Friday, June 29, 2001

Surprise! Bush’s justice
department bares its teeth
in antitrust cases

The issue: The Bush administration
is being forced to make decisions
on antitrust cases initiated by the
Clinton Justice Department.

JOEL Klein brought aggressive enforcement to the Justice Department's antitrust division as its chief in the Clinton administration. Many critics of President Bush expected a softer stance, if not a total cave-in, to follow. The division's appeal of a federal district court's dismissal of a predatory pricing case against American Airlines, however, suggests otherwise. Moreover, its handling of the case against Microsoft Corp. is evidence that the division will take a tougher stance than expected. Strong enforcement of antitrust laws would dispel perceptions that the Bush administration is controlled by big business.

Predatory pricing is difficult to prove in court, but Klein challenged American Airlines' alleged attempt to drive out competition from the Dallas-Fort Worth market. American offered cut-rate ticket prices and new flights on routes served by fledgling rivals, then raised prices after competitors were forced to quit. Without proof that American sold tickets at rates below cost -- a traditional standard in predatory pricing cases -- Judge J. Thomas Marten ruled that American had not violated antitrust restrictions.

Bush's Justice Department then raised eyebrows by announcing it would appeal Marten's ruling. That decision came after the new solicitor general, Theodore B. Olson, whose former law firm represented American, and Klein's successor, Charles A. James, who has represented airlines in antitrust cases, declared conflicts of interest. That left the decision to John M. Nannes, an acting assistant attorney general held over from the Clinton administration, with the approval of Paul Clement, Bush's deputy solicitor general.

The Microsoft case has attracted attention as the most important antitrust case since the breakup of AT&T nearly two decades ago. A federal appeals court has partly reversed Judge Thomas Penfield's order that Microsoft be broken up. The reversal was more a rebuke of Penfield for misbehavior than a clear legal victory for Microsoft. The judge, in media interviews, had likened Microsoft founder Bill Gates to Napoleon and his company to a drug-dealing street gang -- not exactly a judicious position.

The three-judge appellate panel overturned Penfield's ruling that Microsoft had acted illegally by trying to monopolize the Internet browser market and tying its browser to its Windows operating system. However, it agreed that Microsoft unlawfully had used monopolistic means to give Windows dominance.

President Bush has declined to comment on the Microsoft case except to say that he generally is "unsympathetic" to lawsuits. That would indicate that settlement talks are forthcoming, awkwardly on the heels of a $20 million Republican Party fund-raising dinner in which Microsoft was among a dozen corporate sponsors.

Teachers and tugboat
workers talk strike

The issue: The HSTA wants its
contract signed while employees
for tug companies are negotiating
for a new pact.

Already weary from the strikes by public school teachers and university faculty and the narrow averting of a third by hotel workers this year, people in Hawaii would be within their rights if they flinched when tugboat employees announced they may walk off the job Sunday.

Coupled with continued saber-rattling from the teachers union, which wants an end to its contract hassles with the state, the labor scene here has elements that surely make the public uneasy.

With tourism down, the state's wobbly economy doesn't need another monkey wrench in the works.

The Hawaii State Teachers Association is working out details of a bonus clause in the contract it ratified after the 14-day strike in April. HSTA leaders have said that another walkout is possible, but that seems to be more posturing to prod the state than a real threat. The teachers and state officials should see to it that the dispute over the clause's price tag is settled promptly.

A strike by the Inlandboatmen's Union of the Pacific, however, appears more ominous and could cripple shipping in Hawaii. The 59 union members employed by Young Brothers Ltd. and Hawaiian Tug and Barge say they will strike if there is no agreement on a new contract.

Although businesses on the Oahu, Kauai, Hawaii and Maui would still be able to receive direct shipments from the mainland, those on Lanai and Molokai depend on Young Brothers to deliver their smaller loads from Oahu and would feel the effect of a strike almost immediately.

More troubling is the possibility that workers from other unions will honor the tugboat workers' picket line, effectively halting all shipments in and out of the state's harbors.

Hawaii's isolation leaves the state particularly vulnerable to work actions on its docks. About 90 percent of all goods come into the islands by ship.

The tugboat workers union and its employers may be able to come up with a contract before Sunday. Let's hope so. A strike of more than a few days could deal a heavy blow to Hawaii's already troubled economy and no one would benefit.

Published by Oahu Publications Inc., a subsidiary of Black Press.

Don Kendall, President

John Flanagan, publisher and editor in chief 529-4748;
Frank Bridgewater, managing editor 529-4791;
Michael Rovner,
assistant managing editor 529-4768;
Lucy Young-Oda, assistant managing editor 529-4762;

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