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Taxpayers at Risk in Anti-Trust Warsby
John Berthoud Feb 1, 1999 The key ingredient to a strong and vibrant economy is a free-market
system that has as little interference from government as possible. Unfortunately,
Washington is not cooperating.
Taxpayers, consumers and business owners know how to make the economy
work. They know how to innovate and adapt to the market environment.
In fact, the economy as a whole will grow most rapidly if the government
removes the roadblocks of regulation and intrusion.
But while taxpayers, consumers and business owners want government to
simply stay out of the way, government continues to throw obstacles in
the path of the free market.
This has been confirmed in recent months by the manner in which the
Justice Department's Antitrust Division, led by Joel Klein, has begun to
target one company and industry after another in order to pick winners
and losers in the economy.
The antitrust police have decided to use the power of their office to
harass and target companies that they have decided are either too large
or too successful. They have left no stone unturned in the effort to impose
their agenda on the American marketplace.
As Newsweek reported a number of months ago, "Klein believes passionately
in 'surgical intervention' in the market place."
We have seen this agenda at work in the government's case against Microsoft, where he and his allies have done everything they can to level one desperate charge after another, regardless of their relation to the merits of the
case.
They have used every opportunity to demonize Microsoft as a company
and its head, Bill Gates, personally, simply because they have no legitimate
case.
The recent merger between America Online and Netscape proves that there
is a tremendous amount of competition and vitality in the computer industry.
The deal confirms that Nobel-prize winning economist Milton Friedman
was right when he criticized the government's case against Microsoft.
This high-tech merger also led South Carolina Attorney General Charlie
Condon to pull out of the case against Microsoft, saying the case had "been
made moot by the actions of the competitive marketplace."
Mr. Condon added that "further government intervention or regulation
is unnecessary and, in my judgement, unwise."
Even the federal judge presiding over the Microsoft trial stated that
the AOL-Netscape merger may very well be a "very significant change in
the playing field" in the computer industry.
He was right on target. The high-tech industry has been a tremendous
engine of economic growth over the last few years because of its vitality
and innovation. The federal government is about to put a stop to that with
its intervention.
It is the typical government solution in search of a problem. The problems
will only begin when the federal government gets its hands on the computer
industry, destroying another piece of the free-market system in the process.
And it's all been done with our tax dollars.
The Antitrust Division's case against Microsoft is only one example
of its attempt to meddle in the economy. In October, Mr. Klein and Attorney
General Janet Reno announced that they were filing antitrust action against
VISA and MasterCard.
It is hard for me to imagine any other element of the economy right
now that is more competitive than the credit-card market. Any person who
opens his mail or answers his phone each day would concur that competition
is rampant.
Consumers can sign up for any credit card they want -- VISA, MasterCard,
American Express, Discover, department store, gas, and on and on.
Individuals can use their credit cards and get cash back from purchases,
frequent-flier mileage, and free gas, among other things.
Average taxpayers and consumers have benefited tremendously from the
competition and innovation in the credit-card industry. But apparently
that's not enough for the Department of Justice. (Or maybe it's too much;
in any case, they'll decide when they get into the courtroom.)
It may only be a matter of time before government lawyers begin full-scale
attacks on the heads of VISA and MasterCard, dissecting pieces of private
e-mails and other correspondence, trying to prove another case without
merit.
Taxpayers, consumers and entrepreneurs should be very concerned about
the recent efforts by the Justice Department and its antitrust police to
meddle with the economy.
These government lawyers stepping in to perform their so-called surgical
intervention will do the opposite of what Ms. Reno and Mr. Klein say they
are doing.
They will ultimately hurt consumers by taking away their choices and
bringing competition and innovation to a crashing halt.
And their schemes will, of course, cost taxpayers untold millions of
dollars and further clog our court system.
The nation will clearly be better off without Ms. Reno, Mr. Klein and
their minions meddling in the economy to carry out a political agenda or
satisfy various constituencies.
This group of government bureaucrats has already decided to target two
of the most dynamic and competitive elements of the economy, and they will
certainly not stop there.
If taxpayers -- who pay the salaries of these government lawyers --
do not speak out now, it will be too late. Two industries will be irreparably
damaged, and the whole free-market system will not be too far behind.
John Berthoud is president of the 300,000 member National Taxpayers Union, which is headquartered in Alexandria, VA.
This work appeared in the "Journal of Commerce." |
