The Exit Interview with Jonathan Kanter

Key Takeaways

So, I was hoping AI would give me a full head of hair, but alas, You got a cooler picture than mine, though. I need to get one of those. Very cool. Uh well, thank you for having us. Um I think we'll have a brief conversation uh about uh little tech and how to protect little tech. And I want to start off by asking you um during your time uh at DOJ, what are the things that you did the best that helped little tech industry? Yeah, I think the best thing we can do is make big tech compete harder and provide more avenues for opportunities for um little tech companies and all tech companies to compete. So, we brought um you know, uh righteous um and uh principled cases against Google, Apple, but we also um brought cases involving United Healthcare, uh involving real estate algorithms, a wide range of areas where I truly believe we can we need disruption and innovation coming from new sources. And I think we will want to just want to create avenues um new startups, new businesses, new companies to emerge and go public. I want the Mag 7 to be the Mag 17. Uh if you had another year or if you were Gale Slater, what would you be doing right now on this front? Um we'd be fighting and winning our cases, which I hope they're going to continue doing for us um because I think uh they're strong and they're principled. Um I think there's a lot um we need to do um in the tech space. Uh I think there's a lot we need to do in the healthcare space. Uh agriculture and defense. I think those are the areas of the economy that um strike me as as the most concentrated and um necessitating the most um work from a competition perspective. And what do you think the next big case will be or the next big area? Um Maybe you know too much to answer that question. Yeah, well, I'll I'll I'll speak, you know, um based as as a as a private citizen now um based on my observations, but I think we So, we we brought a number of game-changing cases, whether it's um Ticketmaster or Apple or Google. And yeah, the United case, the Real Page case, the Visa case. I think we are we need to see those through, right? I mean, it's it's important to launch the cases, but it's just as important to litigate them and win. And really force change that looks forward. And so, I think there's a lot of work to do there. And then I think that if I were looking ahead, I think healthcare is the area that where I see the most surface area for interest in antitrust. You talked before about resources in terms of fighting Big Tech, but if if DOJ goes after healthcare, how do you think you get the resources to prosecute those cases against an industry that has just as much money as tech industry? Yeah, I think it's a it's a There are a few different dimensions to this. First is prioritization. And so, part of the job that I had to do was determine how are we going to take our scarce resources and invest them wisely on behalf of our client, which is the public. And we picked the biggest cases in the biggest industries that have the greatest impact on on the greatest number of people. And so, just case selection alone and how you manage your cases is really one way to manage to do that. Second is and I want to talk a little bit about government efficiency because it's something that's coming up quite a bit. I will tell you this. I ran the Antitrust Division for over 3 years. Each year, we ran it at zero cost to the taxpayer and with the budget surplus. We did it solely based on HSR Rodino merger filings. We ran it within our means, but we did it ambitiously and we did it efficiently and we did it with a sense of direction and purpose and that allowed us to use our resources. And we worked really hard and we did it with fewer people than the Antitrust Division had in 1979. Let me say though that we are still incredibly understaffed. We The Antitrust Division is still incredibly understaffed, and they need more resources in order to take on the world's largest monopolies. Because this is a a little tech conference, and obviously a lot of the great innovators that Y Combinator helps incubate, I will say that I think we need to look to technology in order to be more efficient. I think there's a lot we can do particularly on discovery, uh data analysis, using the new exciting tools that are coming out that are based on AI and other innovations in order to keep pace with the litigation workload. Back to Little Tech, how can Little Tech be protected right now during the AI revolution? So, my view is that antitrust is most important at the times of major technological transformation and change. It is to me not surprising that the heyday of the AT&T antitrust case we saw the emergence of IBM. At the heyday of the IBM antitrust activity, we saw the emergence of Microsoft. During the heyday of the Microsoft antitrust case, we saw the emergence of the internet and Google. When incumbents who are large and have these massive platforms feel threatened by new technological changes, they often invest not in in innovation, but in business practices designed to increase moats and make it harder for others to compete. My view is that is when antitrust is most important. It's most important to make sure that we're protecting the next opportunity for disruption and paradigm shifts, particularly in technology and network industries. And so, my view is that this is the most important time, and as we think not just about the cases we're bringing, but the remedies that we're going to ask for in an antitrust case it's absolutely critical that we look ahead to where the market is going and craft remedies and cases to make sure that the next technological change and shift is protected. Some Republicans would say that it's not the government's job to metal in the marketplace to protect an industry. What would you say to that? Antitrust is not a regulation it's law enforcement and we need lines on the road. You can't have competition without competitors and you can't have market markets without participants and so antitrust is about making sure that we have the the the excitement the motivation that flows from rivalry to to force us to motivate us to be better as a society. It is a surgical tool against the backdrop of an otherwise you know hatchet like regulation and I think what I hear a lot from folks right of center as well as left of center is that that if you can have strong antitrust enforcement in many instances will mitigate if not eliminate the need for invasive regulation. So Donald Trump and his some of his administration officials sort of talked the talk on Big Tech but then on inauguration day we all saw the Big Tech CEOs at the inauguration. What did you make of that? It was it was concerning bone-chilling not just because of the weather. It was it was frightening right? I think you know we talk about antitrust and corporate power because we want a just economy one that creates opportunity and freedom but corporate power can lead to political power and I think we've seen you know seeing those you know CEOs and you know in the Rotunda um, not just there you know, front and center, um, I think, you know, speaks volumes about the degree of of power that companies have. Um, I think, um, average citizens should have, um, as much if not more to say, um, than, you know, large CEOs of big companies. Uh, and I think if we want a democracy, we need to make sure that everyone has the opportunity to participate and if um, it it's quite a strong statement to see all these people outside freezing, um, and, um, while, um, you know, the people who, uh, run these big companies who have a lot to gain from government policy inside cozy and warm. Um, and in his first 2 months in office, what signs have you seen out of the FTC or DOJ that are positive or negative in terms of moving this agenda forward? Yeah, I mean, I listen, I think, you know, by and large directionally, I I remain very optimistic about the trajectory of antitrust enforcement, um, in part for the reasons we discussed, which is that antitrust is about lines on the road. It's about, um, you know, basic rules that, uh, are important for markets to function. It's about law enforcement rather than regulation. Um, I I think we have seen a transition from an ideology, um, that, um, viewed, uh, antitrust enforcement with hostility over the last few, um, administrations to one that has a is more in line with what I believe where I believe the public resides, which is that, um, holding big companies to account through antitrust enforcement, uh, when necessary, um, is a valuable and important tool and one that people care about. So, I remain cautiously optimistic, um, but, uh, I I also am mindful that, you know, each, um, leader of their agency, whether it's, uh, Assistant Attorney General Slater or, uh, Chair Ferguson will need to do it their way, uh, and that with their vision, um, and chart their own path, but I I think it's largely my hope is going to be largely consistent in terms of the trajectory, even if even if they do it in their own way with their own priorities. And along those lines, what do you think of the administration's proposal on Google remedies? So, we made a very strong proposal, and new administration largely maintained most of the core principles of that proposal. There were some tweaks, um but I I think You talked a lot about the importance of AI. Did they backtrack a little bit? They backtracked a little bit, which I was a little bit disappointed to see, but ultimately they have to, you know, make their own assessments and do what they believe is correct. I do firmly believe, however, that whatever remedies a court impose is in in an antitrust case, including that specific case, need to think about creating opportunities for competition in AI, and to make sure that query-based search, which is likely, you know, if you think about where query-based search competitors are going to come from, where the new advertising threats they're likely to come from companies that are building on AI stacks, and keeping the lanes of competition open for those companies is really important. You mentioned Andrew Ferguson last week or week before he was quoted in Axios as telling a bunch of bankers this is not the Bush administration. What do you think he meant by that? I think there's a sense, incorrectly in my view, that antitrust is a is a switch that flips on and off depending on who's in power, and it's just not it doesn't neatly divide along party lines the way perhaps some people think. And I will say that in my experience, when I was in office, I found a lot of support from folks who are right of center, and I also found disagreement from folks who are left of center from time to time. It just doesn't neatly divide along party lines. I think if you take a step back and you look at where the country is today, where the law is today, where lawmakers are today, where stakeholders are today in terms of the broader public, in terms of the entrepreneurial community, there's a lot of support for vigorous antitrust enforcement because it is seen as a lifeline for competition, entrepreneur opportunity growth at a time when we desperately need that, and it's seen as a pathway for innovation. You also talked about the about the lack of trust in experts these days. You gave an important speech I think last fall about that topic. Is there anything specific that can be done or have you seen any progress in that regard? There's a great book called The Wolves of K Street. I recommend everybody read it. And but but yes, I think you know, we need to distinguish between expertise and advocacy. And I think um I crave expertise. I think it's extremely important. But companies have done and Brody, you probably know more about this than maybe anybody on the planet, have done too much to co-opt and capture academia and expert voices in ways that distort the legitimate and free exchange of ideas in the search of truth. And I think we need to do a much better job and I delivered a speech which was effectively a call to action telling the industry that it is going to lose credibility permanently unless it gets its act together. And I think it's now or never. I think we have about a minute left, a little less than a minute. So in that time if done over since this is an exit interview what's one thing you would have done better and one thing you would have changed? So you know, when I when I look out ahead, I I I see all the things I wanted to do that we couldn't. Um, I think there's a lot more to do in health care. Um, and um, um, so you know, I wish we could have we could have gone faster. I wish we could have gone faster in in rebuilding our technology stack. Um, we got um, some money to do that. We worked quickly, but uh, there's a lot more to do. Um, and what was the other question? What what we could have Uh, what do you think the biggest mistake you made was? Oh. Um, uh, I feel like I used to always say when I was in office that um, there'll be time enough for counting when the dealing's done. And I feel like the dealing just finished, so I'm going to I'm going to wait and um, um, regroup on that later. All right. Yeah. Uh, well, thank you very much. Okay, thank you.