In October 2016, the announcement that AT&T wanted to buy Time Warner helped bring some unity to a deeply divisive presidential race. The $85 billion deal aimed to combine the biggest telecom company in the country with some of the nation’s top news and entertainment producers, including HBO, TNT and CNN. Faced with the prospect of a media and data behemoth with unprecedented power over vital information, both the Democratic and Republican presidential nominees were skeptical of the deal.
Candidate Donald Trump vowed to block the merger if elected. “It’s too much power in the hands of too few,” he said. Hillary Clinton said the deal “raises questions and concerns” and Sen. Tim Kaine (D-Va.) said “less concentration” in the media would be “helpful.” Others followed. Sen. Bernie Sanders (I-Vt.) warned that the result would be “a gross concentration of power” and called on the Obama administration to stop the deal. Democratic Sens. Elizabeth Warren (Mass.), Al Franken (Minn.), and Amy Klobuchar (Minn.) all made their opposition clear.
Yet this week, when the Justice Department, led by newly appointed antitrust chief Makan Delrahim, reportedly took steps to block the merger, some progressives, like Joe Nocera and Charles Pierce, rushed to AT&T’s defense. The Antitrust Division’s real aim, they said, was to hurt the cable news network CNN in retaliation for its tough treatment of the Trump administration. As Nocera of Bloomberg wrote, “I never thought I would be rooting for two very big companies to combine into one giant company, but I am.”
This fear is understandable: Americans don’t want antitrust to be a political tool of any president. But both Democrats and Republicans have to be careful not to open the door to an equally dangerous prospect — of dangerous monopolists wielding flimsy or even untrue political threats to justify their concentrations of power, especially over flows of information and news. As the case progresses, it is vital the public distinguish carefully between two questions: Does the government case against this particular merger have merit; and how do you prevent the White House from ever interfering in this or any other antitrust case.
On the first question, the basic facts are the same as in October 2016, and citizens should oppose the deal for the same reasons they did 13 months ago. The business model of a combined AT&T Time Warner is rife with conflicts of interest. AT&T’s direct control over essential news and entertainment would give that corporation a permanent pricing advantage over rival cable networks. Similarly, AT&T would have a natural interest in favoring its own channels on its cable, satellite, and mobile video distribution networks, over other networks.
Should the DOJ succeed in blocking the merger or forcing big divestitures, the public would probably see other positive effects. Such an action would, for instance, discourage other deals in a media marketplace already radically too concentrated. In fact, there are already reports that media executives are changing their thinking around other deals as they wait to see how serious the government is. By contrast, if the deal is waved through, it would probably be read as carte blanche for other powerful corporations — including online platform monopolies Facebook, Google and Amazon — to roll up power in an even more reckless and brazen way than now. (Amazon chief executive Jeffrey P. Bezos also owns The Washington Post.)
On the other hand, the fear President Trump might be using antitrust law to reward friends and punish enemies is valid and important. Trump has never shown any respect for basic rule of law. He has, for instance, more than once called on the FBI to investigate his political opponents. In the specific case of CNN, the president has repeatedly attacked the channel’s coverage of him as “fake news.” His followers on extreme right-wing sites like Breitbart have openly mused about the use of legal tools, including merger law, to intimidate and control the news channel.
If true, Trump would not be not the first president to consider using antitrust to achieve political ends. President Richard Nixon once demanded the Justice Department hold off on an antitrust suit against ITT for partisan reasons.
But the way to deal with White House meddling in antitrust is not to stop enforcing the law (in this case, the Clayton Act), especially at a time of increasingly extreme concentration of power, specifically in media. Instead, both the DOJ and Congress must take every step they can to demonstrate the absolute integrity of the antitrust enforcement process. Congress should hold hearings over this merger and demand from Delrahim all the information necessary to ensure there is no political interference by the president. Congress should do this for other politically dangerous media combinations, such as the announced Sinclair-Tribune merger overseen by FCC Chair Ajit Pai.
In July, anticipating some possible political interference, Klobuchar issued a warning to the White House about meddling in the AT&T Time Warner merger. She wrote in a letter to Attorney General Jeff Sessions, “it appears that some advisers to the President may believe that it is appropriate for the government to use its law enforcement authority to alter or censor the press. Such an action would violate the First Amendment.”
The public should also not forget that AT&T has the right to appeal any decision by the DOJ to the courts, where the Antitrust Division would have to litigate the case in the open. AT&T would have ample opportunity to bring any evidence of White House interference to light. In fact, the Tunney Act of 1974 was passed for this very reason after Nixon’s interference with ITT. The act allows courts to review antitrust settlements, meaning that if the DOJ and AT&T came to a settlement, the court would have a right to hold hearings, take testimony of government officials or experts, appoint special masters, consultants or expert witnesses, admit amicus curiae or intervenors, review written comments, responses and objections, and “take other such action in the public interest as the court may deem appropriate.”
Going forward, it seems probably the public will face similar concerns over the next three years, as the DOJ brings other cases against telecom corporations and maybe even the online platform monopolists. If so, it is perhaps most important to keep in mind that the idea that any particular private corporation will protect the public interest is extremely dangerous. This is especially true of the news. As the Founders taught, and as the antimonopoly reformers of the 20th century fully understood, the only way to protect our democracy is to ensure as wide a distribution as possible of publishers and producers of news, and that no one or few corporations ever centralize control over our journalists. American democracy will never be saved by any one or few “good” corporations. The only thing that will save our democracy is the people, using our government to break all dangerous concentrations of power, be it in the private sector or in government itself.