President Biden’s pick to run the independent regulatory agency tasked with ensuring fairness in the market is under mounting pressure in Washington for bypassing ethical obligations, ignoring Congress and driving away her agency’s scores of employees and all of the Federal Trade Commission’s Republican commissioners.
The U.S. Chamber of Commerce has branded the FTC an agency “gone rogue” and said Chairwoman Lina Khan routinely oversteps the agency’s authority. It says it is fighting the agency because the business community is galvanized in opposition to Ms. Khan’s agenda.
“Because they have been so highly volatile in terms of their agenda it has required the Chamber for the first time in basically 40 years to stand up and say to the Federal Trade Commission, and to some degree the Department of Justice in the antitrust space, that this agenda is not consistent with the law,” said Sean Heather, the Chamber’s senior vice president for international regulatory affairs and antitrust.
“That this agenda is not consistent with due process and procedural fairness, and that this agenda is not an agenda that will be ultimately successful for the long-term economy of the United States,” he said.
The Chamber’s feud with the FTC reveals a larger rift emerging in Washington. The world’s largest business association entered the Biden era looking for inroads with the administration and rankled conservatives in the process.
The business group had enough of the FTC after Ms. Khan’s confirmation in June 2021. It sued the agency in 2022 on charges of withholding public records.
SEE ALSO: FTC leader bypassed ethics official’s recusal request on Meta case
Mr. Heather said differing views by the Chamber’s broad membership create challenges for picking sides but Ms. Khan’s actions united businesses in opposing her leadership.
“When all of a sudden you start to run an agency that is so one-sided in the way in which it approaches every issue, some of that has a tendency to galvanize people who realize that this is a dramatically different ballgame that’s being played,” Mr. Heather said.
More than 120 employees left within one year of Ms. Khan’s confirmation to the FTC, according to the House Energy and Commerce Committee. The congressional committee is one of three investigating the FTC.
Ms. Khan’s confirmation was hailed as a liberal victory early in Mr. Biden’s tenure. She received sizable bipartisan support with 21 Senate Republicans crossing party lines to vote for the anti-Big Tech crusader looking to make waves.
Ms. Khan, 34, is running an agency critical to Mr. Biden’s agenda, and she is accustomed to receiving praise for antagonizing her opponents. She was the subject of a fawning New York Times profile one year after graduating from law school for a scholarly article in which she criticized online tech giant Amazon.
Since taking the helm of the FTC, however, Ms. Khan has antagonized her colleagues, which has helped drum up congressional oversight. Christine Wilson, the agency’s last remaining Republican commissioner, announced her resignation from the commission in February. She accused the FTC of lawlessness under Ms. Khan’s direction.
Ms. Wilson cited the FTC’s challenge of Meta’s acquisition of the virtual reality platform Within Unlimited as an example of inappropriate action. A federal judge rejected the FTC’s case, and the agency later dropped its internal review.
Ms. Khan dismissed the advice of the FTC’s ethics official in deciding not to recuse herself from the Meta matter, which was revealed by internal documents obtained by Bloomberg and published on Friday.
That decision is likely to be scrutinized by the House Energy and Commerce Committee, whose chairwoman pressed Ms. Khan in April on whether she heeded the advice of the FTC’s designated agency ethics official.
“Are there any instances where you’ve not followed DAEO’s advice, yes or no?” Rep. Cathy McMorris Rodgers, Washington Republican, asked at a committee hearing. “Could you list any?”
Ms. Khan answered: “No. I’ve, in instances where companies like Facebook or Amazon have petitioned for my recusal, I have consulted with the DAEO and have taken actions that are consistent with the legal statements that the DAEO has made.”
Rep. Gus Bilirakis, a Florida Republican who leads the energy and commerce subcommittee that oversees the FTC’s budget, told The Washington Times that he and Ms. Rodgers are investigating several concerns about the agency under Ms. Khan’s leadership.
“E&C Republicans will continue to push back against government overreach, blatant abuses of power and obstruction of congressional oversight,” Mr. Bilirakis said in a statement.
Ms. Wilson’s departure from the FTC helped prompt House Oversight and Accountability Committee Chairman James Comer, Kentucky Republican, to announce this month that he was investigating whether the FTC had gone rogue under Ms. Khan and whether the departure from normal behavior was attributable to the influence of the White House.
The House Judiciary Committee is also digging into Ms. Khan’s work. The committee subpoenaed Ms. Khan in April for access to documents.
Ms. Khan’s approach to leadership was an eye-opener for those who closely watch the FTC’s work.
The Competitive Enterprise Institute’s Jessica Melugin said Ms. Khan’s effort to overhaul the agency’s work appeared reckless. Ms. Melugin is the director of CEI’s Center for Technology and Innovation and has closely scrutinized the FTC’s change in direction under Ms. Khan.
She said she was surprised by Ms. Khan’s strategy.
“You can’t just U-turn antitrust law of 40 years,” Ms. Melugin said. “If you’re sloppy like that and impatient like that, I think you risk undoing all you’re trying to accomplish.”
The FTC did not respond to requests for comment for this report.
Correction: In a previous version of the story, Lina Khan’s name was misspelled in the headline.
• Ryan Lovelace can be reached at rlovelace@washingtontimes.com.
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