Joe Biden just threw a big punch at corporate monopolies, one of the biggest Executive Branch punches of any president in the last 40 years. In a massive executive order issued on Friday afternoon, he did three things: forcefully rejected the pro-monopoly world view of the last 50 years, issued 72 directives to over a dozen executive agencies, and created a council to ride herd on agencies to make sure they do their job in rulemaking to achieve this vision.
Biden directed agencies to use their rulemaking authority aggressively to stop corporate monopolies in agriculture, defense, pharma, banking, and tech—to name a few. For instance, he directed the Federal Trade Commission (FTC) to ban noncompete agreements, so that employers can’t trap employees but have to actually provide benefits that make them choose to stay. He ordered the Department of Agriculture to use its full power under the Packer and Stockyards Act to break the stranglehold of distributors and other corporate giants that crush farmers and farmworkers. He directed the Consumer Financial Protection Board to issue a rule that would allow bank customers to take their financial transaction data with them to a new bank. He directed federal health officials to enable importation of cheaper drugs from Canada in a direct confrontation with Big Pharma.
Presidential power in this area is technically limited but vast in practice. While some agencies, like the Department of Agriculture, must follow his orders, independent agencies like the FTC don’t have to listen to their president. They can sit on their hands and do nothing. But a clear signal of purpose and vision from the president has, in practice, an enormous energizing effect. It gives cover for agencies that want to be aggressive but find themselves drowned in the arguments by corporate lobbyists. It gives dissidents within somnolent agencies the argument that action is necessary. And it forces agencies that disagree to do some explaining: If any independent agency heads choose not to go forth with the rulemaking in the directive, they’ll be getting lots of questions about why not. For someone like FTC Chair Lina Khan, who undoubtedly was moving in the direction laid out in the directives regardless, it puts the wind at her back, and quiets the corporate critics within the Democratic Party who would be tempted to say that responsible exercise of power is stepping out of line.
But we should not miss the forest for the trees. This executive order is arguably most significant for the economic worldview it represents. If Biden keeps going down this road, it suggests a massive realignment for the Democratic Party and a return to the 1940s–1970s attitude towards corporate concentration.
For Presidents Franklin Roosevelt and Lyndon Johnson, flawed but vitally important leaders, the Democratic Party stood for workers and the people who produced things, and against the middlemen who sought to steal value and control industry. They understood that anti-monopoly laws were partly about keeping prices down—but also about preserving equality and dignity, and making sure that everyone who contributed to the production of goods and services got a fair cut.
In the 1980s and ’90s, the Democratic Party got highjacked by golf-buddy Democrats, who promoted monopolization and offshoring in the name of consumer welfare and efficiency. They got in bed with the corporate middlemen and took their cash, pretending that they could serve two masters: Wall Street donors set on monopolizing industry and workers. They talked about lifting all boats, but their policies led to yachts for the wealthy and stagnation on low wages and humiliating working conditions for others. The prosperity of the few was not shared with the American warehouse worker, driver, nurse, and small business owners. Since Bill Clinton became president, corporate Democrats have been in the driver’s seat when it comes to economic policy, and shut down all dissenters in the antimonopoly policy.
Biden’s executive order is a 180-degree turn, something that could never have come out of Bill Clinton’s White House. Instead, elevating the language of efficiency and the wisdom of a naturalized “market,” Biden’s executive order directly blamed monopolization for diminished wages and working conditions, for growing inequality, and for the collapse of small business in America. This exemplified the unique power of the presidential soapbox in action: Biden’s statement today matters not just for the directives but also as a declaration of policy that every state lawmaker can hold up when she is pushing local anti-monopoly legislation, and that federal lawmakers can use to explain why reforming antitrust laws is so important.
However, one key anti-monopoly question still remains for the president: his choice as the assistant attorney general, Antitrust Division. If he chooses someone aligned with FTC Chair Lina Khan, White House Adviser Tim Wu and soon-to-be CFPB head Rohit Chopra, that will clearly signal that he’s serious about taking on the heart of monopolistic abuses using the full power of his administration. The leading candidate who represents this vision is Jonathan Kanter. On the other hand, if he hedges his bets, and chooses someone more aligned with the antitrust establishment of the last 40 years, he risks creating conflict and tension that will drag down these vital efforts. The DOJ and FTC will be at odds and the White House torn in different directions. Such disagreement between the agencies will not only cause friction but also take time and energy, bleeding the momentum required to make progress.
Biden has a chance to be the first trust-busting presidency in over 50 years—and we keep getting strong signals that he’s got it in his sights. That’s great news for workers, for small businesses, and for the small communities that have been left out in the collapsing concentration of our country for the last 50 years. He’s well on his way, but a strong appointment at the Department of Justice would go a long way towards finishing the job.
