Will M&A Die Under Obama or Clinton?

Posted by Heidi N. Moore, May 29, 2008, 2:48 pm
Deal Journal, WSJ.com

While Barack Obama predicts his own victory in the Democratic presidential primaries as of June 3, deal makers fret about whether a Democratic administration would mean never being able to do a big M&A deal again.
US Airways and United Airlines, for instance, said today that they are pedaling as fast as they can to get a deal done before the Bush administration leaves. Are their fears justified?
If you go by the rhetoric, yes.
Both Obama and Democratic rival Hillary Clinton have indicated they don’t see antitrust matters as loosely as they accuse the Bush administration of doing. Obama has been more outspoken, criticizing the Bush administration for what he sees as lax enforcement of the nation’s antitrust laws. Clinton has been less so.
Here is Obama’s first salvo: “We live in a globalized economy and we probably have to update how we approach antitrust to figure out what is truly uncompetitive behavior on the part of monopolies or oligopolies and what are just big successful companies that need to be big in order to compete internationally….Some of the consolidations that have been taking place, I think, may be anticompetitive….We’re going to have an antitrust division in the Justice Department that actually believes in antitrust law. We haven’t had that for the last seven, eight years.”
Of course, Obama is campaigning, and on a Democratic platform you would expect him to talk tough on mergers. The Clinton Administration gave Microsoft a heck of a time, for instance. But some believe that the important courts right now will still be staffed by Republican judges who may not be amenable to antitrust challenges.
Hillary Clinton is a little harder to read. Her only stance on antitrust has come in the form of comments against OPEC. She has promised to amend antitrust law to confront OPEC and has threatened repeatedly to confront the cartel through the World Trade Organization.
But as first lady in the ’90s, Clinton tried to encourage hospitals to communicate with each other as part her push for universal health care; she also promised to dial down any antitrust enforcement that would prevent hospitals from sharing information with each other.
Of course, the antitrust stances of these two candidates don’t extend to their own interests: there is, after all, rampant speculation about a merger of their two campaigns.