The FTC has yet again targeted another top 10 U.S. company in an antitrust case relating to a monopoly. Lina Khan, Chair of the FTC, has been seeking to slow down American multinational corporations since her appointment by the current administration in 2021. This time she’s selected a company that she knows all too well, Amazon. In 2017, Lina wrote a paper in law school arguing for the breakup of the Amazon, claiming that the company was violating antitrust laws. This one might be personal.
Amazon In The Crosshairs
The FTC’s latest antitrust case is against Amazon and the commission alleges that the company holds and abuses an online retail monopoly. This case is hard to take seriously when you consider that Amazon accounts for less than a third of total e-commerce sales in the U.S. over the last four quarters. To go further, Amazon has one of the thinnest margins among online retailers in the U.S., amounting to just 5% (profit margin). One can hardly say that they have a monopoly and are using it to abuse online retail, unless you’re Lina Khan.
FTC’s Terrible Track Record
This isn’t the first time that the FTC has alleged an antitrust case against a U.S. multinational, and it isn’t the first time they referred to a monopoly as the key reason. The FTC has been wasting taxpayer funded resources in bringing cases that are founded on weak evidence, most of the time just pointing out business conditions in a capitalistic environment. Managing a business to grow profits and secure competitive advantages isn’t a crime, it’s just business. Over the last 12 months, here’s a couple of the antitrust cases that the FTC has lost:
- Microsoft’s acquisition of Activision-Blizzard
- Meta Platform’s acquisition of Within Unlimited
In both cases the FTC was unsuccessful in their attempt to block the transactions on grounds of perceived monopolies that would limit competition in their respective business lines. Following the losses, Chair of the FTC, Lina Khan, went on to say “in the scheme of our merger enforcement program, losing two is okay.” The problem is that it’s not okay to waste taxpayer dollars on antitrust cases that have no chance of success; and the Amazon case will likely be another loss for the FTC which will add to the perils of the commission.
There’s no doubt, by the numbers, that Lina Khan has filed more cases than her predecessors, she’s also a lot younger than most of her predecessors. The current FTC chair might be too over zealous in her pursuit to slow down capitalism and she’s probably ready for a haircut if this Amazon antitrust case results in yet another loss for the commission.