I wish I could confidently say that economics and law will drive antitrust in 2023, but I cannot. Tech antitrust cases pursued in the US and Europe in 2021 and 2022 have been poorly conceived and built on weak factual and economic foundations. Federal Trade Commission (FTC) leadership is seeking to turn the agency away from its traditions of careful analytical and legal work and toward making it a general business regulator that would make decisions based on subjective notions of fairness and poorly defined goals for competition. And Congress has gotten deeply involved, pressing the US toward a European-style regime of government control of consumers and businesses.

So my predictions for the year 2023 are based on the economics and psychology of politics, not the economics of consumer preferences and industry supply.

I doubt that the new Congress will pass sweeping antitrust reforms. Many Democrats appear to believe there is a political payoff from adopting laws that put government officials in control of what consumers can purchase and from whom, but that may not resonate with enough Republicans. On the Democrat side, there is clearly a desire for political control of business decisions, how markets are organized, and what consumers can choose. Democrat-elected officials and their constituents seem confident they can manage markets much like a chess player moves pieces around a board. What these “anointed” persons miss (to borrow Thomas Sowell’s word for them) is that people are not chess pieces—they have free will and know more than the anointed about the real world—and market processes and evolution are superior to government decision makers in their ability to learn and process copious amounts of data.

Generally, Republicans have a limited appetite for government controls, but some have signed on to Democrat antitrust reforms, apparently believing that large tech companies possess market power and have used it to diminish conservative voices on social media. The revelations coming out of Twitter support these beliefs. But some conservatives are recognizing that if social media content moderation practices are a problem, the problem exists regardless of whether a platform has market power. This insight means antitrust is not a remedy for content moderation problems. So, Republicans might find agreement on content moderation reform—although not in the context of antitrust reform—but Democrats are unlikely to agree with them, because Republican constituents want more liberty and Democrat constituents appear to want more control.

Absent legislation, courts will serve as constraints on leaders and agencies in the executive branch who see themselves as the anointed. I expect that the year 2023 will see FTC efforts to expand its role, but these ambitions will be inhibited by the practical problems of creating and enforcing rules for a rapidly evolving economy—and by some courts questioning if the FTC truly has such authority.

Also, some current antitrust cases in the US will struggle because competition is growing in the tech sectors. For example, the FTC’s case against Meta is likely to go nowhere as the company’s flagship products continue to lose ground with younger audiences. But if Congress succeeds in closing TikTok in the US, look for the current administration to use this as an opportunity to assert that the remaining social media companies would then have greater market power.

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