By: Nikhil Aerabati
Edited By: Cynthia Huang
Over the past century, the interpretation and enforcement of antitrust laws have evolved in response to changes in the economy and political landscape. In this article, we will explore the history of antitrust legislation and how it has changed, with a focus on the sources and dates of key events.
The first antitrust laws in the United States were passed in the late 19th century, with the Sherman Antitrust Act of 1890 standing out most. This act made it illegal for any person or company to monopolize or attempt to monopolize any part of interstate commerce (Sherman Antitrust Act, 1890). However, due to a Supreme Court loophole, the act was not enforced very strictly until the Progressive Era. By this time, President Theodore Roosevelt began using it to break up large monopolies such as Standard Oil (1911) and American Tobacco (1911) (Roosevelt, T., 1911).
In the following decades, antitrust enforcement continued to be a priority for the federal government. The Clayton Antitrust Act of 1914 strengthened the Sherman Act by adding provisions that expressly prohibited certain anticompetitive practices, such as price fixing and exclusive dealing (Clayton Antitrust Act, 1914). The Federal Trade Commission Act of 1914 also established the Federal Trade Commission (FTC), which is responsible for enforcing antitrust laws (Federal Trade Commission Act, 1914).
During the mid-20th century, antitrust enforcement shifted away from breaking up large monopolies and towards preventing mergers that could lead to the formation of trusts. For instance, the Celler-Kefauver Act of 1950 made it illegal for any company to acquire another company if the effect would be to substantially lessen competition or tend to create a monopoly (Celler-Kefauver Act, 1950).
However, in the 1970s and 1980s, antitrust enforcement became more lenient, with a focus on the economic efficiency of mergers and acquisitions rather than the potential for monopolies. This change was reflected in the merger guidelines issued by the FTC and the Department of Justice (DOJ) in 1982, which placed a greater emphasis on the potential for increased efficiency as a result of a merger (FTC & DOJ, 1982).
In recent years, there has been a renewed focus on antitrust enforcement, particularly in the technology sector. The DOJ and FTC have both announced investigations into several tech giants, such as Google (DOJ, 2020) and Facebook (FTC, 2019), for potential antitrust violations. Additionally, some lawmakers have called for stricter antitrust laws and enforcement, arguing that current laws are not sufficient to address the increasing power of large tech companies, including Google, Apple, and Samsung (Sen. Warren, 2019).
In short: Over time, antitrust legislation has evolved to respond to changes in the economy and political landscape. Originally focused on breaking up monopolies, the focus first shifted to preventing the formation of monopolies through mergers and acquisitions. Now, legislation is spearheading technology sectors and the possible anti-competitive behaviors of big tech companies.
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