Anheuser-Busch InBev NV (ADR) (BUD): There’s No Justice in Antitrust Decisions

A taxing decision
It’s interesting that Justice’s deputy assistant AG for economic analysis at the antitrust division lists the AT&T Inc. (NYSE:T)/T-Mobile case as one of her most satisfying accomplishments. The other was preventing H&R Block, Inc. (NYSE:HRB) from acquiring tax return software rival TaxACT. Yet by doing so, the Justice Department severely crimped Block’s ability to compete effectively against Intuit Inc. (NASDAQ:INTU)‘s market-dominating TurboTax software. When there are so many options open to taxpayers in how they file their taxes — software, pencil-and-paper, a local accountant — does anyone really think Justice actually helped anyone by stepping in?

A merger of unequals
There are plenty of examples of mergers that did happen but shouldn’t have, but that doesn’t mean Justice should involve itself. Time Warner Inc (NYSE:TWX)‘s acquisition of AOL, Inc. (NYSE:AOL) is a particularly infamous example, as was Sears Holdings Corp (NASDAQ:SHLD), yet the market dealt appropriately with them both.

When it comes down to it, a reasonable argument can be made that the Justice Department’s real goal is to have only damaged companies join forces, but pairing two sick companies doesn’t mean you’ll get healthy competition.

Because poorly operated businesses ultimately waste resources, Justice should really advocate for pairing an impaired company with a successful one. But when you’re sitting in your law office or ivory tower, it’s hard to really know what it takes to run a business or make a profit, especially if you can’t see over your law books and calculators.

The article There’s No Justice in Antitrust Decisions originally appeared on Fool.com is written by Rich Duprey.

Fool contributor Rich Duprey has no position in any stocks mentioned. The Motley Fool recommends 3M and Intuit and owns shares of Intuit and Staples.

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