If the FTC has a million haters, I’m one of them. If it has one hater, it’s me. If the FTC has zero haters, it means I have left this world.
While Americans increasingly cannot afford homes or groceries, the government continues to throw our tax dollars at the Federal Trade Commission (FTC)—which has spent the better part of the year trying to destroy Amazon Prime, losing court cases, and suing Google for being too popular. But don’t think their work is done yet. Their crusade against non-existent “monopolies” appears to be just getting started.
According to Politico,“The Federal Trade Commission is investigating if the $10 billion purchase of Subway creates a sandwich shop monopoly with Jimmy John’s and Arby’s. The latter two, in addition to McAlister’s Deli and Schlotzky’s, are owned by private equity firm Roark Capital, which inked a deal to buy Subway in August. The government is focused in part on whether the addition of Subway gives Roark too much control of a lucrative segment of the fast food industry.”
This push earned support from Senator Elizabeth Warren, who tweeted:
This is of course endlessly ridiculous. There were 198,153 fast food restaurants businesses in the US as of 2022, many of which offer sandwiches. Of those, around 50,000 are chain restaurants, and at the vast majority of them, you can commonly find some type of sandwich.
I’m not convinced the federal government has any businesses “monopoly busting” in a truly capitalist system. Capitalism in and of itself breeds competition—innovation is endless, preferences change. The basic dynamics of the market itself are sufficient to break up large companies given time.
But even if one were persuaded by the notion that the government needs to “protect” capitalism from itself and break up monopolies, this would certainly not be that. You’d have to ignore the presence of Blimpie, Quiznos, Which Wich, Panera, Atlanta Bread Company, Pret a Manger and a whole host of other businesses to even begin to make that argument. And that’s just a few of the very well-known, national chains that specialize in sandwiches, not to mention countless other regional chains or mom and pop shops.
Additionally, Subway, Arby’s, and Jimmy John’s don’t just compete against other sandwich shops in the market. The reality is they compete against all other fast food restaurants available to consumers when meal time comes around.
FTC Chair Lina Khan is like the kid in the Sixth Sense, except instead of seeing dead people she sees monopolies—and an excuse to further entwine the federal government in private businesses behind every one.
Because let’s be clear, that’s the true functionality of antitrust. These kinds of investigations and lawsuits rarely lead to a company being broken up (because, again, they aren’t actually monopolies or even harming consumers). Instead they serve as an implicit threat: operate like we want you to or we’ll shake you down and make you spend a lot of money trying to save your businesses.
The FTC is basically just a legalized form of the mafia.
Furthermore, the actions being taken by the FTC do pose a true threat to consumer welfare—you know, the thing that’s supposed to guide antitrust decisions. This is the kind of merger that would likely bring prices down due to the scales of production involved—something many Americans sorely need right now.
It’s worth knowing that while the FTC has been riding around in their clown car, consumer fraud has absolutely skyrocketed since Biden took office. They can’t even perform their own basic functions, but don’t worry guys, they’re going to protect you from the dangers of big sandwich.
Hannah is a consultant for Netchoice, a free market tech trade association that frequently works on antitrust issues.