FTC Confirmation Hearings Promise a Return to Bipartisanship

Those who were looking for big fireworks at yesterday’s confirmation hearings for three FTC Commissioners were likely disappointed by the relatively business-as-usual nature of the proceedings. Yes, certain Senators decried the low morale at the agency, alleged ethical breaches, continuing telework, and loss of the FTC’s characteristic bipartisanship. However, those remarks were not unexpected and were generally directed at Chair Lina Khan, who was in the audience but not in the witness chair.

For the most part, the hearing was about restoring bipartisanship, and the FTC nominees (current Democratic Commissioner Rebecca Kelly Slaughter and Republican nominees Andrew Ferguson and Melissa Holyoak) all pledged earnestly to do so. They also appeared to agree on most issues, although the devil will be in the details if and when they are confirmed.

The Nominees

Rebecca Kelly Slaughter is being considered for a second term, having served at the FTC since 2018. In her opening statement, she stressed the benefits of bipartisanship and of considering different viewpoints, and said she would welcome Holyoak and Ferguson to the FTC line-up. Although Slaughter took fire on some issues, the fire was mostly directly at Khan as noted, and Slaughter was well-prepared to handle it.

Melissa Holyoak is currently the Solicitor General (SG) of Utah. In her opening statement, she echoed the bipartisanship theme, as well as the important role of the FTC on issues that impact consumers’ daily lives. She zeroed in on the privacy and safety of children as a particular area of focus if she is confirmed. She also cited her work to date on cases to rein in the big tech companies, as did Ferguson.

Andrew Ferguson is the SG of Virginia. In his opening statement, he discussed the importance of the free enterprise system, but said that it only works if it’s protected from fraud and monopolies. He stressed bipartisanship but also stated that agencies like the FTC need to ​“enforce the laws as Congress has written them, respect the separation of powers, and obey the constraints Congress imposes on their authority.”

All of the nominees brought their families to the hearing, and Sens. McConnell (R-KY) and Lee (R-UT), who are not Committee members, made guest appearances to introduce Ferguson (who had worked for McConnell) and Holyoak (who collaborated with Lee on issues affecting Utahans). Lee mentioned that Holyoak would bring litigation experience to the FTC that its current members lack.

If the nominees are confirmed, the FTC would have a full complement of five Commissioners (three Democrats and two Republicans) after operating for six months with just three Democrats (following the fiery resignation of former Commissioner Christine Wilson).

Opening Statements from the Chair and Ranking Member

Chair Cantwell (D-WA) invited Ranking Member Cruz (R-TX) to start the hearing, and start he did by railing against the FTC – saying that its current political approach departs from its bipartisan traditions; that it has weaponized law enforcement, undermined mergers, and engaged in unprecedented regulation; that it has destroyed documents and conspired with the EU on regulations; and that it has interfered with free speech and innovation. He also discussed the dramatic drop in morale under Khan’s leadership. Cruz concluded his remarks by stating that the FTC must restore bipartisanship. He also said later that all of the nominees are well-qualified, suggesting that all of them will ultimately get his vote.

Chair Cantwell emphasized the important role of the FTC in fighting fraud, dealing with the harmful effects of consolidation (including high prices and supply chain issues), protecting privacy, and tackling concerns related to AI and PBMs. Not unexpectedly, she made clear that she would vote for Slaughter.

Questions

The Q&A suggested surprising agreement among the nominees on most issues, though there were differences in emphasis and they spoke in generalities, as nominees typically do. Here’s a quick run-down of the highlights, with the Senator(s) who did the main questioning on each issue noted in brackets. Note that not every nominee answered every question.

  • Restoring the FTC’s Section 13(b) authority. [Sen. Cantwell] All nominees said they supported it, and generally indicated they would do so without limits, though Ferguson left himself a little wiggle room.
  • Action against abuses by PBMs. [Sen. Cantwell] Slaughter said she supported such action. Ferguson and Holyoak said they want to see the results of a PBM study now underway, but generally support action here.
  • Disregard of ethical advice. [Sens. Cruz and Sullivan (R-AK)] The underlying facts here are fairly detailed but, in short, there’s a dispute about whether Khan disregarded advice from an FTC ethics official to recuse herself in the Meta-Within matter, and whether Slaughter and Bedoya voted to shield the facts from the public. While the Senators directed their questions to Slaughter, their ire (again) seemed directed at Khan. Cruz also said that the FTC had not responded to his letters and had deleted emails sought by Congress.
  • Role of FTC in fighting robocalls. [Sen. Tester (D-MT)] Holyoak and Ferguson agreed this is an important problem. Slaughter said the FTC needs to focus on the ​“pipes” – e.g., by targeting VOIP services that enable robocalls.
  • Regulation of AI. [Sens. Thune (R-SD) and Blackburn (R-TN)] Questioned about the FTC’s authority to regulate AI, Slaughter said that existing laws apply to new technology, but that additional legislation would be needed to go beyond those laws. Ferguson and Holyoak agreed, emphasizing that any ​“grand scheme” to regulate AI should be left to Congress. All said they would stay within the bounds of the law in addressing AI.
  • Section 230. [Sen. Thune] All nominees said they supported removing Section 230 immunity from suits by the government.
  • FTC’s role in privacy [Sen. Hickenlooper (D-CO)] All nominees said they supported federal privacy legislation, though Slaughter emphasized the need to use existing tools until that happens, and Holyoak and Ferguson emphasized the need for Congress to set the standards here.
  • Merger review workload. [Sen. Klobuchar (D-MN)] Ferguson and Holyoak agreed that the volume is concerning.
  • Whether the FTC should table the FTC’s rulemaking until Congress provides clear legislative authority on privacy. [Sen. Blackburn] Holyoak and Ferguson both said yes. Slaughter said no.
  • Privacy protection for kids and teens. [Sens. Markey (D-MA) and Schmitt (R-MO)] All nominees said they supported strong protections in this area, and agreed, in response to Markey, that targeted advertising ​“can be” inherently manipulative for kids and teens. Holyoak mentioned that she has particular concerns about Ed Tech companies that force children to give up their privacy.
  • Data broker regulation. [Sen. Peters (D-MI)] Asked about the value of a federal data broker registry, all nominees said that greater transparency in the industry would be a good idea. Slaughter mentioned the FTC’s case against data broker Kochava, as did Holyoak, with apparent approval.
  • Considerations of race, sexual orientation, viewpoints, and other ​“progressive priorities” in antitrust enforcement. [Sen. Vance (R-OH)] As to mergers, Slaughter said that all Americans deserve equal protection under the laws and that just focusing on the highest dollar mergers, for example, would protect cities and not rural areas. She said she would think about the concerns that Vance raised about ​“organized advertiser boycotts.”
  • Remote work policy. [Sens. Capito (R-WV) and Cruz] Asked about the FTC’s policy, Slaughter said FTC employees must come to the office two days every two weeks. Capito said that may account for the low morale and reduced sense of camaraderie at the FTC, and noted that the private sector is now returning to work. Cruz pressed further, stating that the ​“Biden Administration has decided that federal employees don’t need to show up for work.” Slaughter was left to defend the FTC, while stating that the Chair sets the policy in conjunction with OPM.
  • Staying within the bounds of the FTC’s legal authority. [Sen. Sullivan (R-AK)] This theme came up multiple times but Sullivan was especially focused on it. He emphasized that the FTC’s power comes from the laws passed by Congress, and asked the nominees to commit to beginning ever FTC opinion with a detailed discussion of the legal basis for the FTC’s action. All committed to following the law but not to crafting FTC opinions in a particular way.
  • Committing to bipartisanship. [Sen. Fischer (R-NE) and many others] Asked multiple times about this issue, the nominees said yes, yes, and yes.

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Based on the hearing, one would expect these nominees to be confirmed fairly handily. Whether the FTC will truly return to its bipartisan traditions, and whether Khan will get 5-0 votes on controversial matters pending at the agency, are another matter. Still, having two Republican Commissioners on board should provide a diversity of views and greater visibility into agency decision-making (through their speeches, votes, and written statements). We will see soon enough.