The US Federal Trade Commission (FTC) has recently blocked Tapestry’s $8.5 billion acquisition of Capri Holdings, bringing Chair Lina Khan’s strict antitrust measures back into the spotlight.
Khan, with her uncompromising stance on monopolistic takeovers is often raising concerns within business circles and is also a frequent target of congressional Republicans, who accuse her of being overly aggressive in enforcing antitrust laws.
Now, in the run-up to the US elections, Khan has also been seen appearing at events with prominent Democrats, and while Democratic Senate candidates across Arizona, Texas, and Illinois are vocal in their support for FTC chair, Democratic nominee Kamala Harris has notably refrained from campaigning with her, creating tension within the party.
The progressive faction of the party is faulting Harris for not openly siding with Khan or defending her even as the FTC chair battles opposition from not just Republicans but influential businessmen who are supporters of the Democrat party.
Harris faces donor pressure as tech moguls oppose Khan
In a letter to a GOP lawmaker last year, Khan noted that under her watch, the FTC has taken action against 38 mergers since June 2021, and that companies have abandoned 14 mergers during FTC investigations.
These include tech giants like Nvidia, Meta, Microsoft, Apple, and Amazon.
At the center of Harris’ dilemma are her prominent supporters like billionaire Mark Cuban and LinkedIn co-founder Reid Hoffman, who have voiced their opposition to Khan.
Recently, Cuban said he believed the Democratic nominee should replace Lina Khan as head of the Federal Trade Commission.
These influential backers argue that Khan’s hardline approach could stifle innovation and investment in the tech sector.
“The bigger picture is, she’s hurting more than she’s helping,” Cuban told Semafor.
Hoffman, on the other hand, who has donated millions to the Democrat campaign, has said that Khan is “waging war on American business.”
Hoffman is under FTC investigation concerning his involvement with companies like OpenAI and Inflection AI, and a Microsoft investment that allegedly circumvented FTC scrutiny.
Harris’ choice to keep a cautious distance from Khan is being seen as a response to these influential figures, who have expressed hopes that Harris might dismiss Khan if she wins the presidency.
By doing so, Harris would signal a shift toward a more business-friendly stance, distancing herself from the stronger antitrust measures enacted under President Joe Biden.
Progressive backlash over Harris’ distancing from Khan
On the other hand, Khan’s supporters, largely from the progressive faction of the Democratic Party, view her agenda as essential to reining in corporate power.
They argue that Harris’ failure to align herself with Khan’s antitrust mission could weaken the party’s base, especially among voters frustrated with economic inequality and large corporate influence.
In a report by POLITICO, Hal Singer, an economist at the University of Utah, cautioned that Harris’ refusal to defend Khan “zaps the life out of the progressive base” and could be a missed opportunity to claim a populist stance.
Jeff Hauser of the Revolving Door Project echoed these concerns in the report, warning that Harris’ attempt to attract moderate Republicans may be undermining the populist energy Democrats need to counter Donald Trump.
Harris’ stance risks populist votes, analysts warn
For Harris, walking a fine line between populist calls for corporate accountability and the business interests of her donors has become a central balancing act of her campaign.
Harris’ campaign team maintains that her economic policies include measures to increase taxes on billionaires and curb price gouging, aligning with aspects of Biden’s economic platform.
However, progressives argue that these measures may fall short of the bold antitrust stance represented by Khan, whom they see as an essential counter to corporate power.
A poll conducted by Lake Research Partners showed that over 65% of voters in key swing states support lawsuits aimed at curbing monopolies, signaling a broader public approval for the FTC’s objectives.
Critics warn that Harris’ approach could allow Trump to capture the populist narrative by positioning himself as a defender of ordinary Americans against corporate excess.
However, some experts have sought to dismiss the importance of a Big Tech pushback as a valid poll concern.
Adam Kovacevich, former Google executive and head of the tech lobbying group Chamber of Progress, pushed back on the idea that voters are rallying behind Lina Khan’s aggressive stance against Big Tech’s market power.
“The anti-corporate left overestimates the size of its voter base,” Kovacevich said.
He told POLITICO that the Biden administration “lost alignment with the median voter on economic issues,” and that Harris is now working to win over moderates who are wary of Trump but also view her as potentially too economically radical.
“She’s framing her messaging and approach to business differently because that’s what swing voters want to hear,” Kovacevich explained.
The future of antitrust enforcement in a Harris administration
Despite her reluctance to openly champion Khan’s policies on the campaign trail, Harris is still expected to retain Khan as FTC chair if she wins.
Much of the Biden administration’s anti-corporate agenda, according to analysts, remains woven into Harris’ platform, even if she is not prioritizing it in campaign rhetoric.
Dan Geldon, former chief of staff for Senator Elizabeth Warren, commented in the POLITICO report that the “success of Bidenomics” would likely encourage a Harris administration to uphold the legacy of Khan’s tenure at the FTC.
Harris’ critics, however, argue that by not rallying around Khan now, she risks alienating progressive voters and could miss a vital opportunity to distinguish herself from Trump on issues of corporate accountability.
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