Healthcare Antitrust, Settlements, and the Federal Trade Commission by Langenfeld James;Galeano Edwin;

Author:Langenfeld, James;Galeano, Edwin;
Language: eng
Format: epub
Publisher: Emerald Publishing Limited
Published: 2018-08-14T00:00:00+00:00

Threats to the Bureau from Outside: Congress and the White House

Focusing a bit more directly on the Bureau of Economics or its predecessor Division, the 1920s saw formal Congressional efforts to constrain the Commission’s economic work by restricting or eliminating funding for the Economic Division as Congressman Wood, Chairman of the House independent agency oversight committee, said that the Division’s Chief Economist, Francis Walker, did little but “promulgate a lot of wild-eyed theories and idealism.”365 In 1926, riders were put in place that restricted the use of funds for economic studies unless a law violation was alleged or both Houses of Congress requested the study.366 This type of restriction was imposed to reduce the likelihood that unpopular FTC reports would be forthcoming and to stop the Senate alone from having the ability to request FTC reports. The FTC Chairman at the time, William Humphrey, approved of such restrictions because he was pursuing a policy of business/government cooperation367 that was inconsistent with the previous FTC practice of publicity and reporting (some would have called it anti-business crusading). The rider was removed after 1928, and in any event, it would have had little effect because a study could be undertaken if a law violation was alleged and that would have been relatively simple to accomplish.

A few years later, additional efforts to restrict general investigations surfaced. In early 1933, the FTC’s budget was cut in half by the House Appropriations Committee, apparently to deter the beginning of new, and costly, economic investigations.368 That Committee cut never became effective, but new Congressionally-requested investigations were effectively limited by a rider which was put in place in 1933 just before the completion of the chain store report and utility report.369 The rider was attached to the 1934 appropriations bill amending section 6a of the FTC Act permanently, requiring a two-House concurrent resolution to initiate a Congressionally-requested investigation. According to Stevens (1940), this rider went a long way toward eliminating investigations at the behest of Congress, since individual Houses could no longer initiate a study.370 At the time, the restriction was important, because it was not clear that the Economic Division had any work to do if Congress did not request reports.371 Regardless of the precise restrictions, it is clear that certain members of Congress were interested in constraining the initiation of FTC investigative reports, and they focused upon the Economic Division for budget cuts in the 1930s and 1940s.372 Later on, Congress imposed various restraints on spending for particular studies. For example, appropriations riders stopped a 1953 study on consumer expenditure (this report had been requested by President Truman in Fall 1952) and an early 1960s study of the products, finances, and ownership of the 1,000 largest U.S. firms.373

The Bureau also felt a shock wave that accompanied release of the International Petroleum Cartel report. This 900-page report was completed in October 1951, but due to certain sensitive material in the report and due to political unrest in the Middle East, it was withheld by the White House at the request of the State Department.

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