The American economy is stronger, and consumers benefit, when assets are put to their best use. In a free and competitive market, businesses that can put assets to their best and highest valued use are those that are willing to pay the most for the assets. Americans should be concerned when such market transactions are blocked without good reason.
Consider recent efforts of Standard General to acquire for billions of dollars Tegna, one of the largest owners of local broadcast stations in the United States. Standard General believes that it can put Tegna’s assets to better use.
Large transactions are reviewed by federal antitrust authorities to avoid anticompetitive conduct. After reviewing for nearly a year a proposed multi-billion-dollar acquisition of Tegna by Standard General, the staff of the Federal Communications Commission recently effectively blocked the deal, but not for antitrust reasons.
The FCC staff issued a hearing designation order. Although it did not find that any statute or rule had been violated, the staff stated: “substantial and material questions remain as to both the potential impact, and possible harm, to consumers through higher retransmission consent fees, and the effect on localism through potential reductions in local jobs.” If that sounds like bureaucratic doublespeak, it is.
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RealClear Markets | by Harold Furchtgott-Roth