NCPA - National Center for Policy Analysis

Will Government Lawyers Run (And Ruin) Microsoft?

November 9, 1999

Although a federal district judge has only issued findings of fact in the Microsoft case, the final ruling may well entail the breakup of the software leader. For many observers, that prospect is filled with danger signs.

Here are some of their worst fears:

  • The greatest danger is that Justice Department lawyers are injecting themselves into the intimate managerial details of a company they cannot fully understand because they are not professional business managers.
  • Even investment bankers with great business savvy who buy up companies and break them into pieces -- hoping that the parts will be more valuable than the whole -- sometimes wind up with corporate disasters on their hands.
  • In its zeal, the federal government destroyed the American shoe industry when it went after the United Shoe Machinery Corp. in 1947 -- and today the U.S. imports virtually all its shoes.
  • Things also went awry after the trustbusters attacked Schwinn Bicycle Corp. and Pan American World Airways.

Many other antitrust cases had unintended consequences that ultimately hurt the U.S. economy.

The possibility of the federal government making mistakes in the case of Microsoft are enormous -- particularly in light of the fact that those who are on the attack have no skill, training or experience at micromanaging.

Source: Bruce Bartlett (National Center for Policy Analysis), "Micromanaging Microsoft," Washington Times, November 9, 1999.

 

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