The Yellow Rose of antitrust

Politico

12 hours ago

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Quick Fix
Ken Paxton's bid to unseat Sen. John Cornyn in a GOP primary is the latest chapter in a battle between pro-Trump upstarts and old-line Republicans for control of Washington. When it comes to antitrust policy, the powerful — and oft-embattled — Texas attorney general is already making his presence known.
'From an enforcement policy standpoint, what the Republicans were doing in Texas is now what the Republicans are doing in Washington,' said Michael Keely, who chairs the antitrust practice at the law firm Axinn, Veltrop and Harkrider.
Texas law affords its state attorney general considerable authority when it comes to competition policy and consumer protection, and Paxton has taken a broad view on how those powers can be put to use to advance MAGA-friendly political priorities.
The Texas AG was recently backed by Federal Trade Commission Chair Andrew Ferguson and Assistant Attorney General for Antitrust Gail Slater in a lawsuit targeting large asset managers for allegedly disrupting coal production in their pursuit of environmental, social and governance initiatives. Paxton's investigation into alleged collusion among advertising firms was cited by the FTC chair in a recent decision allowing the ad giant Omnicom to purchase its rival Interpublic — so long as the firms swore off any future effort to steer ad dollars from publishers for political or ideological reasons.
Notably, several Paxton alums are now in prominent roles at the White House National Economic Council (Paige Willey, Ryan Baasch), DOJ's Office of Legal Counsel (Lanora Pettit), the Department of Homeland Security (Joseph Mazzara) and the upper echelons of Vice President JD Vance's policy shop (James Lloyd — the former head of the Texas AG's antitrust division).
'Personnel is often policy,' said Keely, who has written about how Paxton could become a driving force for antitrust policy in Trump 2.0. 'The people setting policy have done an interesting job — including the Texas people — of building up what I would consider to be an antitrust intellectual framework around issues that have been more associated with Trump's political' priorities, he added.
Still, Paxton's playbook risks creating some political headaches for President Donald Trump's team.
Paxton's efforts to police ESG initiatives at asset management firms, for instance, could limit resources for the very industries that the president has sought to elevate. The Texas AG's lawsuit against BlackRock, State Street and Vanguard over their coal holdings requested a court order that would require the investment companies 'to divest from coal or restrain them from limiting coal production or competition.'
As the WSJ's editorial board said, it would be hard to boost coal production in the U.S. if three of the largest asset managers in the world were forced to unload their coal company shares.
IT'S MONDAY — If you have thoughts on how the Trump administration is navigating antitrust and merger policy, I'd love to hear from you. And as always, send MM tips and pitches to me at [e-mail].
Driving the Week
MONDAY …
TUESDAY … The NFIB's Small Business Optimism Index is out at 6:30 a.m. … House Financial Services Subcommittee on Financial Institutions holds a hearing on 'Main Street or Mandates? How Dodd-Frank Closed the Door on Financial Opportunities' at 10 a.m. … The House Financial Services Task Force on Monetary Policy holds a hearing entitled 'Less Mandates. More Independence' at 2 p.m. … The Federal Reserve's report on consumer credit is out at 3 p.m. …
WEDNESDAY … Senate Banking holds a hearing on 'From Wall Street to Web3: Building Tomorrow's Digital Asset Markets' at 10 a.m. … House Financial Services Subcommittee on Capital Markets holds a hearing on the costs and consequences of Dodd-Frank at 10 a.m. … The Chamber of Commerce holds a virtual discussion on 'Trade Wars and the Cost of Doing Business' at 1 p.m. … The House Financial Services Subcommittee on Housing and Insurance holds a hearing on the housing shortage at 2 p.m. … The Federal Reserve meeting minutes for June will be released at 2 p.m. …
THURSDAY … The Brookings Institution holds a discussion on 'Can Trump Bring Manufacturing Back to the U.S.?' at 10 a.m. … Fed Gov. Christopher Waller will speak at a Federal Reserve Bank of Dallas and World Affairs Council of Dallas/Ft. Worth event at 12:30 p.m. … The Bipartisan Policy Center holds a virtual discussion on the economic effects of rent regulation at 2 p.m. …
FRIDAY … Treasury's monthly budget statement will be released at 2 p.m. …
Deadline approaching? Maybe? — As the countdown to Trump's July 9 deadline to impose punishing 'reciprocal' tariffs on dozens of trading partners, Treasury Secretary Scott Bessent told CNN's State of the Union that the new rates won't take effect until next month. 'If you don't move things along, then on Aug. 1 you will boomerang back to your April 2 tariff level,' he said.
— Trump isn't sweating that he has yet to deliver on major trade deals with just days to go, Daniel Desrochers and Megan Messerly report. 'We can do whatever we want,' the president said last week about Tuesday's deadline for countries to reach deals — or face punishing new tariffs. 'We could extend it, we could make it shorter. I'd like to make it shorter.'
AWOL — As first reported in Playbook, Commerce Secretary Howard Lutnick was supposed to join EU Commissioner for Trade and Economic Security Maroš Šefčovič on Thursday for a meeting as Europe negotiates a trade deal with the Trump administration, but Lutnick had already left town to go on vacation with his family in Italy, a person familiar with the matter told POLITICO's Daniel Lippman and Daniel Desrochers. Instead, Bessent said he was meeting with the EU as the deadline for Trump's pause on his so-called reciprocal tariffs is due to expire next Wednesday. Bessent canceled a family July 4 trip to Wimbledon and the Henley Royal Regatta to get Trump's tax and spending legislation across the finish line and work on trade deals, according to a person familiar with the matter. On Thursday, he also did five media appearances, including all three business networks.
'Secretary Lutnick met his wife and family for a July 4th trip,' a Commerce spokesperson said in a statement to Playbook. 'He has been on nonstop calls working for the American people and plans to be back in DC this weekend. President Trump's deal announcement with Vietnam earlier this week proves that Sec. Lutnick continues to level the playing field for the American worker.' A Treasury spokesperson declined to comment.
At the White House
Contradictions — Trump signed the One Big Beautiful Bill into law on July 4. The measure is chockablock with new tax breaks for 'venture capitalists, Alaskan fisheries, spaceports, private schools, rum makers and others,' reports Brian Faler.
— While GOP heavyweights spent decades trying to simplify the tax code. Trump's signature piece of domestic policy legislation did the opposite, writes Victoria Guida. 'The result was a sprawling and quirky piece of legislation that is distinctively Trumpy: lower taxes and a bigger pile of tax breaks.'
— ICYMI: The legislation allocates tens of billions of dollars for deportation and border patrol efforts.If that hastens the decline in the size of the foreign-born workforce, the economy could slow.
— The effects on health care could be profound, according to The WSJ's Dominique Mosbergen, Joseph Walker, Liz Essley Whyte and Josh Ulick: 'Millions of people will lose health-insurance coverage, and struggling hospitals across the country may have to close, lay off staff or shut down some services, they say. States will also face difficult budget choices as federal funds are reduced.'
— White House officials say they are bullish on the economy's trajectory now that OBBB is law. 'It's the same combination of policies, tax cuts, deregulation, trade renegotiation, and energy abundance that gave us astounding economic growth in the president's first term, 2.8 percent until the pandemic,' Council of Economic Advisers Chair Stephen Miran said on Sunday. 'And that's exactly what we forecast again, very similar numbers.'
On The Hill
The next big bill — The scheduled cuts to the social safety net imposed by OBB are setting the stage for massive political battles in 2026 and 2028, writes Benjamin Guggenheim.
Zelle — From Katherine Hapgood: 'Democratic lawmakers in a letter released Thursday called on the banks that own Zelle to provide information on how they will monitor and handle social media scams on peer-to-peer payment platforms.'
First in MM: Bipartisan legislation sanctioning Russia — House Financial Services members Reps. Zach Nunn (R-Iowa) and Josh Gottheimer (D-N.J.) will introduce legislation today that would impose sanctions on Russia by restricting the opening or maintaining of correspondent or payable-through accounts by certain foreign financial institutions, Katherine Hapgood reports.
The bill is expected to be marked up by the committee.
'As a combat veteran and former intelligence officer, I know that words alone will not bring the Russians to the table,' Nunn said. 'This bipartisan bill puts teeth behind our message, cutting off the financial lifelines that fund Putin's aggression without costing the taxpayer a cent.'