The U.S. Department of Justice last week accused Apple and five of the nation’s largest published of violating federal anti-trust law.
In announcing a lawsuit against Apple and the publishers, Attorney General Eric Holder alleged these companies engaged in a “conspiracy” to illegally price e-books so that “consumers paid millions of dollars more for some of the most popular titles.”
The benefit of antitrust law has long been questioned. As Murray Rothbard pointed out, “Antitrust laws and prosecutions, while seemingly designed to “combat monopoly” and “promote competition,” actually do the reverse, for they coercively penalize and repress efficient forms of market structure and activity.”
While the facts of this case will have to be examined in more detail before the merits of the case can be accurately judged, one statement by Holder points to a motivation behind the lawsuit that might have led to the DOJ pursuing a questionable case.
“The Department of Justice is committed to ensuring that e-books are as affordable as possible,” said Holder.
Of course, it isn’t the job of the DOJ to keep e-books affordable.
According to the Wall Street Journal, the DOJ isn’t alone in this concern. “A group of 16 states, led by Connecticut and Texas, filed their own suit Wednesday against Apple, Macmillan, Penguin and Simon & Schuster,” the Journal reported.
This brings up other questions apart from the merits of the suit. Why are Texas and other states pursing a case in which all the activities under investigation appear to be interstate in nature? Additionally, what benefit is there from having multiple jurisdictions pursuing the same case?
Texas is also pursuing another antitrust investigation of Google, and of course many states were involved in the effort to keep Microsoft from giving away its browser and other products free of charge back in the 1990s.
While the Foundation is a strong backer of the states’ Tenth Amendment rights, it would seem like the Founders put the Commerce Clause in the U.S. Constitution exactly for situations where multiple efforts to assert regulatory authority over the same activity generally do more harm than good.
We’ll see whether the DOJ and the states can make good cases for their respective lawsuits.