Re: Joel Klein's lobbying for Boeing -Reply

[Wayne Dale Collins <wcollins@shearman.com>]

  I guess I have a slightly different perspective than Jamie.  My view is that
  the primary policy role of the chief U.S. antitrust enforcement official is to
  promote U.S. interests in the efficiency of the marketplace.  The antitrust
  head does this is two principal ways: 
  
  (1) bringing enforcement actions in situations where the conduct in
  question reflects a market failure, the market failure reflects an antitrust
  violation, and the violation has a remedy that will likely make consumers
  better off than they were when the violation was in place; and equally 
  
  (2) closing investigations as quickly as possible where the conduct in
  question does not reflect a market failure, does reflect a market failure
  but is not the result of an antitrust violation, or constitutes a technical
  antitrust violation but is not remediable in the sense that the antitrust cure
  is better than the disease.
  
  In the other words, the government should intervene when it should
  intervene, and it should get out of the way as quickly as possible and
  permit private to conduct their affairs in an unfettered fashion when
  intervention is not warranted.  
  
  In the Boeing case, the U.S. government (in the form of the FTC)
  determined that the transaction would not harm U.S. efficiency interests
  and indeed did not constitute a violation of U.S. antitrust law.  The EU
  took a different view.  It seems to me perfectly appropriate for the U.S.
  government to try to change the EU's mind to align EU actions with U.S.
  interests.  
  
  Now as to what U.S. officials to do what things.  I suspect that Joel Klein
  personally did not threaten EU officials with a trade war if they did not go
  along with the Boeing deal, but rather argued the U.S. view that the
  merger would not reduce efficiency (i.e., be anticompetitive in a U.S.
  antitrust law sense) and therefore should not be opposed by the EU on
  the merits.  
  
  If Joel was asked and offered his views as to what other officials in the
  U.S. (such as those in the white House, USTR or commerce) might be
  urging as a response to an EU intervention, that too seems to me to be
  perfectly appropriate.  After all, the more information the EU has about
  the likely U.S. response, the more informed view it can take in making its
  decisions.  
  
  As long as Klein kept his primary focus on the competitive effects of the
  transaction and was not personally making the trade war case to the EU,
  I do not see how the EU officials could respond adversely as a matter of
  principle to his visit.  Indeed, they should have welcomed it, even if they
  disagreed with the message.