Congressional foes of the AT&T-Time Warner deal are in a bind: Celebrate the government’s skepticism, or fear Trump’s influence?
Fierce opponents of AT&T’s $ 86 billion bid to buy Time Warner now find themselves in an awkward political bind: They’re rejoicing over the fact that the U.S. government shares some of their doubts about the deal — but fear that President Donald Trump might have interfered in the process.
For the moment, the Department of Justice appears ready to force AT&T to sell CNN or potentially other TV networks owned by Time Warner in order to win the feds’ final blessings, a source familiar with the investigation confirmed to Recode. AT&T, for its part, seems ready to fight.
Normally, Democrats would be celebrating. After all, some have urged the government for months to toss the companies’ merger plans. But the Justice Department’s efforts are shrouded in controversy because of Trump. His repeated, public threats against AT&T loom over his administration’s regulatory review — an investigation that’s supposed to be independent.
And DOJ’s focus on CNN, in particular, left some on Capitol Hill wondering if regulators’ skepticism is real — or the stuff of partisan politics.
Sen. Al Franken, for one, told Recode in a statement Wednesday that AT&T’s bid to buy Time Warner would create a “massive corporation that would wield entirely way too much power, likely resulting in even higher prices, even fewer choices, and potentially worse service for consumers.” Much as before, he stressed they should be stopped.
But Franken wasn’t celebrating reports that DOJ had set its sights on CNN. He said he was “deeply concerned” that AT&T might have to spin off the company in order to proceed with the merger, “given the president’s repeated public complaints about CNN’s coverage of him.”
“Any indication that this administration is using its power to weaken media organizations it doesn’t like would be a profoundly disturbing development,” Franken said.
To the extent that it is a controversy, it’s one entirely of Trump’s own doing. His attacks on AT&T and Time Warner’s merger began during the 2016 presidential campaign, when he pledged he would reject the deal “because it’s too much concentration of power in the hands of too few.”
After entering the Oval Office, Trump’s threats appeared to intensify. Reports soon emerged that the president perhaps sought to use the combination of AT&T and Time Warner as leverage in pursuit of more favorable coverage by CNN.
As a result, lawmakers took aim when Trump nominated his first antitrust enforcer, Makan Delrahim. Before the Senate confirmed him to lead the DOJ division that is now reviewing the AT&T-Time Warner merger, Democratic Sens. Richard Blumenthal and Elizabeth Warren demanded commitments from Delrahim that he would not submit to the influence of the White House.
Complicating matters further were Delrahim’s own statements: Many months before taking his perch in government, he said the AT&T-Time Warner deal shouldn’t pose a major antitrust problem at all.
Fast forward to Wednesday: Delrahim’s agency unexpectedly seemed ready to force AT&T to make major changes to its merger plans — including, potentially, selling CNN.
To antitrust experts, it’s a demand that might have appeared tough but reasonable, if only Trump hadn’t talked about the deal in the first place.
“This is the cost of disparaging institutions,” said Harry First, a top antitrust professor at New York University School of Law, in an interview. “Normally, you would say, look here’s the Antitrust Division, they’re going to do their job, they should enforce merger policy.”
Given Trump’s comments, “no matter what they do, [he] has cast doubt on their good faith,” First said.
On Capitol Hill, meanwhile, the news led even the fiercest opponents of the AT&T’s proposed tie up with Time Warner to express wariness.
“The Department of Justice appears to be doing its job,” Blumenthal said in a statement. “I have long opposed this deal because of its impact on competitors and consumers.”
Without mentioning Trump, Blumenthal then appeared to acknowledge the tricky politics inherent in the DOJ’s latest move.
“I have also closely questioned Department of Justice officials about assuring the independence of CNN,” he said. “I am now counting on the Department of Justice to continue its thorough and exacting review, including its obligation to go to court and pursue legal remedies upholding market competition and First Amendment rights if the facts demand it.”
Another merger foe — Democratic Sen. Ed Markey — urged the Justice Department to take action against AT&T and Time Warner “using one lens only: will it result in substantial harms to competition and consumers.”
“The proposed merger already presents a number of potential problems for consumers, including higher prices, fewer choices, and poorer quality services,” he told Recode in a statement. But, Markey added: “The Department of Justice’s review process should be entirely void of politics. Any suggestion that the deal be conditioned on selling off a news channel because of its coverage is offensive to both the first amendment and the rule of law.”
And Sen. Brian Schatz, the top Democrat on his chamber’s telecom-focused Commerce Committee, offered his own doubts in the medium Trump himself knows best — Twitter.
“The burden of proof is on the Justice Department to establish that there is no political interference in their Antitrust Division,” he said.
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