On February 14, 2023 Christine Wilson, the one remaining Republican on the Federal Trade Commission (FTC) announced her forthcoming resignation saying that Chair “Lina Khan’s disregard for the rule of law and due process make it impossible for me to continue serving” in an open letter published in the Wall Street Journal. In the letter Wilson said that there had been a ton of ink “spilled about Khan’s attempts to remake antitrust law” as FTC Chair, but not much ink spilled about Khan’s “disregard for the rule of law and due process and the way senior FTC officials enable her,” before giving several specific examples.
Now House Oversight Committee Chair James Comer (R-KY) wants to know more about the allegations raised in Wilson’s letter and has launched an investigation into the matter. He sent a letter to Khan requesting that several categories of documents be produced to the committee before June 15. The examples listed in the Oversight letter are as follows:
Commissioner Wilson highlighted several key matters related to her resignation. First, she pointed to Chair Khan’s refusal to recuse herself from review of Meta’s proposed merger with Within Unlimited, even though Chair Khan had stated publicly before joining the Commission that Meta should never be allowed to merge with any company. Commissioner Wilson, the Commission’s sole Republican commissioner, challenged this refusal on due process and federal ethics grounds, detailing her concerns in a dissenting opinion. Her Democrat co- commissioners, however, “imposed heavy redactions” on her dissent, preventing the details from reaching the public. According to Commissioner Wilson, these redactions “served no purpose but to protect Ms. Khan from embarrassment.”
In addition to Chair Khan’s conduct in the Meta-Within merger, Commissioner Wilson recounted three other examples fueling her concerns:
the Commission’s issuance of a controversial November 2022 “antitrust enforcement policy statement asserting that the FTC could ignore decades of court rulings and condemn essentially any business conduct that three unelected commissioners find distasteful;”
the Commission’s launch in January 2023 of a rulemaking to ban under the FTC Act “nearly all non-compete clauses in employee contracts”–which, Commissioner Wilson argued, defied fresh Supreme Court precedent that “an agency can’t claim ‘to discover in a long- extant statute an unheralded power representing a transformative expansion in its regulatory authority;'” and,
the Commission’s apparently routine abuses of the merger review process to chill “all mergers, not only those that hinder competition.”
Given those allegations, Oversight Committee leaders have questions:
These matters raise questions whether the FTC under Chair Khan has become a rogue agency–particularly given Chair Khan’s drive at the beginning of her tenure to “bulldoz[e] procedural safeguards,” “consolidate agency power,” “unilaterally assert and expand regulatory authority,” and “abandon bipartisan and open processes.” We also are concerned whether departures from prior norms under Chair Khan are due to White House influence. President Biden, after all, called upon Chair Khan to play a leading role in implementation of his Executive Order 14036 on “Promoting Competition in the American Economy.”
Wilson’s allegations are serious and raise concerns that go well beyond policy wonk status. The burdensome regulations that are placed on corporations and the endless bureaucracy involved in mergers equal lower profits and lower dividends for investors, who might not all be the trust fund babies Khan might believe them to be. In addition, the uncertainty and the animosity Khan has created during her tenure lead to instability in the market, and to both investors and corporate executives acting in ways that might not be in their best financial interest – and that affects all of us.
It’s no surprise that Members of Congress want to investigate, but according to the MSM that investigation isn’t spurred by genuine concerns, but – you guessed – because of racism. Immediately after noting that partisan “cross-agency scrutiny” of regulatory agencies is routine – even though Congress has a duty and right to oversee said agencies – CNBC launches into the narrative:
But the 34-year-old Khan, the only woman of Asian descent to lead the FTC and the first person of color to head it in five years, finds herself at the center of a contentious tug-of-war between business and government in an era of social media takeovers and demands for more worker autonomy.
The London native born to Pakistani parents has said she and her family were “treated like potential terrorists” after they moved to the U.S. following the Sept. 11 attacks. Khan was only 11 years old.
But discrimination did not deter Khan. Her meteoric rise in the antitrust world began when she was a student at Yale University Law School, where her 2017 paper “Amazon’s Antitrust Paradox” led to more scrutiny of the e-commerce giant.
She had developed her passion for antitrust while working at the Open Markets Institute, a think tank based in Washington, D.C., that examines the effects of monopolies on economic competition and growth, according to a 2021 profile in The New Yorker.
Perhaps “discrimination” did not deter her because her parents were part of the elite class – a management consultant and an executive at Thomson Reuters, but I digress.
The remainder of the CNBC piece, published the day before Comer sent his letter, focused on Khan’s policy objectives as FTC Chair and that she’s defending herself against those terrible Republicans, who want to “pick apart” her “antitrust” actions now that they’re in charge, and that she’s defending those actions against “Republican backlash.” The only reference to Wilson’s allegations in the CNBC piece simply state that Wilson dissented from the rest of the panel’s views on various specific issues without noting that the other Republican nominee had already resigned, leaving Wilson as the sole person *to* dissent.
Fortunately, as long as Khan actually complies with Comer’s request, we will be able to see Wilson’s full dissenting opinion on matters that have come before the FTC since Khan took over, and be able to assess for ourselves the level of White House influence and if it crossed the line. But I’m not holding my breath.