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“THE DEPARTMENT OF JUSTICE'S WAR AGAINST CAPITALISM” mentioning the U.S. Dept. of Justice was published in the Senate section on pages S10530-S10531 on Sept. 17, 1998.
The publication is reproduced in full below:
THE DEPARTMENT OF JUSTICE'S WAR AGAINST CAPITALISM
Mr. GORTON. Mr. President, few of my colleagues would dispute the notion that capitalism is the foundation of America's economic success. Under capitalism, competition inspires innovation. Innovation led in the 19th Century to the industrial revolution, and in the 20th Century to the digital age. These developments have made the United States the richest, most successful nation in the world. But this Administration seems to distrust our capitalist, competitive system and wants to replace it with some sort of ``third-way'' in which government bureaucrats make major decisions about what innovations will be allowed in our economic system, and when.
I refer particularly, Mr. President, to the Justice Department's vendetta against Microsoft, a company that has had the ingenuity and determination to achieve the American dream. Against the odds, one man with a good idea turned a workshop in his garage into the most successful high technology company in the world. The Administration is now on a path to destroy not only the man and his company but to destroy the dream as well.
Assistant Attorney General Joel Klein, head of the Justice Department's Antitrust Division, has declare war on success in the name of antitrust law. According to Joel Klein's world view, it is the duty of the United States government to protect not the consumer but the company that cannot compete on its own merits.
Mr. Klein has made his ambition abundantly clear. When he testified before the Senate Judiciary Committee in June he said, ``We reject categorically the notion that markets will self-correct and we should sit back and watch.'' Instead, Mr. Klein believes the government should control every move of America's most successful and innovative companies.
What candidate for president ran on this platform? The American people were not informed that free markets were to be abandoned as our principal economic guide. Instead of allowing the best man, or in this case the best company, to win, the Justice Department wants to control the market and dole out slices of it to companies of its choice.
This is anathema to the free market, Mr. President.
The Department's case, after all, is merely an attempt to give Netscape and other Microsoft rivals a leg up in the ongoing battle for market share in the software industry. Microsoft has earned its current prominence in the software industry through hard work, innovation, and consumer choice. The company has been successful because it has had better ideas and more efficient means of turning those ideas into superior products. Consumers in the United States and throughout the world simply prefer Microsoft products.
But jealous rivals who have not reached the same level of success have now enlisted the Justice Department to give them what they and the Administration believe is rightfully theirs--more market share. These rivals, I fear, may soon regret ever having opened this Pandora's box. For a precedent may have already been set. That precedent is that government intervention in the market, in the absence of consumer complaint or dissatisfaction, is acceptable.
That is why I speak here today, Mr. President, as one in a growing number of voices in America in firm opposition to the Administration's case against Microsoft.
As I see it, the Administration is not working for the greater good, but for its own good. Those at the highest levels of this Administration believe they, not the market and certainly not consumers, know what is best for the nation. Rick Rule, former Assistant Attorney General for Antitrust under President Ronald Reagan, summed it up best when he said, ``The Hubris reflected in the government's case against Microsoft is monumental.''
This is just the beginning, Mr. President. Yesterday, at the Upside Conference, a meeting of high-tech industry leaders here in Washington, Roberta Katz, General Counsel for Netscape, said of the government's case against Microsoft, ``This is about a lot more than just Microsoft.'' To Ms. Katz I say, be careful what you wish for, be very careful what you wish for. Today the government's target is Microsoft, but tomorrow, it could very well be Netscape.
The Antitrust Division, in filing its case against Microsoft, is working to justify an expanded role for government in the high-tech industry. The further its tentacles are allowed to reach into high-tech market, the tighter its grip on the industry will become.
In fact, at a hearing tomorrow before Judge Jackson, the Justice Department will request that it be allowed to expand the scope of its case against Microsoft. There are two explanations for the Justice Department's motives; both are troubling. The first is that the Antitrust division is seeking to increase the aspects of the high-tech industry over which it will gain control if it wins the case. The second is that the Division is becoming increasingly desperate to find an issue, any issue, on which is can prevail in court.
The first point should be of no little concern to Ms. Katz of Netscape and her counterparts at all the other high-tech companies cheering the Justice Department on. But it is the second point on which I would like to expand.
The Antitrust Division knows that its case against Microsoft is literally falling apart at the seams. As my colleagues will recall, on June 23 a three judge United States Appeals Court panel overturned the preliminary injunction issued against Microsoft last December. The heart of the injunction, and the heart of the Department's current case against Microsoft, is the company's decision to integrate its web browser into its Windows operating system.
As soon as the Appeals Court ruled that the integration of browser technology into Windows as not a violation of U.S. antitrust law, Joel Klein started scrambling frantically for other claims to make against Microsoft. If the Administration's concern was truly that Microsoft was acting illegally in integrating products into Windows, the Justice Department would have and should have dismissed its case then and there. But it didn't.
Joel Klein continued attempts to drag more and more issues into the case is telling, Mr. President. Those attempts are a clear sign that the government's real beef with Microsoft is its size. The government can't stand the fact that Microsoft is successful. Microsoft, in the eyes of the Administration, is just too big. So the Justice Department will do everything it can to paint Bill Gates as the bad guy.
As Holman W. Jenkins, Jr. aptly described it in an editorial in Wednesday's Wall Street Journal, Joel Klein ``has spraypainted the world with subpoenas, calling companies to testify about every failed and not-yet-failed collaboration between competitive allies and allied competitors in the computer industry.''
the strategy, according to Rick Rule, is ``the old plaintiff's trick of throwing up lots of snippets of dialogue that try to tar the defendant as a bad guy.''
Aside from all the legal commentary, the real issue, Mr. President, is that the Justice Department's case against Microsoft is a bad one. Joel Klein knows it, the high-tech community knows it, and I know it.
No legal wrangling can disguise the fact that what the Administration is doing is wrong. It is not only wrong in the sense that the Justice Department will probably lose in the end. But it is wrong in the sense that the very premise on which it stands is at fundamental odds with the free market capitalism that has made this nation great.
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