Momentum for FTC credibility is building with key cases now---but a win against big tech is vital to retain it.

Just two and a half years into Khan’s tenure, there is time for things to improve — or, more ominously, to deteriorate further — particularly if Biden is reelected next year and she stays on.

“They haven’t lost all that many cases,” Kovacic observed, striking a generous tone, and adding, “Morale improves a lot if you start winning.”

Some early unofficial initiatives — like the Biden administration’s effort last year to enlist the FTC in its dubious quest to blame inflation on anticompetitive industries — appear to have died a quiet death. The agency also remains on track for a major trial in its case challenging Meta’s alleged monopoly in the supposed market for “personal social networking services,” but there are fears among some FTC officials that the agency will lose this case, too, which could do further damage to the agency’s long-term credibility and to Khan’s legacy. One skeptical former official told me that they would not be surprised if the case gets dismissed after the end of discovery and before a trial even begins.

As for what lies ahead, the people I spoke with contemplated a range of scenarios, including the status quo — generally believed to be untenable — and a moderating “reset,” as Kirkwood put it to me prior to the filing of the Amazon case. He argued that “it would be extremely helpful if the case selection, at least for a time, were more traditional — more consumer or labor oriented.” Khan’s “reputation is preceding her,” he told me, and she is “appearing before the federal courts with an asterisk.”

A bleaker scenario posited by others is that Khan’s tenure at the agency could end up playing into the hands of a skeptical Supreme Court, whose conservative majority has made clear that it will push back on what it believes — fairly or not — to constitute overreach on the part of the executive branch. Kovacic praised Khan for “energizing a new generation of scholars and students” but noted that “the federal courts seem to be edging in the direction of rethinking the scope of the FTC’s power — its decision-making framework, the very constitutionality of how it operates.”

The concern is hardly misplaced. The past few years have generated several Supreme Court decisions that have curtailed the powers of federal regulators — including the FTC itself — and made them more vulnerable to legal challenges. The justices recently heard oral argument on a legal challenge to the Securities and Exchange Commission’s system of in-house courts that could also make matters worse for the FTC, which has a similar system.

“I don’t know how much the commission is thinking at the moment about the impact of trying to build a more expansive program in the face of this gathering judicial storm,” Kovacic wondered. “Do you realize you could come out of this with a much-diminished agency?” he asked. “And Congress is not coming to the rescue for you. You could come out of this with an agency that is much weaker than the one that you went in with — permanently weaker.”