dominance in its own right. Policy should try to curb the growth of potentially dominant firms before they actually become dominant, even if this makes consumers worse off.
As you might expect, the revisionists are reluctant to examine this implication closely. They speculate at length about the opportunities that dominant technology firms could exploit to increase their market power still further. They discuss the ways in which this might one day prove harmful to consumers and others. They have notably less to say about how dominant technology firms are using their power right now to inflict harms on consumers or anybody else.

—Bloomberg