Published August 26, 2021

Preet Bharara:

From CAFE and the Vox Media Podcast Network, welcome to Stay Tuned. I’m Preet Bharara.

Rebecca Kelly Slaughter:

We need to improve the antitrust laws to address lack of competition in all areas of the market. Ones that I find very compelling, eye glasses, contact lenses, beer. These are all deeply-concentrated industries that speak to real people. Cell phones is another one. Airlines. You can go basically across the economy and we don’t see that many truly competitive markets. And that is a big systemic problem.

Preet Bharara:

That’s Rebecca Kelly Slaughter. She has served as a commissioner on the Federal Trade Commission since May, 2018. And for the first half of this year, she was the acting chair. She previously served as chief counsel to Senator Chuck Schumer on the Senate Judiciary Committee, the same job that I held before becoming you U.S attorney. She also happens to be a good friend of mine.

Preet Bharara:

After nearly a decade, working for Senator Schumer. Becca was appointed to the FTC, which was established by President Woodrow Wilson in 1914, with the mission to protect consumers and to promote competition. Becca joins me today as the agency makes headlines for its aggressive enforcement of antitrust laws under the leadership of its new chair, Lina Khan, an outspoken critic of big tech.

Preet Bharara:

Just last week, the FTC revived his lawsuit against Facebook, alleging that the company’s acquisition of Instagram and WhatsApp created a moat around its monopoly in social networking. Becca and I discussed that lawsuit, the role of the FTC generally, and the Biden administration’s recent executive order intended to promote competition. That’s coming up. Stay tuned.

Preet Bharara:

Now let’s get to your questions. Hey, folks, in the last few weeks I’ve gotten a number of questions about issues relating to antitrust. In particular, there’ve been questions about the suit that the FTC, the Federal Trade Commission, filed against Facebook, and then refiled after it was dismissed a few weeks ago.

Preet Bharara:

Listener Jason Kent, for example, tweeted, “Thoughts on the revised Facebook lawsuit filed by the FTC last week, and whether you see it moving forward?” And I’ve also gotten questions about the executive order designed to increase competition that President Biden issued a few weeks ago. Well, it turns out that my guests this week, Rebecca Kelly Slaughter, is one of the nation’s most impressive experts on both of those issues. And we go into those topics in a good bit of depth.

Preet Bharara:

But I also want to share with you, folks, the fact that when I tweet out a request for questions for this portion of the show every week, usually I answer very serious questions, and usually there are about issues of law or policy, or democracy, or politics, but I do get a number, and this week is no exception, I do get a number of kind of outlandish questions, which I guess are designed to be funny and then I ignore. I will a couple of these again this week, but I thought I’d mentioned that to you, because I will confess they were a little bit funny.

Preet Bharara:

This question, for example, came from Twitter user @SaltedJosh, who wanted to know, how can I build a teleportation machine that allows me to bypass airports, but doesn’t turn me into a fly? #askpreet. So I’m going to pass on that one. Here’s another one. This is from Twitter user Dortexasperated/nastywoman#justiceforreality. And with a name like that, ad the handle like that, we are not going to be disappointed. The ask is, “Describe a vasectomy in detail and how much money it can potentially save?” I’m going to pass on that one, too.

Preet Bharara:

Here’s another, not so outlandish but random question that I think I will answer, although it’s very tough. This comes from @CizzlingSports on Twitter, Cizzling with a C, not an S. And Cizzle asks me the following, “Please rank the following three Nicolas Cage movies from one to three, with one being the highest.” And these are the films that are offered for my consideration and ranking; Face/Off, The Rock, and Honeymoon in Vegas. “Thanks in advance.”

Preet Bharara:

Aside from being someone who focuses on issues of law and policy, I’m a huge movie buff. I watch a lot of movies. I’ve watched each of these Nicolas Cage movies multiple times, probably more than single digits with respect to a couple of them. There is a lot to recommend each of these movies. Face/Off, for example, has a great director in the form of John Woo. It’s a little bit nutty. It’s not for everybody, but I think the combined performances of Nicholas Cage and his nemesis, John Travolta, who literally, as the name implies, trade faces, makes for a lot of fun. I’ve seen that movie a lot of times.

Preet Bharara:

The Rock is directed by Michael Bay, quintessential Michael Bay movie, and feel, and cinematography. Sean Connery in the movie that relates to an Escape from Alcatraz. In a fine, fine performance. Ed Harris, too. Kind of hard not to love that movie. And then of course, a completely different kind of movie, a comedy, Honeymoon in Vegas, with a tremendous performance by James Caan and a quite effecting Sarah Jessica Parker. There’s a scene in that movie, I don’t want to give it away if you haven’t seen it, where Nicholas Cage loses a hand in poker. And the times I’ve gone back and rewind the movie just to see the expression on Nicolas Cage’s face when he loses that poker hand.

Preet Bharara:

So, hard to rank, but I think I would put The Rock at number three. It’s pretty good, but there are other movies, Con Air and some others that Nicolas Cage’s stared in that I think are very good as well. Face/Off, for the sheer fun, I think I put it number two, but it’s very close with Honeymoon in Vegas. Because Honeymoon in Vegas, I think, stands out as a comedy, combined with a great performance of James Caan, I’m going to put that at number one.

Preet Bharara:

But I will say that I’m not sure why Cizzle picked these Nicolas Cage movies. There’s a lot of movies that were not presented to me for ranking. Among them, what I probably would rank as the best Nicholas Cage movie overall because the Coen Brothers film and funnier than Honeymoon in Vegas. And that’s of course the great, classic Raising Arizona, which I think I’ve seen dozens of times.

Preet Bharara:

And then of course you can’t leave off a different Vegas movie, Leaving Las Vegas. For which Nicolas Cage won the Oscar for best actor. Through other great movies, too, Lord of war, which is based a little bit on a case that my office oversaw. And then there’s a dark horse candidate that not everyone likes, but I have a particular fondness for. It doesn’t rise to the level of some of these other films, but I’ll leave you with this, the Nicholas Cage in Guarding Tess is pretty good. Thank you for the question, Cizzle.

Preet Bharara:

I hope that I will gain more followers than I will lose by acknowledging here that I happened to be a gigantic Nicolas Cage fan. A fact, which by the way, shocked some members of the CAFE team. Stay tuned. There’s more coming up after this.

Preet Bharara:

My guest this week is Rebecca Kelly Slaughter. She’s a commissioner on the Federal Trade Commission and an expert on antitrust issues. Rebecca Kelly Slaughter, welcome to the show.

Rebecca Kelly Slaughter:

Thanks. It’s great to be here.

Preet Bharara:

How are you?

Rebecca Kelly Slaughter:

I am good. I’m good. I feel like, in the pandemic, we always have to say, “Considering the circumstances, I’m exceptionally good.”

Preet Bharara:

You’re exceptionally good.

Preet Bharara:

Working from home.

Rebecca Kelly Slaughter:

Working from home. Everyone in my family is healthy.

Preet Bharara:

In the DC area.

Rebecca Kelly Slaughter:

In the DC area. Yes.

Preet Bharara:

So I’m going to go a little backwards with you. We have a lot of stuff to talk about in connection with your very important job on the Federal Trade Commission, explain to people what the hell that is, why we should care about antitrust regulation, and some lawsuits that you folks have brought. And I’m going to call you Becca like I’ve always known you. And so my first question is, is there any particular mentor in your life who has helped you in a particularly significant way in your career? Just random question I’m asking you.

Rebecca Kelly Slaughter:

Oh gee, that’s a hard one. I had some teachers who I really liked, but there was this one guy-

Preet Bharara:

Just read the thing I gave you.

Rebecca Kelly Slaughter:

I was going to say there was this one guy who got me to drop out of law school. And those are usually the people that you think of as the best mentors in your life. And I would put him right up there for exactly that reason.

Preet Bharara:

Who would get you to drop out of law school?

Rebecca Kelly Slaughter:

Who would do that?

Preet Bharara:

What were the circumstances of that?

Rebecca Kelly Slaughter:

Who would tell someone, don’t go back to law school, keep working for me?

Preet Bharara:

Not for good. My understanding about this person was just for a year.

Rebecca Kelly Slaughter:

Well, it wasn’t clear what the plan was at the beginning. It was just for a couple of weeks. And then it was for a semester. And then it turned into a year. That was you, Preet. You got me to drop out of law school.

Preet Bharara:

That was to me. I thought the story sounded familiar. So I should explained to folks, I usually put on the record if I have a prior working relationship with the guest. And this is kind of unique. I’ve never had someone who, many years ago, not to focus on how long we’ve been alive on the planet. I have been considerably longer than you. Fully 16 years ago, my first year working in the Senate on the Judiciary Committee for Senator Schumer. I arrived in January and an intern had been hired by my predecessor.

Preet Bharara:

And that intern showed up in the summer of 2005. By the way, at a very opportune moment, because it was in the summer of 2005, Sandra Day O’Connor retired and it would be up to the Senate Judiciary Committee to vet and approve or not approve whoever George Bush was going to appoint next. And it turned out to be John Roberts. So you show up as an intern. And I will say, and then we’ll put aside the flattery for a little bit, you performed so well even after only one year at law school where I understand they don’t really teach you much law, that Yale Law school place, that you were deemed so instrumental to the committee, to my work, to the senator’s work that, yeah, it’s true, we pulled some strings, or the senator to pull some strings, to get Yale, to allow Yale to not come back for a year so you could continue to work on the committee, both on that hearing.

Preet Bharara:

And then of course there was a second vacancy in the Supreme Court, right before Labor Day when Chief Justice Rehnquist passed away. And so those were some interesting times. I haven’t asked you this question, although, obviously, we’ve kept in touch for the entire time. Is there any memory of those times that still Sears you, that you can talk about, that won’t get you in trouble or me in trouble with Senator Schumer?

Rebecca Kelly Slaughter:

I mean, I have many, many memories of those times. Most of which would not get us in trouble, but I do frequently tell people the story, and I hope you will allow me to tell the story here, of when Chief Justice Rehnquist died. And it became clear that… We had thought that the confirmation process for Justice Roberts to fill Justice O’Connor seat would take like the first week of September or the second week of September.

Rebecca Kelly Slaughter:

So the plan was for me to go back to law school just a little bit late. And I think something we maybe don’t appreciate now because we’ve seen so many Supreme Court nominees in the last few years, is that at the time, like, the world stopped for the Supreme Court nomination. Because it was the first Supreme Court vacancy in 11 years.

Preet Bharara:

11 years. 1994. It had been the most constant court in generations, right?

Rebecca Kelly Slaughter:

Yeah. And it was Justice O’Connor. So it was totally game-changing. So it was already a big deal. And then I remember it was Labor Day weekend and I was not very cool. So I came home from whatever I was doing on that Saturday night as like 20-something in D.C. and turned on the news. Because this was also before we all had mobile news in our pockets all the time. And I’d been watching the news for like 15, 20 minutes when all of a sudden, coincidentally, the banner comes across that says the chief justice has died. And I thought, oh man. And I called you.

Preet Bharara:

You called me. I think it was in the 11:00 PM hour.

Rebecca Kelly Slaughter:

It was like 11:30 at night. And your first reaction was-

Preet Bharara:

Of Saturday night.

Rebecca Kelly Slaughter:

Mm-hmm (affirmative).

Preet Bharara:

My first reaction, oh, oh.

Rebecca Kelly Slaughter:

Why are you calling me? And I said, I’m sorry for bothering you so late, but I have to tell you. I just saw the news the chief justice just died. And then you used a lot of words that I won’t repeat right now. And you said, okay, I have to call the senator. I’ll call you right back. But also please don’t go back to law school. Or you’re not going back to law school or something like that.

Preet Bharara:

Did I make you the offer right then? I think I must have.

Rebecca Kelly Slaughter:

You said you have to not go back to law school. And I said, we can have a conversation in the morning that involves salary and how I’m going to pay rent and where I’m going to live.

Preet Bharara:

Clearly I was very persuasive. What I remember is-

Rebecca Kelly Slaughter:

You were.

Preet Bharara:

… it was a Saturday Labor Day weekend. We had worked around the clock studying, reading opinions, preparing a statement for the senator, preparing questions. I mean, it was a lot of grueling work. And the whole world was focused on this one event. And now you have two vacancies which have to be dealt with consecutively. And it was pretty late on Saturday night. And I call the senator who I think was away. And tell me, because I must have told you contemporaneously and tell me if my memory matched by what I told you, I call up. That’s a very groggy Chuck Schumer.

Preet Bharara:

And I can hear in the background his wife, Iris, getting sort of annoyed and exclaiming who the hell, it might’ve been a stronger word than hell, is calling at this hour. And I said to the senator, there’s been a major development. Obviously, he was important member of the Judiciary Committee. And I told him what you told me that Rehnquist had passed. And I was waiting for what he would say. And do you remember what I told you he said his reaction was simply, “Oh boy. Oh boy.”

Rebecca Kelly Slaughter:

Yeah. It was something like that.

Preet Bharara:

Yeah. And then began… Actually we had two and a half Supreme Court confirmation battles. It was Roberts, but in between Roberts and Alito, people forget George Bush’s-

Rebecca Kelly Slaughter:

Ill-fated nomination.

Preet Bharara:

… Harriet Myers, which didn’t go very well. And was withdrawn.

Rebecca Kelly Slaughter:

Yes. But it went far enough that we spent a lot of time reviewing a lot of documents. So we invested a lot of time in that, even if it didn’t actually make it to the hearing, which was probably fine for everyone.

Preet Bharara:

And interesting part of that process. And we could spend the whole time talking about the Supreme Court in the confirmation process. And it was quite a different Joe Biden during that process than we see as president of the United States now. But we spent a considerable amount of time with the nominees, with Roberts, then with Harriet Myers, and then with Sam Alito. And the Senator asked a lot of questions in those preliminary meetings, which gave a sense of how they would be at the hearings and the hearings themselves. Very brutal. Do you have either a memory from that time that sticks with you and/or in the subsequent confirmation hearings of which there have been many now in the succeeding decade and change? Do you think about the modern hearings in a way that’s different because you had that experience?

Rebecca Kelly Slaughter:

Yeah. Well, I mean, I actually also worked on.

Preet Bharara:

Well, yes. I should… As people will have heard in the intro, you came back and you took my old job at a much younger age. So yeah, you worked on multiple Supreme Court hearings as well.

Rebecca Kelly Slaughter:

Yeah. So I worked on every Supreme Court hearing between Roberts and Gorsuch. So I saw the entire evolution of them and also the evolution of the sort of climate on the Hill over that period of time between 2005 and 2018. And I think the Supreme Court hearings, the tenor of them change the way the tenor of a lot of things on the Hill changed over that period of time.

Preet Bharara:

They were considered to be pretty bad back in ’06. And you’re saying it’s gotten worse?

Rebecca Kelly Slaughter:

Yes. I think it has gotten dramatically worse, much more vitriolic, much more vicious, really, was sort of the feeling. I think when we went through the Roberts hearing, there were sort of a sense of good faith inquiry into a nominee’s views. And then my cynical view is that it became clear quite quickly that no nominee was going to tell you his or her views at a hearing. Then it became… It shifted into more of a opposing party tried to expose a nominee rather than probe for views.

Rebecca Kelly Slaughter:

There was a very good metaphor, if I recall correctly, a couple of good metaphors in Senator Schumer’s opening speeches from the Roberts hearings about icebergs and how much you see versus what’s underneath. And also when you ask a nominee if they like a movie and they just answer, I like comedies but won’t tell you what comedies. And that it just becomes this elaborate dance that is a little bit exhausting and very frustrating.

Rebecca Kelly Slaughter:

So it was not my favorite thing to work on, I will be honest with you. On either side of the nominations process, either supporting or opposing a nominee. Because it was a lot of hard work that felt very theatrical, maybe is the right word, and where the outcome was almost always entirely predetermined. And that was the part that was frustrating to me. So it was hard. And I really admire the good work of the people who put the time and effort into those confirmation hearings, again, on all sides.

Preet Bharara:

So you’re now on the Federal Trade Commission?

Rebecca Kelly Slaughter:

I am.

Preet Bharara:

What the heck is that?

Rebecca Kelly Slaughter:

What is the Federal Trade Commission? The Federal Trade Commission is an independent federal agency. So let’s pause on what that means. That means it is technically part of the executive branch, but it operates independently. And instead of being governed by a single head like a secretary of a cabinet department, it is governed by five commissioners. And by statute of five commissioners, three from a majority party and two from the minority party. By a tradition, although not by statute, the majority is the party of the president and the minority is the opposing party. So I was appointed in 2018 as a minority commissioner, is one of the Democratic appointees. And there were three Republicans at the time. We currently have three Democrats and there are two Republicans. That’s how we’re constituted.

Preet Bharara:

Appointed by the president?

Rebecca Kelly Slaughter:

Appointed by the president, nominated by the president, confirmed by the Senate.

Preet Bharara:

And then as you serve… Answer this question for folks. Does each commissioner then serve at the pleasure of the president? Can the president fire commissioners or fire the chair at his will?

Rebecca Kelly Slaughter:

Complicated question, not recently tested.

Preet Bharara:

That’s why I’m asking you.

Rebecca Kelly Slaughter:

Complicated question, not recently tested.

Preet Bharara:

You finished Yale, right? So you should know the answers to these.

Rebecca Kelly Slaughter:

No, I thought we discussed that we didn’t actually learn a lot of law at Yale. I studied for the bar, but this was not on the bar exam.

Preet Bharara:

I think the ambitious people of Yale spent some time thinking about presidential appointments.

Rebecca Kelly Slaughter:

That is very true. The conventional wisdom in the historical precedent is that no commissioners can only be fired for cause during the duration of their tenure, but there are some folks under a unitary executive theory of government who have challenged that notion and suggested that any executive appointee must necessarily serve at the pleasure of the president. And so I expect we will see more challenges to that, but for now, the legal precedent and our understanding is that commissioners, during the duration of their Senate confirmed term, can only be fired for cause.

Preet Bharara:

Well, let’s hope that goes and get tested in the immediate future. So we’re going to talk a bunch about antitrust trust and competition policy. And I know that that’s part of the remit of the FTC. First, talk about the stuff that does not relate to antitrust that is part of the work of your agency.

Rebecca Kelly Slaughter:

Well, that’s what I was going to say. I got to how the agency is constituted, but not what we do. And people ask me all the time, oh, the Federal Trade Commission, you do all that international trade stuff. No, we do not.

Preet Bharara:

That’s not you.

Rebecca Kelly Slaughter:

We do not do international trade at all. Trade in the name of the Federal Trade Commission refers more to commerce, generally, domestic commerce. And so the Federal Trade Commission was formed in 1914 with the passage of the Federal Trade Commission Act. And the Federal Trade Commission Act sets up two main prohibitions in law that the Federal Trade Commission enforces. The first is a prohibition against unfair and deceptive acts and practices. And that’s what we think of as our core consumer protection mission. And the second is a prohibition against unfair methods of competition. And that’s what we think of as our core antitrust mission.

Rebecca Kelly Slaughter:

So, generally, the FTC is divided into two mission areas, consumer protection and competition. And consumer protection is enforcement against, like I said, unfair and deceptive acts and practices. That is a very broad term that encompasses all manner of, basically, civilly illegal conduct. Some of which may also be criminally illegal.

Preet Bharara:

What’s a good example of that?

Rebecca Kelly Slaughter:

So it is everything from fraud. So I’ll name some cases. We brought a case against the University of Phoenix, so for-profit university, for defrauding students by misrepresenting the opportunities that they would get. We’ve brought cases against multi-level marketers for misrepresenting income opportunities. We bring cases…

Rebecca Kelly Slaughter:

So we have fraud. We have… Basically, the entirety of the nation’s privacy enforcement agenda is housed in the FTC right now. So you may have heard about that time the FTC got $5 billion from Facebook that was over a privacy violation, brought under section five of the FTC Act. We also enforce some sector-specific laws like the Children’s Online Privacy Protection Act COPPA. And we use that to bring a case against Google and YouTube for violating children’s privacy. So that also operates within consumer protection.

Rebecca Kelly Slaughter:

It’s a huge economy wide range of conduct that we deal with, which is… It’s a massive mission just on the consumer protection side.

Preet Bharara:

So you need like 30, 40,000 staff members?

Rebecca Kelly Slaughter:

That’s about what we need.

Preet Bharara:

How much you got for all that work?

Rebecca Kelly Slaughter:

Not that many. Something that is, I think a really important thing to understand about the FTC is that it has been systematically underfunded for the last four decades. We had about 50% more staff at the beginning of the Reagan administration than we do today. And when you think about the scope of the economy, the kinds of activity that we enforce against in 1980 versus now, you can imagine how much it has grown. Online privacy was not a thing in 1980, for example.

Rebecca Kelly Slaughter:

So it’s a huge mission. We have about 1100 employees now, maybe closer to 1200. That’s not that many. By contrast, in the UK, the data protection authority in the UK has 700 people just doing data privacy. And the UK is a much smaller jurisdiction than ours is. So I think we are substantially underfunded and outmatched. And that’s without even touching the antitrust side.

Preet Bharara:

So now let’s talk about the antitrust side. What’s the mission of the FTC with respect to that area?

Rebecca Kelly Slaughter:

So the short version of the mission is to protect against unfair methods of competition. And we sort of break that down into two different buckets, illegal mergers and acquisitions and illegal anti-competitive conduct.

Preet Bharara:

So there’s some confusion here. And I was U.S attorney for a number of years, and part of the Department of Justice for a lot of years, and did a lot of work with the FTC. Sometimes we would get referrals. The one area that we did not engage in, U.S attorneys tend not to engage in is antitrust. So the question I have and the confusion I’ve had for many years, which you have promised you were going to explain to me and to the audience, there is another government agency that deals with anti-competitive issues and antitrust, and that is the aptly named antitrust division of the Department of Justice.

Preet Bharara:

And you’ll read in the paper, there’s a proposed merger. And sometimes the FTC will be examining and investigating and coming to the conclusion over the merger. And sometimes it’s the antitrust division of the Department of Justice. Who does which, and why?

Rebecca Kelly Slaughter:

Well, there are a couple of hard rules about who does which. So the FTC has excluded from its jurisdiction a couple of particular areas of the law. So banks are excluded from FTC jurisdiction common carriers. So think like railroads or airlines, things like that. Those will go to DOJ. And that’s pretty easy to figure out. The rest of them, there isn’t a hard line rule about who does it. We have to decide between the two agencies.

Preet Bharara:

Is it rock paper scissors? Or is it flip of a coin?

Rebecca Kelly Slaughter:

Sometimes I think rock paper scissors might be more efficient.

Preet Bharara:

Or is it pushups?

Rebecca Kelly Slaughter:

It’s definitely pushups. A hundred percent. The principle that should and does govern, is supposed to govern that decision-making, is which agency has more expertise in a particular area. And you want the agency with the most expertise in the market to be doing the investigation.

Preet Bharara:

But there’s no arbiter, right? You’re separate, as you pointed out, separate independent agencies.

Rebecca Kelly Slaughter:

There’s no arbiter. And this is something that boggled my mind when I got to the FTC. The poor staff in our bureau of competition, I must’ve had them sit down with me 10 times and I would have the following conversation with them. The decision over which agency gets to review which matter is called clearance. That’s just the term of art that’s used for which agency has a matter cleared to it.

Preet Bharara:

So you kind of duke it out? You duke it out, right?

Rebecca Kelly Slaughter:

Yeah. We want to matter.

Preet Bharara:

So what is pushup?

Rebecca Kelly Slaughter:

The DOJ wants a matter. Who gets it? Well, we negotiate. Okay. Let’s imagine we can’t decide. Who gets it? Well, we have to decide. Okay. But then who gets it?

Preet Bharara:

You are clarifying this in a tremendous way. So let me ask you an example. This is before your time. So, Facebook, we’re going to talk about Facebook because you guys have a lawsuit. And now an amended lawsuit against Facebook. Facebook chooses to buy Instagram. Do you have an understanding, I know it was before your time, but do you have an understanding as to how it was decided? Who would examine that acquisition?

Rebecca Kelly Slaughter:

Yeah. So in… I’m going to tread carefully around a particular case, because as you mentioned, there is litigation. But in general, in any acquisition, both agencies, so with mergers over a certain dollar value, the parties file what’s called a Hart-Scott-Rodino notification to tell the agencies that they are intending to merge. And then the agencies have 30 days to say, we want to look into this more, or we’re not going to look into this more.

Rebecca Kelly Slaughter:

And as an aside, I have a big pet peeve about people saying that agencies clear mergers. We do not ever clear a merger. We never say, affirmatively, this merger is good to go. We can choose to challenge a merger or choose not to challenge a merger, but we never give an affirmative green light. And that’s important because of the resource constraints that I mentioned earlier. We don’t have the resources to investigate and challenge nearly a fraction of the mergers that I would want to. So it’s important to note that we’re not doing that.

Rebecca Kelly Slaughter:

Okay. But a filing comes in and both agencies get the filing and look at it. And each can decide, is this something we want to look at further? And if it’s in a market, let me use hospitals as an example, because hospitals is one where the FTC has very substantial expertise. When hospital mergers are filed, the FTC is likely to say, “Hey, DOJ, we want to take a look at this.” And DOJ is likely to say, “Cool. You have a lot of experience in hospitals. You go for it.”

Rebecca Kelly Slaughter:

It becomes more complicated if, what if an insurance company is buying a hospital network and DOJ has substantial experience with insurance companies, but the FTC has substantial experience with hospitals. Then who should get it/ And that’s where you get into this stupid discussion and negotiation.

Rebecca Kelly Slaughter:

Now I will say clearance usually works itself out well with mergers, because if someone doesn’t open an investigation within 30 days, the merger can close. And so the government is incentivized to get to a conclusion quickly. Where I have real concern about the clearance processes in conduct matters, which is where we’re investigating, not a merger, but anti-competitive conduct by a company. If an investigation doesn’t open then, there’s deadline. There’s no organic deadline. We can sit in a clearance debate with DOJ for a year and no one will be investigating that conduct. And I think that is a really big problem.

Preet Bharara:

That seems bad. Now how you propose to fix that?

Rebecca Kelly Slaughter:

It is very bad. I would propose to fix it by saying-

Preet Bharara:

I knew you would have it. So what’s the fix and why can’t it be accomplished.

Rebecca Kelly Slaughter:

I think in a conduct manner… Well, let me give you an analogy. We also have overlapping jurisdiction with the Consumer Financial Protection Bureau in a lot of our financial practices matters, consumer protection fraud cases that are in the financial space. Some of them could be enforced by CFPB. Some of them could be enforced by FTC.

Rebecca Kelly Slaughter:

And the way it generally works there is basically a dibs system. Whichever agency sees the conduct first and wants to investigate, sort of gets to call dibs on it. And the other agency doesn’t tend to stand in their way when there is a good faith reason. Say, CFPB wants to investigate something and the FTC already has a related investigation going on, we might say, “Hey, CFPB, do you mind if we take this case because it’s related to what we already have?” And they generally say, okay. I think the dibs model is not bad for conduct. I think it’s not a bad idea.

Preet Bharara:

It encourages speed. I mean, it’s a little bit of how it’s done at DOJ and with the respect of the various U.S. attorney’s offices.

Rebecca Kelly Slaughter:

Yeah. No, I will say this process has, at different times in history, worked very well and worked very poorly. Over the last administration, I think it is not a secret that the relationship between DOJ and the FTC was not stellar. There was a lot more conflict, a lot more divergence of approach, and a lot more fights about clearance. I know this DOJ and this administration is pretty committed to working well with us, allocating resources efficiently, acting like the enforcement partners that we both should be and are.

Rebecca Kelly Slaughter:

And so right now I think clearance is working generally pretty well. And this isn’t really a big issue. It’s only a problem when you are in a space where you don’t have agencies that are getting along well. And it’s only really a problem if you are sort of pro enforcement, as I am, if that lack of cooperation leads to sort of a deadlock and a dead end in enforcement. And what’s really concerning to me.

Preet Bharara:

My conversation with Rebecca Kelly Slaughter continues to this.

Preet Bharara:

So let’s talk about the essence of antitrust enforcement and the philosophy of it. People will understand that if a bunch of retailers or other businesses got together and colluded as to price so that they could all maintain a certain degree of revenue and profitability, that violates certain anti-trust provisions. And that seems like something that everybody would be against, probably on all sides of the aisle.

Preet Bharara:

There has been in recent times debate over enforcement actions, particularly when it comes to big tech. And the question arises, is the focus consumer welfare? Is the focus competitiveness? Is the focus price? Because, depending on what the focus is, the enforcement decisions will change. Right? And so what should be the proper focus? And should that be changing over time?

Rebecca Kelly Slaughter:

I think to answer that question, you want to go back to what is the focus of the statutes that you are enforcing? What is the core purpose of the statute you’re enforcing? Because you could talk about this as a philosophical matter, what should be the focus? And then you can talk about it as a statutory matter, what did the statutes tell us are the prohibitions? And then you can talk about it as a jurisprudential matter, how of the court-

Preet Bharara:

Yeah, let’s do it that way. And also just at the outset, remind people, and we had Amy Klobuchar on the show talking about her really great book on some of these subjects, these statutes are quite old. They’re not recent statutes, right?

Rebecca Kelly Slaughter:

That’s right. 1890 was the Sherman Act. So it is 131 years old. But there are reasons that old statutes can endure if they are applied in a way that continues to make sense. So sometimes the problem that people have with antitrust law isn’t necessarily the statutes themselves, but how courts have interpreted them over time. That can get away from the original purpose. It can also be the case, and these are not mutually exclusive things, that the original purpose is too narrow or in opposite for markets that couldn’t have been conceived of in 1890.

Preet Bharara:

So you were going to answer the question either based on jurisprudence or common sense or the statutes themselves, what is the focus? What is the harm that is trying to be prevented? And what is the good that is trying to be done?

Rebecca Kelly Slaughter:

So I think it starts… I think the best way to answer this question starts with thinking about what do we want our markets to look like? We want our markets to be competitive. What does that mean? We want markets to be ones in which firms win, they get ahead, winning customers, recruiting employees, by providing the best value for their product, or they recruit employees by providing the best conditions of employment. And that’s value either as in labor matter or as a product matter. It’s not just a matter of price. It’s a matter of price. It’s a matter of quality. It’s a matter of innovation. It’s a matter of opportunity.

Rebecca Kelly Slaughter:

So in a market that has perfect competitive conditions, if you have a firm producing some good and it starts raising the price beyond its cost to produce it or degrading the quality of the product, you would imagine that another firm would see an opportunity and say, “Hey, I’m going to come in and win your customers away by providing a better value proposition for best product.”

Preet Bharara:

That’s the free market. Yay.

Rebecca Kelly Slaughter:

Free market. That’s how you want the free market to work. Right? So then customers would shift to the competitors. The original firm would be incentivized to keep the value proposition high, improving the quality, innovating, lowering the price. When you have a firm that can lower that value proposition, either raise prices, degrade quality, limit innovation, without a competitor interfering, that is an indication of what we call market power. The power to basically harm customers without competitive interference.

Rebecca Kelly Slaughter:

And antitrust laws make it illegal to willfully acquire or maintain monopoly power through methods other than competition on the merits. What we want to see is firms competing on the merits. And where we get concerned is if they’re not competing on the merits and are instead able to increase their profit at the expense of their consumers, or also at the expense of their employees.

Preet Bharara:

We hear a lot of talk about companies getting too big, especially big tech. And so I feel like in the common debate that happens on the internet, interestingly and ironically enough. And in other places, people talk about size. And the size itself is bad. Facebook is too big. Amazon is too big. These other companies are too big, but it’s not a question of size. Size itself is not the issue. Am I right?

Rebecca Kelly Slaughter:

Sort of. I think there is sort of a maxim that big is not bad. But I think that discounts the fact that size can lead to the ability to exercise market power to the detriment of either consumers or employers or other input producers because of barriers to entry for a potential competitor coming in and creating similar scale. And that’s where you see digital markets becoming a really key part of the conversation because of this term that everybody throws around, network effects.

Rebecca Kelly Slaughter:

But network effects basically just means that the more you have the more you get. The more users you have, the more people want to be on your network. And it’s very, very hard to replicate that scale as a competitor. So that is a way to create an environment where you don’t have to compete as much on the merits as you do by building a moat around yourself. So I think the concept that just big as bad is a little bit announced. It’s not wrong, but I think we have to be really careful to understand both how a company got big and how it’s staying big, because those two questions are the things that we need to be concerned about.

Preet Bharara:

How do you think about consumer welfare and these issues that you’ve raised when it comes to a company like Facebook? And we’ll get the lawsuit in a moment. I know that you need to be careful about how you’re talking about it. So, obviously, only what’s in the public record you should address. But Facebook is a company that, depending on who you are and depending on what you should make of it, there are probably hundreds of millions of people who think that their welfare is increased by their service. They didn’t have it before you.

Preet Bharara:

And I might think that people are not well-served by it and you and I might not be frequent users of Facebook, but a lot of people are, number one. And number two, they don’t really charge a price for anything. So it’s not the traditional kind of price collusion type of anti-trust matter that people think about historically. What’s the consumer welfare issue when it comes to Facebook generally? And then can you describe why it is that the FTC has sued that company?

Rebecca Kelly Slaughter:

So I think everybody, we all in the antitrust universe sort of get twisted in knots talking about and debating about consumer welfare. Is it the right standard? What does it actually mean? People have different views about it, both historically and as implemented. Where did it even come from? It’s not in the statute. So I tried to just not get into that because I don’t think it’s the right question. I think the question goes back to-

Preet Bharara:

Not because you don’t care about it, you just think it’s not the right question.

Rebecca Kelly Slaughter:

I don’t think it’s the right question because I think it’s using a term that means very different things to very different people. And to some people, it really means a single-minded focus on price. And I don’t think that that is at all what the laws should be concerned with. I think the point that I was making earlier about value proposition means not just price. It means quality, innovation, access. And so when you see digital markets that are, and I’m doing air quotes that you can’t see here, free to consumers-

Preet Bharara:

Those are my favorite kind, the ones that you can’t see.

Rebecca Kelly Slaughter:

The ones you can see. Digital markets that are, I will use an actual word, nominally free to consumers. There are folks who say you can’t even have an antitrust conversation because there is no price here. The way I think price plays a role in this is that price makes things easier to measure. So antitrust cases that involve the raising of prices can be easier to show because you can measure price.

Preet Bharara:

It’s quantifiable, because… I’m sorry. Some of these other things that you talk about, like whether innovation is being stifled, well, how on earth do you measure?

Rebecca Kelly Slaughter:

Right. I think that’s exactly why price is an attractive metric if it’s available. But the fact that it’s not always available doesn’t mean that there isn’t a problem there. And so the other things about which we, as antitrust enforcers, are concerned include quality innovation, access, choice.

Rebecca Kelly Slaughter:

And so, one of the things that the amended complaint that the FTC filed against Facebook last week talks about is an example of direct evidence of Facebook’s market power. Being that after the Cambridge Analytica scandal, which, parenthetically, was what led to that $5 billion settlement with Facebook on the consumer protection side of the FTC. Users reported widespread dissatisfaction and disappointment with the service. And yet they didn’t switch away. And the fact that users weren’t switching away or stopping it shows an inelasticity of demand that suggests that Facebook has market power.

Rebecca Kelly Slaughter:

Now, someone else might say that just shows they don’t care that much. People don’t care that much about privacy, but… And this is what some folks refer to as the privacy paradox that people report not being happy with privacy metrics, but they don’t do anything to change their behavior. I have a lot of skepticism that that reflects the fact that people don’t actually care about their privacy. I think it reflects the fact that they don’t have a lot of other choices.

Rebecca Kelly Slaughter:

And so what we want is a universe where companies are competing on quality metrics like, for example, privacy. And where if folks were dissatisfied with Facebook’s privacy offerings, they could switch to a more privacy-protective service. That’s just a hypothetical example, but one that sort of comes from the complaint.

Rebecca Kelly Slaughter:

The other thing we want to be able to see is new entrance coming in, differentiating their products, creating innovative tools for the market. And part of what the FTC has alleged and its complaint against Facebook is that Facebook engaged in a concerted strategy to keep that from happening by buying all potential competitors and either absorbing them into Facebook itself as in the case of Instagram and WhatsApp, or burying them by shutting down the services, in the case of a whole bunch of smaller companies that are documented in the complaint.

Rebecca Kelly Slaughter:

So the reason this is a concern for enforcers is, as I said earlier, we want markets where someone can come in and offer a better value proposition, a new idea. And we don’t want markets that are controlled by a large company that keeps that access to quality and innovation and choice from users.

Preet Bharara:

Can I ask a dumb question? Is the purchase that you described, the purchases of WhatsApp and Instagram, is that part of the complaint, the current complaint against Facebook?

Rebecca Kelly Slaughter:

Those are. The current complaint-

Preet Bharara:

But can I ask, how can that be…. What’s the propriety of that? For lay people to understand, what’s the propriety of that given that the FTC existed at the time that those acquisitions took place didn’t take action? How do you shoehorn those things into a current complaint when prior regulators didn’t see a problem?

Rebecca Kelly Slaughter:

I don’t think that’s a dumb question at all. And also, I will tell you one of the things I will put in an aside the lessons learned from my time with Senator Schumer and working for you. One of the best lessons I learned in that time was to always ask the most basic questions and never to pretend one understand something, that one doesn’t because-

Preet Bharara:

Well, because my experience is many times people can’t answer the basic question.

Rebecca Kelly Slaughter:

Yeah, exactly. So it is a good question. And what you’re referring to is the fact that both the Instagram and WhatsApp acquisitions were filed with the FTC. That process that I talked about earlier about HSR notification were filed with the FTC at the time and the FTC chose not to bring enforcement actions against them. This is in part why I made that point earlier about the FTC doesn’t bless mergers or clear them. It chooses not to.

Preet Bharara:

Shouldn’t a company have some repose once that’s happened?

Rebecca Kelly Slaughter:

Yeah. It’s certainly an argument that people have made, but that’s not what the law says. And in fact, in his original motion to dismiss decision. So for procedural history, the FTC filed this complaint originally in December of 2020 on a bipartisan basis. Interestingly, the Republican chair at the time voted with myself and the other Democratic commissioner to file the complaint. And Facebook filed a motion to dismiss. And the judge, in late June, granted that motion to dismiss and gave the FTC leave to refile.

Preet Bharara:

Which means write more words, write more. And you guys did.

Rebecca Kelly Slaughter:

It was a very show-your-work decision. Not on this point, though. Because on this point the judge said the FTC was totally within its rights, that the law prohibits illegal combinations in restraint of trade. And it doesn’t put a time limit on it. And it doesn’t end that after a period of time.

Rebecca Kelly Slaughter:

One of my Republican colleagues has written that, as a prudential matter, she doesn’t think it’s a good idea for the FTC to go back after a merger has been reviewed and challenge it. But I don’t actually agree with that because of all of the resourcing issues that I talked about and also evidentiary issues. We may not know at the time of a merger just how anti-competitive it is. Nor may we be able to develop the evidence that we would need to make it worthwhile to go into court and challenge it.

Rebecca Kelly Slaughter:

Should we be doing that more? Absolutely. Do I wish we had done it at the time in these mergers? Sure. But just because we didn’t doesn’t mean we shouldn’t go back and fix a problem now. And I think that that is just a really important core principle for enforcers, civil criminal across the board. We should always be willing to fix problems that we see, whether they are of our own making or not.

Preet Bharara:

Part of the problem, it seems to me, and clearly seem to the judge, is that the way antitrust law is written. You don’t just say this company is being anti-competitive. There there’s some rigor that has to be applied to that kind of an allegation. And among the areas where you have to be rigorous is you have to show what the actual market is. So if you make shoes, is it the shoe market? Is it the subcategory of sneaker market? What’s the place in which someone is being monopolistic or engaging in anti-competitive behavior, as I understand antitrust law, right?

Preet Bharara:

And with these new companies, tech companies, tell me if this is correct, it’s not as easy as with a shoe company that puts stuff that you wear on your feet, to figure out what is the proper definition of the market. I take it from the FTC’s complaint that defines the market in which Facebook has engaged in bad conduct according to the complaint. The market is personal social networking services. Can you explain what that is? And then who else is in that market? Because, as I learned from doing an interest work very, very long time ago in the early stages of my legal career, the question of whether or not someone has undue market share or not sometimes hinges almost completely on how you define the market, right?

Rebecca Kelly Slaughter:

Yeah. That’s exactly right. Most antitrust cases rise and fall on market definition. So it’s a huge, extensive, expensive, complicated process to wriggle through. In this case, the way the FTC has defined the market for personal, social, and networking services is that they have three main features. They’re built on a social graph that maps the connections between users and their family, friends, and other personal connections. It has features that users employ to interact with those connections such as like one-to-many broadcasts or sharing of news, photos, and videos. And third, it has features to find and connect with other users in order to build and expand those personal connections.

Rebecca Kelly Slaughter:

So the way Facebook… I mean, the way the FTC talks about the market today is that it basically includes Facebook, Instagram, and Snap. And we talk about a lot of other potential competitors that could have come up that were stifled over the course of what we alleged to be Facebook’s illegal course of dealing. And say that the market doesn’t include other services like LinkedIn, which is just for professional connections. Or Twitter, which isn’t about personal connections as much and is more about broadcasting to the world. Or Reddit, which is more about finding users with shared interests.

Rebecca Kelly Slaughter:

So that is how the FTC has laid out the market definition. And I will note that the judge didn’t reject our market definition. He said that it was a plausible market. He just wanted us to show evidence of Facebook’s market power within that market.

Preet Bharara:

And you allege that within that market, it’s about 60%. Is that correct?

Rebecca Kelly Slaughter:

The way the allegation was constituted in the original complaint. And what the judge said is just saying 60% isn’t enough. You need to show us how you got to that. And so in the revised complaint, the FTC uses a whole variety of metrics, including time spent, daily active users, monthly active users. And shows how, from Facebook’s own ordinary course documents, that this was the market that they understood themselves to be in.

Rebecca Kelly Slaughter:

And so that’s an important part of the calculus, too. People are always going to quibble over market definition, whether it’s external, commentators, or defendants. And as you indicated, it is where a huge amount of antitrust litigation is fought. But I think that the agency has done a good job outlining why this definition of a market makes sense based on the actual facts in the investigation.

Preet Bharara:

Is there a little bit… Again, my recollection of antitrust law goes back many, many years. So it’s foggy. Is there a little bit of a catch 22? Because it occurs to me that one way that you can fairly figure out what the market is, whether it’s a sneaker market within a larger shoe market or footwear market versus whatever the market is you declare that Facebook is a part of, how the company itself, and what would be an admission against interest, I guess how that company itself thinks of its market.

Preet Bharara:

And companies are very, very shrewd, particularly ones that are worth a trillion dollars. One would argue are very keen on understanding who their competitors are. And there would be documents and communications within the company that indicate their own understanding of what kind of market they’re in and how you would define it and who the competitors are. But you can’t get that stuff until you’ve proceeded along far enough with the complaint without it getting dismissed. Am I asking a coherent question?

Rebecca Kelly Slaughter:

Yeah. I think it is a really good question. I don’t think it’s one that’s particularly apropos for this case. Because in the FTC’s case, we did a very extensive investigation where we got a lot of those documents, those internal documents from Facebook before we filed a complaint, and a lot of them are cited in the complaint. But this is a really big problem for, for example, private antitrust plaintiffs or where you have companies that are really not cooperative with your investigations. And honestly, companies don’t have a lot of incentive to be cooperative for investigations.

Rebecca Kelly Slaughter:

So this is… I think this becomes a real problem. And this is true, not just in antitrust law. This is true in the lots of civil litigation where you have the problem in a universe of particularized pleading requirements, where in order to plead a case to survive a motion to dismiss, a plaintiff needs to have information that it can’t get until it survives a motion to dismiss. That’s the question that you were asking. And I think it is absolutely a problem in a lot of cases, although not this particular case.

Preet Bharara:

Right. Because you have the ability to get information in advance of filing the company.

Rebecca Kelly Slaughter:

And part of that is because we are a government agency with subpoena power. So we have what a lot of private litigants do not have.

Preet Bharara:

Here’s another dumb question. So, probably if you’re a lay person, you here, I don’t mean to pick on Facebook alone, but you hear the big tech companies, but since we’re talking about Facebook, I’ll mention it again, they get attacked from the right and the left, both with respect to whether viewpoints are being suppressed or not, whether they are too big or not, whether they’re dealing properly with private people’s data or not. And so it seems like a bi-partisan gang up on Google, on Facebook, and various platforms. And yet, and I know they’re not the same thing, and yet the vote with respect to proceeding with an enforcement action against Facebook on your commission was three to two, along partisan lines.

Rebecca Kelly Slaughter:

So again, here I want to be careful just to reflect what’s in the public record. And my colleague, Commissioner Wilson, shared her policy view that we shouldn’t go back after we had already reviewed a merger to challenge it. I think in general, you are taking a step away from this particular case and thinking about antitrust law more generally.

Rebecca Kelly Slaughter:

While you are absolutely correct that there’s an enormous amount of human cry on both sides of the aisle about the power of big tech, I don’t think that necessarily extends to a shared bi-partisan or overlap in the bi-partisan concern about market power and the particular role of antitrust law with respect to big pack. And it doesn’t necessarily apply to shared views of solutions.

Rebecca Kelly Slaughter:

Now, counterpoint, the House Judiciary Committee has been involved in a very extensive investigation into the market power of big tech and has proposed a number of bills to change the antitrust laws, to make them better suited to address these kinds of market power issues and antitrust issues that are 1890 statute maybe isn’t reaching, at least as interpreted by courts recently. And those had at least a bi-partisan patina. And that is an important thing, but you still saw a lot of partisan breakdown about it.

Rebecca Kelly Slaughter:

I mean, I think at the end of the day, a lot of antitrust law from a partisan perspective comes back to some real basic differences in philosophy between the parties, which is how much government interference in markets should there be. And Republicans tend to want less government interference in markets and Democrats tend to be comfortable with more.

Preet Bharara:

Unless it’s about masks or vaccines.

Rebecca Kelly Slaughter:

Yes. But then the government should be telling us exactly what to do, but not to use the masks or vaccines only to not use them.

Preet Bharara:

There was a big deal announcement made by the White House not that long ago, big executive order relating to issues of competition.

President Biden:

To keep our country moving, we had to take another step as well. And I know you’re all tired of hearing me during the campaign, and since I’m elected president, talk about it. And that’s bringing fair competition back to the economy. That’s why today I’m going to be signing, shortly, in the executive order promoting competition.

Preet Bharara:

I would trust that you had some involvement in that. My recollection from the old days back when we worked in the Senate was that to try to accomplish major things by executive order was something that we criticized the Bush administration for. Explain why this was okay and if it actually has any teeth.

Rebecca Kelly Slaughter:

Well, accomplishing things by executive order that are illegal is absolutely-

Preet Bharara:

Such a good answer.

Rebecca Kelly Slaughter:

… an appropriate subject of criticism. Using the power of the executive to appropriately govern, set worth policy, and describe administration philosophy is a great thing to do. And an important thing to do.

Preet Bharara:

I was doing my Fox News impersonator to try to ask a gotcha question. We’ll handle it.

Rebecca Kelly Slaughter:

I don’t think you got me on that one. I think this executive order is so important and such a major accomplishment for this administration. And I think it tells a really compelling narrative about why we should care about competition and why competition seeps into all aspects of the government and the economy. I mean, I really think that the White House, Tim Wu, the folks who worked on it, deserve enormous credit for it.

Rebecca Kelly Slaughter:

And one of the things that I really love about it is it focuses particularly on workers. Because Americans experience competition questions from multiple angles. They experience it as consumers of goods that are produced by consolidated markets, but they also experience it as employees who may not have the ability to bargain fairly for their wages or compensation because they don’t have as much mobility as we would like either because of a lack of competition among employers or because of anti-competitive terms like non-compete clauses in employment agreements.

Rebecca Kelly Slaughter:

So the EO puts a lot of focus on the worker side, which is what we think of as the monopsony side of the equation. And I think that that is really, really important and really admirable. You asked whether it has any teeth. I think it absolutely has teeth in a number of different ways. So the EO directs a bunch of different things. It directs executive branch agencies to take specific actions. Like, for example, I think it directs, I think it’s the FDA to pass a rule making to make hearing aids more accessible and cheaper over the counter. That’s a huge deal to real people.

Preet Bharara:

And very specific.

Rebecca Kelly Slaughter:

Yeah, it has a lot of really specific stuff, but that specific stuff really matters. So the president absolutely has the power to do that. And that’s great. Going back to the point that we were discussing earlier about the Federal Trade Commission being an independent agency, it doesn’t actually the Federal Trade Commission to do many particular things, but it asks us to consider doing things. All of which I think are a stellar idea. And we’ve already started acting.

Preet Bharara:

And you will do them. And you will do those things. Okay.

Rebecca Kelly Slaughter:

I hope that we will do them. We’ve already started acting in line with the executive order, for example, by publishing on, I will note, a unanimous bi-partisan basis, a policy statement with respect to repair restrictions. So these are the rules that say your fancy device, or your tractor, or your car, can only be serviced by the manufacturer. And there are technological and mechanical limitations put into devices to make that so. And the justification for that has been sometimes safety, or product quality, but what it leads to is increased expense, lack of choice in markets, lack of opportunity for people to have control over the goods that they buy. And this is something the Federal Trade Commission has been looking at.

Preet Bharara:

Higher prices, too?

Rebecca Kelly Slaughter:

And higher prices, exactly, across the board. It’s something that’s really important to farmers who want to be able to repair their own farm equipment. In our policy statement, we committed to addressing these repair restrictions from both a consumer protection and a competition perspective and pursuing these cases, which we hadn’t done for a while.

Preet Bharara:

But the EO doesn’t ban that practice of exclusivity, right?

Rebecca Kelly Slaughter:

Is does not being that practice. The EO, it really… So it directs executive branch agencies to do specific things. And it suggests that the FTC should exercise its statutory authority to, so in this case, to address unfair anti-competitive restrictions on third-party repair or self-repair of items, such as the restrictions imposed by powerful manufacturers to prevent farmers from repairing their own equipment.

Preet Bharara:

And do provisions like that, sections like that of the executive order have bipartisan support?

Rebecca Kelly Slaughter:

Well, that one did. I mean that one got a 5-0 when we passed our policy statement. And so I think that there are some glimmers of bipartisan hope here. I think it depends on how the authority is exercised. This was a policy statement, not rulemaking. I think the Republicans are a little bit more reticent when it comes to rulemaking. And I think they would say that, but I think there are certainly areas of common ground.

Rebecca Kelly Slaughter:

And the idea that we should have competitive markets is actually also an area of bipartisan agreement. I think everybody shares that view. I don’t think we have done nearly enough antitrust enforcement over the last several decades, not even close, but I will point out that the Republican-led FTC over the last several years brought more enforcement actions than several of its predecessors. And as I said, the original Facebook complaint was filed on a bipartisan basis. So-

Preet Bharara:

Some of the issues you talk about, I think it’s very important. At the same time, it’s important to talk about Facebook. And some of these things that are hard to get a handle on and hard markets to define some basic principles like fixing your tractor in a way that’s cheap and efficient and doesn’t overly enrich in an anti-competitive way. The manufacturer of the tractor, that’s something very concrete, as we said, that people can get their arms around. There’s another area that’s important, and I’ve always found compelling, that affects ordinary people often, is the non-compete clause. You go work for a company. Can you explain quickly what that is and what the order says about it?

Rebecca Kelly Slaughter:

Yeah. So, first of all, I very much appreciate you saying non-compete clause not non-compete agreements because I do not think that these are actually agreements because I don’t think most people fairly bargained for them. Non-compete clauses are terms and employment agreements that say, after you stop working for me, you can’t work for any of my competitors.

Preet Bharara:

For some period of time.

Rebecca Kelly Slaughter:

For some period of time. So they can apply to everyone from high-level executive at a company to a paralegal, to, we hear a lot about their application in, for example, the fast food industry. And people offer different justifications for them. Usually, the justification is along the lines of companies won’t invest in training their workers if the worker can take that training to then go and work for a competitor. I will tell you, I have never found that argument particularly compelling because I think companies have to invest in training their workers so that they can do the job.

Rebecca Kelly Slaughter:

You can’t have workers who are untrained. And if they don’t want their employee to go work for a competitor, they could perhaps consider offering better wages or working conditions to retain employees rather than a conscripted employment contract terms. So I think it’s something that is been a focus of attention for awhile. I think it’s a subject of real bipartisan concern.

Preet Bharara:

Well, because it’s silly. It’s silly.

Rebecca Kelly Slaughter:

Because it’s silly.

Preet Bharara:

And does the executive order ban this practice outright in all the corners of America?

Rebecca Kelly Slaughter:

It says it does not. It says-

Preet Bharara:

It does not?

Rebecca Kelly Slaughter:

It does not. Because again, you know.

Preet Bharara:

I know. I’m giving you grief. I’m giving you some grief.

Rebecca Kelly Slaughter:

Well, because what we don’t want is executive orders to do illegal things. So what it says instead is to address agreements that may unduly limit workers’ ability to change jobs, the chair of the FTC is encouraged to consider working with the rest of the commission to exercise the FTC statutory rulemaking authority under the Federal Trade Commission Act to curtail the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit worker mobility. So the FTC is actually collecting comments about unfair clauses like this. I think it’s something that we did a workshop on a couple of years ago.

Rebecca Kelly Slaughter:

I think it’s a really important topic for attention and one of those things that it’s real people in very material ways. It actually goes to exactly why I love the FTC’s work, which is that it isn’t always headline grabby in a politically… I mean, it has been recently. But it hasn’t historically been headline grabbing in a politically attractive way the way some of the things that we worked on the Hill are more hot-button political topics, but it’s work that really matters to real people in their everyday lives. And affects their ability to participate in society, in the workforce, in the economy. And that is really satisfying to be able to do that work and help people.

Preet Bharara:

Yeah, I think part of it is a matter of messaging and communication that it seems very esoteric and antitrust is very… I think one of the more complicated areas of law if you’re actually practicing in it. But the more you can make it concrete and specific, and the more you can make it about results and fairness, and the more you can make it clear, in my view, and I assume this is your view too, that antitrust enforcement is pro-competition, yes, but also pro-capitalism in the way it was meant to be fair.

Rebecca Kelly Slaughter:

That’s exactly right. I think it was on your podcast that I heard Senator Klobuchar talking about how we need to say competition not antitrust, because people understand that a little bit better. Unless I’m misremembering that. I know she has said that.

Preet Bharara:

No, I think it may have been. And I think people understand the concept of free markets. Some aspects of this work, people understand, I think more than others. Like predatory pricing, stuff like that. Collusion over drug prices, I think people understand that. But a lot of the stuff we’re talking about becomes complicated unduly when you talk about the statutes and you talk about how the agencies work.

Rebecca Kelly Slaughter:

To be fair, I’m not sure the statutes are all that complicated. I think the jurisprudence and the way antitrust law has developed-

Preet Bharara:

Has developed around it. Yeah.

Rebecca Kelly Slaughter:

… to make it this very convoluted, complicated, quantifying, measuring, quantifying, balancing of costs and benefits and harms. Which kind of econ PhD is going to testify about what aspect of the market? That does make it very inaccessible. But the mere concept that we should have fair competition on the merits, which is basically what the statutes say. I don’t think that’s that complicated for people to get.

Rebecca Kelly Slaughter:

This was something, I will confess I think the questions about big tech and market power are really important and we should be devoting a lot of energy to address them. But I also sometimes worry that a myopic focus on big tech leads us to forget all the other areas of the economy where concentration and collusion and lack of competitive free market conditions are a huge problem. You mentioned a couple of them, drug prices, healthcare, we talked about repair restrictions, but it is really economy wide.

Rebecca Kelly Slaughter:

When I worked for Senator Schumer in the Senate in 2017, I want to say in the summer of 2017, the first piece of the Democrats’ economic agenda that they rolled out was an antitrust agenda. They called it the Better Deal. And it was about competition. And we talked a lot about ways we need to improve the antitrust laws to address lack of competition in all areas of the market. Ones that I find very compelling, eye glasses, contact lenses, beer. These are all deeply-concentrated industries that speak to real people. I mean, cell phones is another one. Airlines.

Rebecca Kelly Slaughter:

You can go basically across the economy and we don’t see that many truly competitive markets. And that is a big systemic problem. So it’s important to talk about big tech, but it’s also important to talk about the other pocket book issues that people feel in a real way. Agriculture is another one. Food prices.

Preet Bharara:

Yeah, no, I agree. I think you need to staff up. I think you need some more folks.

Rebecca Kelly Slaughter:

I think we need to staff up, too. I would love… I think that that is a great idea.

Preet Bharara:

Rebecca Kelly Slaughter, thanks for being on the show. It’s a real treat to talk to you. And congratulations on all your success.

Rebecca Kelly Slaughter:

Thank you so much for having me.

Preet Bharara:

My conversation with Rebecca Kelly Slaughter continues from members of the CAFE Insider community. To try out the membership free for two weeks, head to cafe.com/insider. Again, that’s cafe.com/insider. Well, that’s it for this episode of Stay Tuned. Thanks again to my guest, Rebecca Kelly Slaughter.

Preet Bharara:

If you like what we do rate and review the show on apple podcasts or wherever you listen. Every positive review helps new listeners find the show. Send me your questions about news, politics, and justice. Tweet them to me @PreetBharara with the #askpreet. Or you can call and leave me a message at 669-247-7338. That’s 669-24 Preet. Or you can send an email to staytuned@cafe.com.

Preet Bharara:

Stay tuned is presented by CAFE Studios and the Vox Media Podcast Network. Your host is Preet Bharara. The executive producer is Tamara Sepper. The senior producer is Adam Waller. The technical director is David Tatasciore. The CAFE team is Matthew Billy, David Kurlander, Sam Ozer-Staton, Noa Azulai, Nat Weiner, Jake Kaplan, Chris Boylan, and Sean Walsh. Our music is by Andrew Dost. I’m Preet Bharara. Stay tuned.