What Khan’s Non-Compete Loss Tells Us About the Fate of the Harris Price-Control Plan

By Robert H. Bork, Jr.

August 24, 2024

Federal Trade Commission Chair Lina Khan is always shopping for the right judge to validate her eccentric, extra-statutory theories of antitrust as a way to regulate everything. Yet in case after case, Khan keeps coming up snake eyes.

Her latest loss was sealed by the gavel of federal Judge Ada Brown. Judge Brown had issued a preliminary injunction stopping Chair Khan from enacting a national ban on non-compete agreements that employers impose on workers. On Tuesday, Judge Brown tossed out this self-declared FTC policy altogether.

“The role of an administrative agency is to do as told by Congress, not to do what the agency thinks it should do,” Judge Brown wrote. She criticized the FTC for seeking to enact a national policy rather than do what the agency is empowered to do by Congress—to target “specific, harmful non-competes.” She halted what would have been a breathtaking expansion of FTC’s power based on no law whatsoever.

Khan’s loss in this federal court in Northern Texas has larger significance for the presidential race. It points to the flaw in the plan of Vice President Kamala Harris to rely in part on the FTC to enact regulation of the national economy through price controls, beginning with food prices.

From the start, the vice president’s plan prompted a lot of head-scratching. Food prices had been low and stable for more than 40 years, running at about 2.5 percent a year, just keeping up with inflation. Then the Biden-Harris Administration poured inflationary gasoline on the waning pandemic fire and supply-chain disruption with the risibly named Inflation Reduction Act.

For anyone familiar with the well-documented effects of the debasement of a currency, from the Roman emperor Diocletian to Weimar Germany to Argentina, spending public money at a frantic pace results in inflation. In this case, Americans saw double-digit inflation in food prices. However, the Harris campaign has a political need to blame inflation on greedy corporate executives, deflecting from their own irresponsible economic management. Never mind that for some reason, these executives were content to merely keep up with inflation for decades until the Biden-Harris Administration began to add a trillion dollars to the debt every 100 days.

Now that inflation is subsiding, Harris wants to enlist the FTC to use antitrust investigations and authority to bludgeon companies into accepting the prices that regulators think best.

The good news here, amply demonstrated by Judge Brown, is that there are still principled jurists dedicated to the Constitution willing to keep progressive antitrust in check. The same happened when Khan’s quixotic cases against Meta’s acquisition of a virtual-reality fitness app called Within, or Microsoft’s acquisition of game-maker Activision Blizzard. In each case, a judge refused to swallow Khan’s exotic antitrust arguments that were grounded neither in the law nor in sound economics.

These jurists have dealt Khan one loss after another, halting her plans to give the FTC powers to regulate the economy not found in law. They would surely do the same to a President Harris plan to turn the FTC into an economic super-regulator. But can we continue to count on the judiciary as a bulwark against progressive anti-trust?

Looking ahead, the threat of regulatory socialism remains. It can be found in the rising generation of lawyers coming out of our law schools. Khan and her fellow progressives are doubling down on evangelizing in the law schools. Khan herself makes frequent “star” appearances at law schools, where adoring deans introduce her as the prophet of a new age of the “neo-Brandeis” school of antitrust. (Never mind that the original Justice Louis Brandeis was as suspicious of big government as he was of big business, frustrating one New Deal scheme of President Franklin Delano Roosevelt’s administration after another.)

Worse, Khan’s allies in the law school are committed to creating a progressive monoculture in academia. They keep an eagle eye out to nix any new faculty appointments for those who adhere to the law and a belief in free markets.

To protect the consumer welfare standard in antitrust, and to educate the next generation of judges, lawmakers, and regulators, defenders of the law and free markets must get out into the law schools. We can’t count on the next generation to produce more Ada Browns.

We must evangelize too.

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Robert H. Bork Jr. is the president of the Antitrust Education Project.

Originally published at American Greatness.