FTC Chair Lina Khan defends merger and acquisition crackdown
Federal Trade Commission Chair Lina Khan said in an interview that aired Sunday that corporations are driving inflation and defended her agency's role in cracking down on mergers and acquisitions.
Khan was interviewed for CBS News' "60 Minutes" by Lesley Stahl, who attended a town hall held by Khan and Rep. Alexandria Ocasio-Cortez, D-N.Y., where the FTC chair said, "Too often fewer and fewer companies are controlling more and more of the market. And what that means is companies can start ripping you off, hiking prices, stealing from you."
"So there's no doubt that the pandemic and the war led prices to soar. What's been interesting is that even as some of those supply chain pressures have eased, prices have not come down concurrently as much," Khan said in the interview with Stahl about the cause of inflation. "There's a lot of discussion about what's driving the inflation, and we've actually seen some executives boast on earnings calls about how inflation is great for their bottom line."
Khan also said that proposed mergers and acquisitions, which fall under the FTC's regulatory oversight, have to preserve the competitiveness of the marketplace even if they create efficiencies that result in lower prices for consumers.
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"Even if those efficiencies arise, if the company's not checked by competition, it won't have an incentive to pass those benefits on to the consumer because those consumers may not have anywhere else to go," Khan said.
Stahl noted that the FTC's oversight and investigation of proposed mergers can sometimes create a chilling effect that results in companies abandoning the deal.
"Sometimes, you know, the companies decide that they're going to abandon the merger," Khan said. Stahl asked if abandoning a merger amid the FTC's scrutiny was a win, to which Khan said, "That's right."
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Khan added that it's "important to step back and keep all of this in context" and explained, "Of all the thousands of deals that are proposed every year, the FTC and DOJ collectively investigate maybe 2% or 3%."
The chairwoman was asked if she ever worries that the power the FTC and its chair have could "result in a destabilizing of basically the whole economy."
"Of course we have to worry," Khan said. "But we also should worry about the destabilizing effect that can arise from companies believing that they're above the law, and that they can be reckless, take massive risks in ways that can crash the economy, and then they can get away with just a slap on the wrist, and that creates a destabilization too."
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The FTC is facing lawsuits accusing it of overstepping its authority, which Stahl noted could have the end result of courts clamping down on the agency's powers.
She asked Khan if that potential outcome was concerning and the chairwoman replied, "I think one challenge that agencies can face is when they shrink their own powers and authorities by not actually using the authorities that Congress has given them."
Stahl asked Khan about whether she would stay in her role at the helm of the FTC if Vice President Kamala Harris wins the election, given some of her biggest donors have publicly called for Khan's ouster.
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"My focus is not listening to what CEOs are saying on TV. It's important in these jobs to really stay focused and block out a lot of the noise," Khan said. "There's so much work to be done, and it's such an honor to be in this role. And it would be an honor to have that opportunity to keep going."