Where Does the FTC’s New Policy Statement Leave Consumers? Worse Off.

The Federal Trade Commission (FTC) is at it again, this time reinventing decades of accepted antitrust law and precedent at the expense of consumers. Last week, in a partisan 3-1 vote, the FTC released a new policy statement which vastly expands how the agency defines “unfair methods of competition.” The 16-page document contains a number of concerning statements. But perhaps worst are the omissions: the word ‘consumers’ appears just twice in the main text – shocking for an agency that is meant to focus on consumer protection.

In recent years, American consumers have benefited from an unparalleled growth in innovative, internet-based products and services. You can now easily order groceries for same-day delivery, communicate with loved ones through video conference, and stream the latest shows and movies. Consumers have demanded more and easier options, and American tech companies have delivered.

Our leading tech companies are the envy of the world. Their competitive advantage rests in part on established U.S. antitrust principles that provide predictability and legal certainty, and encourage innovation and risk-taking. In America, consumers – not government – hold the power to determine a product’s success in the marketplace. Companies of all sizes benefit when agencies promote unified, clear, and transparent approaches to review. Legal predictability leads to innovation and investment, which translates directly to consumer benefits.

Sadly, the FTC’s new manifesto takes a different approach. In its latest Policy Statement, the FTC unilaterally declares that a new product, service, marketing tool or innovation can be found illegal, simply because three Commissioners say it’s so. For decades, commissioners from both parties held up consumer welfare as the gold standard for determining legality. This meant that the FTC didn’t protect individual competitors; it protected competition itself. This shared ethos played a major role in safeguarding competition policy from the uncertainty of subjective or political influences.

The FTC’s new ‘we’ll know it when we see it’ approach encourages status quo companies and industries to lobby and use the political process to distort competition and preserve and favor the status quo. That’s a recipe for global competitive disaster. If seen through, it will squelch the best of American innovation – and our economy along with it.

In less than 60 days, thousands of companies will descend on Las Vegas for CES 2023?. The headlines coming out of this CES, as has been the case for more than 50 years, will tout the amazing advances presented by hundreds of companies, large and small. As I often say, the next great idea and game changing innovation can come from anywhere. That’s the story of American tech innovation.

I fear the FTC’s approach will effectively force companies to get the government’s permission to innovate. This would leave consumers with fewer choices and an American tech industry at a severe competitive disadvantage over other nations. Is that really what we want?