The Neo-Brandeisian conception of antitrust touted by Federal Trade Commission Chair Lina Khan and others can be boiled down to “big business is bad.” Their response, in short, is to develop a complex regulatory regime that prevents the ills associated with that bigness.

　　This approach suffers from at least two flaws: first, it assumes that regulatory costs will hit the biggest corporations the hardest; and, second, and relatedly, it neglects to consider that a larger regulatory state is also a threat to liberty and our constitutional order. Neo-Brandeisians need not give up on their strategy—they need only recognize that fighting corporate giants also requires slaying government behemoths.

　　A few examples illustrate the Neo-Brandeisians’s flawed focus on bigness. A soon-to-be proposed rule on “commercial surveillance” would subject corporations to a litany of fine-sounding requirements. If and when finalized, the rule may force corporations to adhere to data collection standards, consumer consent requirements, and data security obligations. These requirements, though, would add to the preexisting patchwork of state privacy laws. Small businesses already struggle to comply with such varying standards. The addition of even more regulations will only saddle the very businesses Khan is counting on to increase competition.

　　Similarly, the proposed trade regulation rule on unfair or deceptive fees, when finalized, will tackle common consumer concerns around “junk fees.” As proposed, the ambiguous language in the rule renders compliance trickier and, by extension, more expensive. The latest draft of the rule includes a ban on excessive or worthless fees. Even the FTC acknowledges that such vague language would result in regulatory uncertainty and greater compliance costs. While such proposals may sound good in a law review article or op-ed, in practice, these and other regulations impose comparatively fewer costs on the big businesses they supposedly target.

　　American firms pay upwards of $300 billion a year to comply with the latest rules and regulations. Some firms, though, pay far more than others. The extent of the disparities in compliance costs by the size of the firm requires thinking through how firms actually go about complying with the latest government mandate. More than 90 percent of compliance costs are tied to labor. An accurate assessment of a regulations compliance costs, then, should turn on analysis of the labor hours and wages required to toe the new line. Based on that framework, economists estimate firms with around 500 employees incur nearly 50 percent more in compliance costs than smaller firms (fewer than 50 employees), but they also pay almost 20 percent more than large firms (more than 500 employees). By taking a labor-focused approach to analyzing regulations, this disparity might be lessened. This approach should also cause Neo-Brandeisians to pause before rushing ahead with regulations meant to bring down corporate giants that, once implemented, only serve to entrench and expand their bigness.

　　A more expansive administrative state benefits big businesses that can afford to capture staffers and submit comment after comment in rulemaking processes. A look back at the informal meetings held by EPA staffers from 1994 to 2009 reveals that industry groups were almost always the other attendees—in comparison to public interest outfits, industry groups tallied 170 times more informal communications with the agency. In addition to holding a near monopoly over staffers’ time, industry groups fill up an agency’s record in the rulemaking process by submitting the vast majority of comments during notice and comment periods. When the EPA sought input from the public on an air pollutants rule, industry groups filled the information void—submitting more than 80 percent of the comments received by the agency.

　　Increased regulation and, consequently, a larger administrative state undermines the democratic ideals that Neo-Brandeisians allegedly seek to advance. Congress alone, per Alexander Hamilton, must “prescribe[] the rules by which the duties and rights of every citizen are to be regulated.” Though Congress is far from a perfect institution—it’s the institution the Framers intended to wield legislative power because its members are directly accountable to the people. Administrative agencies, in stark contrast, cannot claim to operate with the elective consent of the people.

　　What’s the point of encouraging people to vote and lowering barriers to the ballot if the people’s representatives are simply going to hand their legislative powers to unaccountable bureaucrats?

　　Neo-Brandeisians have avoided answering that question—opting instead to prioritize their policy preferences over their democratic principles. The noncompete ban recently finalized by the FTC will impact 30 million contracts and affect some of the most important industries in our economy. It’s true that the FTC afforded the public a couple of comment windows to make their voices heard, but those comment windows are far short of the kind of participation, transparency, and accountability that should be at the foundation of our constitutional order. What’s more, that rulemaking effort—including the agency costs to draft it, refine it, and finalize it as well as the regulatory ambiguity it has already sparked—is likely all for naught. Legal scholars anticipate that the legal challenges filed immediately after the finalization of the rule will succeed. In fact, administrative and antitrust lawyers list several compelling reasons, including the Major Questions Doctrine, why the rule will not stand.

　　Today’s FTC has accumulated much more power than anyone could have anticipated.

　　A few changes to the Neo-Brandeisian approach could avoid such harmful outcomes. The Neo-Brandeisian impulse to preserve individual liberty by fighting corporate bigness aligns with the Founders’ fear of too much power concentrating in any set of hands. Their solution—toconcentrate power in the hands of unelected bureaucrats—undermines their good intentions. An alternative solution would be three-folded: first, actively consider how compliance costs will affect small, medium, and large businesses (and only move forward regulations that will not entrench the dominance of corporate giants); second, eliminate existing regulations and alter current processes that benefit those giants; and third, acknowledge that a smaller government is a more accountable government by restoring Congress’s intended role as the sole legislative actor.

　　Justice Louis Brandeis would applaud the Neo-Brandeisians realizing that concentrated power in the hands of any actor is problematic. He long ago warned that experience should teach us to be most on our guard to protect liberty when the Government’s purposes are beneficent. Adherence to Brandeis’s guidance would not only safeguard liberty but also align with the original understanding of the FTC’s purpose and function.

　　The FTC was never intended to be a rival to Congress. George Rublee, one of the first FTC Commissioners and the author of Section 5 of the FTC Act, regarded the agency as having significant, yet finite powers. Rublee conceived of the FTC as having “broad powers of investigation and report and facilities for making an expert and impartial study of such questions” relating to unfair methods of competition. As an “expert and impartial commission,” the results of those studies would “have weight and in this way progress might be made in bringing our statutory and case law into harmony with economic law.”

　　Today’s FTC has accumulated much more power than Rublee or anyone in 1914 could have anticipated. It can and should return to operating more as an impartial investigator and informant rather than a rival policymaker. A return to this conception of the FTC by a clarifying amendment of the FTC Act would comport with its original purpose and increase the odds of it influencing responsive congressional activity. The alternative—continued efforts by the FTC to invade Congress’s legislative realm—is untenable.

　　Our constitutional order is not efficient. It was not intended to be. Difficult decisions about how to regulate the most important industries must be left to the people and their representatives. Few question that Khan has good intentions, but those intentions do not justify the FTC operating as a philosopher agency.