Declan McCullagh wrote:

I am very amused to see the Naderites on the warpath again. Better yet is their claim that the Microsoft DoJ action is divorced from politics.

Declan, what exactly is that "claim" that you refer to? Are you referring to my note on AM-INFO that DOJ filed against Microsoft without consulting the White House? (Something that has been reported in the press.. WSJ?). Or is there something else you are referring to. I don't think I would say any antitrust action is "divorced" from politics, including this one. Jamie This

is an excerpt from a message I posted to another list. Might be interesting.

-Declan

---

...

"Fundamentally, I think it's a legal issue," says Ed Black, president of the Computer and Communications Industry Association. "But to say whenever the wealthiest man in America and one of the most powerful companies in America is challenged by a cabinet official, you can't say there's no political impact. You're in a political world at that level."

And if we look at the history of antitrust we see that the political world is often the most important one:

-- Nixon intervened in an antitrust action against ITT in 1971 in exchange for a bribe: a hefty contribution to the 1972 Republican convention. "I don't know whether ITT is bad, good or indifferent," he said on April 19, 1971, the White House tapes reveal. "But there is not going to be any more antitrust actions as long as I am in this chair...goddam it, we're going to stop it."

-- Bush's assistant attorney general derailed a criminal investigation of Georgia Power. This after the U.S. attorney in Atlanta had issued more than five hundred subpoenas and two hundred witnesses were called to testify before the grand jury. Why? Months earlier, the company's CEO raised millions of dollars for the Republicans in 1988.

-- AT&T and its manufacturing subsidary were engaged in a billion-dollar-a-year price fixing scheme, the Justice Department claimed in a complaint filed in January 1949. AT&T persuaded a slew of high Defense Department officials to oppose the action on national security grounds. The Defense Secretary himself opposed it because of the "Korean emergency." They forced the DoJ to settle the case without getting what it wanted: AT&T to sell Western Electric.

-- Teddy Roosevelt (who Jamie might recall was widely reported to be a "trust buster") headed off a DoJ antitrust investigation of the electrical industry. Roosevelt wrote: "I feel very strongly that the less activity there is during the presidential election, unless it is necessary, the better it will be."

Former NY Times and Newseek reporter David Burnham writes in his book about the Justice Department: "The record is clear. Political campaign contributions, personal bribes and other direct and indirect favors have frequently influenced important Justice Department disions about the enforcement of law... Virtually every administration has demanded that the Justice Department bend the law..."

-Declan

-- James Packard Love Consumer Project on Technology P.O. Box 19367 | Washington, DC 20036 voice 202.387.8030 | fax 202.234.5176 love@cptech.org | http://www.cptech.org

Paul Spirito wrote:

Declan,

All of your examples are of antitrust actions *stopped* by political pressure. Of course, monopolies tend to have lots of cash, & that buys influence -- but this is just one more reason to bust them: the disproportion in economic power within the industry corrupts the political system.

I have worked on several antitrust issues over the past several years. My first serious attempt to stop a a merger involved tbe Thomson purchase of West Publishing, for $3.4 billion. This involved 2 of the three large legal publishers (West was number 1). West publishing was a privately owned firm. The largest shareholders were the Opperman family. The Opperman family gave Clinton and other democratic party funds more than $300k during the merger review, directly, and raised more from third parties. Vance Opperman had coffee with Clinton and dinner with Gore during the review. Earlier Vance had approached Clinton at a fundraiser to intervene in a Reno antitrust investigation of West (which was dropped). The merger was approved, after a compulsory license and some modest divestitures (we were quite unhappy with the result). We opposed the Bell Atlantic/Nynex merger (we didn't do as much as we should). Bell Atlantic has so much capitol hill juice they were able to hold up Klein's nomination, basically until the merger was approved. We opposed the Staples/Office Depot merger, and were quite active. This was before the FTC. Staples launched a very large PR campaign, with some hill lobbying, but the FTC held its ground, and the merger was stopped. We opposed the Boeing/McDonnell Douglas merger. Not only did the FTC permit the merger without any strings (Numbers 1 and 3 in a 3 firm market with huge entry barriers), but Bill Clinton personally lobbied the EC to approve the merger, and sent a delegation to Brussels, which included Joel Klein, the DOJ antitrust head, to argue against divestiture of the McDonnell Douglas civilian airline business. I've worked on other mergers, including mergers in the railroad industry, the hospital industry, and the pharmaceutical industry, and I have been involved in other antitrust issues, such as in attempts to get the FCC to make cable systems unbundle set top boxes, and create cross ownership rules between cellular and PCS, and cable and DBS. In virtually every case politics played a role. Typically, the incumbent firms, or the one that want to merger, have the most influence, politically. Thus, I was surprised to hear Declan say that we thought politics didn't play a role in antitrust actions against Microsoft. There are many areas where politics come into play. Gore sent his daughter to work for Microsoft during the DOJ investigation. Microsoft has rallied its troops, starting with the Washington state delegation, they have also picked up players like Vin Weber to talk with Ginrich, and they are involved in countless other attempts to influence the Congress and the executive branch. Microsoft's competitors have been active too. Senator Hatch is obviously concerned about what MS had done to Novell and Wordperfect. The stakes are high, and there is a lot going on. That doesn't mean politics is the whole ball game. Public opinion is a big factor, as is the opinion of experts or reasonably informed persons. It is generally difficult to get DOJ or the FTC to bring an antiturst action against anyone. The Microsoft case is very high profile, for many reasons. Now that DOJ is engaged, I would expect them to make every effort to prevail on the narrow issue before the court. Who knows if DOJ will be interested in pursuing the broader issues about MS's use of the OS to gain leverage in applicaitons markets. There is a lot still up in the air. Jamie -- James Love Consumer Project on Technology P.O. Box 19367, Washington, DC 20036 voice 202.387.8030; fax 202.234.5176 http://www.cptech.org | love@cptech.org

-----BEGIN PGP SIGNED MESSAGE----- On Wed, 26 Nov 1997, David Honig wrote: [...]

At 09:04 PM 11/25/97 -0500, Glenn Hauman wrote:

...

Hold it-- are you suggesting that the DOJ is being restrained in going after Microsoft? By who?

The secret MS hack which disables OS's running under .gov domains when the right signal is given :-) :-)

There is a secret hack that crashes MS OS's? Um, is there one that actuly makes them work? - -- Please excuse my spelling as I suffer from agraphia see the url in my header. Never trust a country with more peaple then sheep. ex-net.scum and proud You Say To People "Throw Off Your Chains" And They Make New Chains For Themselves? --Terry Pratchett. I do not reply to munged addresses. -----BEGIN PGP SIGNATURE----- Version: 2.6.3i Charset: noconv iQCVAwUBNHz9GKQK0ynCmdStAQE64wP9GuNFRVRQz33Ym9/qePiAZ/2k3jnd63Dg YEeeqsHvVxIMNgwd1yN05YPu2kXjt19CqmFeBMgYFYQT7qr9pul5EIUAX43/W6yO oCymE7dZaei7pobk2owQ2M0kqSqpOzPGXBZW7SS4jqX511U+Mjg7PZyOEeBqYoWo mpzZr36ftJo= =TKbY -----END PGP SIGNATURE-----