Antitrust law is defended as an essential governmental counterweight to the tendency for monopolies to take over markets and squelch competition. That chimera almost never happens as long as government doesn’t intervene to create a monopoly, but it does give anti-market busybodies a powerful tool to mess things up.
In this AIER article, Duke economics professor Michael Munger explains that the quest for “perfect competition” is folly, a costly one that ends up harming consumers.
Munger writes,
In just the past month, we have seen how contradictory, and frankly harmful, the new perfect competition paradigm can be. The logic of antitrust enforcement is to take the “industry” as a narrowly defined set of firms all in the same business, and then to imagine breaking up those firms into smaller subparts, to create more choices for consumers. That logic catastrophically precludes actual increases in the real kind of competition — new firms strong enough to offer a real fight.
Under the Biden administration, the people in charge of antitrust policy are progressives eager to expand governmental power no matter how much long-run damage they do. The head of the Federal Trade Commission, Lina Khan, can’t resist filing needless lawsuits when she perceives any “threat to competition.” Right now, it’s credit cards. Tomorrow it will be some other phantom menace.