Why Is the Justice Department Treating T-Mobile Like a Client?


Opinion|Why Is the Justice Department Treating T-Mobile Like a Client?

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Makan Delrahim, the head of the Justice Department’s antitrust division, is paid by taxpayers to prevent corporate mergers that damage the public interest. Instead of doing this important police work, however, Mr. Delrahim has chosen to cast himself as a deal maker.

The Times reported on Thursday that Mr. Delrahim worked assiduously this past summer to clear the way for the merger of two rival mobile phone companies, T-Mobile and Sprint, by helping to arrange for the two companies to sell some assets to a third company, Dish. Mr. Delrahim behaved like a man who wanted to make a deal. In text messages, which were disclosed as part of a related court case, he repeatedly coaxed and cajoled executives at the three companies, as well as federal officials who had the ability to block the merger.

Mr. Delrahim has cast his actions as a defense of the public interest. In announcing that the Justice Department had approved the merger in July, he said that he had been prepared to go to court to block the merger had Dish not participated in the agreement. The asset sales are intended to allow Dish to emerge as a viable new mobile phone company, filling the void when Sprint departs the marketplace.

But Mr. Delrahim was negotiating with himself. His campaign to secure Dish’s participation amounted to a concerted effort to satisfy his own objections to the proposed deal. Rather than defending the public interest, he was working to defend T-Mobile’s interests.

almost always seeks to resolve its concerns by making a deal. Regarding mergers as generally beneficial, the Justice Department and the Federal Trade Commission seek to sand off rough edges by extracting promises of good behavior or requiring the companies to divest assets.

Under the guidance of Mr. Delrahim, Sprint has agreed to sell to Dish its prepaid mobile division, Boost, while T-Mobile has agreed to let Dish use its transmission network.

The government’s reliance on such deal making, through consent orders, has some advantages. Suing to block a merger is time-consuming and expensive, and there is no guarantee of success. Also, sometimes the best answer is a compromise. And Mr. Delrahim deserves credit for several reforms. He has sought to avoid reliance on promises of good behavior, which are difficult to enforce. Instead, he has insisted that companies make structural changes, such as divesting lines of business. He has created an office to monitor corporate compliance. And he has changed the standard deal terms to make it easier for Justice Department officials to establish noncompliance.

In 2017, he made an example of General Electric, imposing a daily fine on the company until it complied fully with the promises it had made to win approval of a merger with Baker Hughes.

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