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   DealBook: Here come the trustbusters
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   Cracking down on corporations unites a divided government.
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             June 17, 2021
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                  Lina Khan taking over the F.T.C. is a sign of a new era for antitrust enforcement.
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                  Pool photo by Graeme Jennings/Reuters
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             Breaking up
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             The Department of Justice yesterday
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              filed its first antitrust action
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             since President Biden took office, to block the proposed merger of Aon and Willis Towers Watson. It argued that combining two of the three largest insurance brokers would create an anticompetitive “behemoth.” The $30 billion transaction would “eliminate substantial head-to-head competition and likely lead to higher prices and less innovation,” the
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              department’s complaint
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             said.
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             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
              The action came on an already big day for American antitrust.
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             Lina Khan, 32, was sworn in as chair of the Federal Trade Commission, “the youngest in the agency’s history and its most progressive in at least a generation,”
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              write The Times’s David McCabe and Cecilia Kang
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             . Khan is a Big Tech critic whose views on Amazon changed how many think about monopoly in the internet era. She will now have power to reshape the rules: Her leadership role signals that the Biden administration will act on the trustbusting promises made
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              on the campaign trail
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             .
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              Right now, cracking down on corporations is one of the few things that unites a divided government.
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             Democrats and Republicans at the state and federal level are calling for new antitrust rules and challenging Big Tech in court for alleged abuses of competition law. Notably, the very progressive Khan has some staunch Republican support. And the review of the insurance brokers’ merger began last year, when Donald Trump — another vocal Big Tech critic — was in office. Doug Melamed, a Stanford Law professor and the former acting assistant attorney general of the D.O.J.’s antitrust division, told DealBook that if the complaint’s analysis of the market is accurate, the government “almost”
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              had
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             to challenge the combination.
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              More tough antitrust enforcement officials may be on the way.
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             The top antitrust position at the D.O.J. is vacant, and one rumored favorite to take over in a permanent capacity is the lawyer Jonathan Sallet. Sallet, a senior counsel for a coalition of state attorneys general going after Google, has faced
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              criticism from progressives
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             for
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              refusing to ally
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             with Republicans in that effort. Another top contender and vocal Google critic, Jonathan Kanter, has
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              gained praise
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             from progressive groups like Public Citizen and MoveOn.
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             HERE’S WHAT’S HAPPENING
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              The Fed moves up its expected timeline for raising interest rates.
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             Policymakers at the central bank now expect to
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              raise rates twice
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             by the end of 2023, earlier than previously predicted. It’s a sign that the Fed acknowledges the rapidly strengthening economy — “we’re going to be in a very strong labor market pretty quickly here,” Jay Powell, its chairman, said — and is more wary of rising inflation.
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              Wall Street warns about the end of the trading boom.
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             Leaders at Citigroup, JPMorgan Chase and Morgan Stanley said recently that blockbuster results from their trading floors
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              likely won’t continue
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             , as the Fed prepares to raise rates. (Citi, for example, expects second-quarter trading revenue to drop 30 percent year-on-year.)
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              Cyberwarfare takes center stage in the Biden-Putin talks.
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             Though President Biden and President Vladimir Putin of Russia spoke of improving U.S.-Russia relations after
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              their summit
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             yesterday, they traded warnings about economically disruptive hacks. Biden said the U.S. would respond in kind if Russia accelerated its cyberattacks; Putin denied responsibility for recent incidents.
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              CureVac’s Covid-19 vaccine falls short.
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             The highly anticipated shot had an
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              efficacy of just 47 percent
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             in a clinical trial, which doesn’t bode well for it getting adopted anywhere.
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              G.M. speeds up its electric-vehicle production targets.
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              The auto giant said
             </a>
             it would build two new U.S. battery plants and now plans to spend $35 billion on E.V.s by 2025, up from a forecast of $20 billion a year ago. It’s the latest sign of the auto industry’s embrace of electric vehicles as key to its future.
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            <h2 class="css-12n1aic el2acgh0" style="color:#000;font:700 25px/32px arial,sans-serif;margin:0 0 10px">
             Jonathan Bush is back
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             Jonathan Bush, the former C.E.O. of Athenahealth, who left the company he founded amid a campaign by activist hedge fund Elliott Management and revelations about his personal life in 2018, has a new gig. He’s launching Zus Health, a health care information platform that can be used by other developers to build software products like patient management systems for doctors’ practices and even remote therapy apps.
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             Continue reading the main story
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             The name, pronounced “Zeus,” appears to be a nod to Bush’s former company, a software maker (also named after a Greek god) that Bush ran for more than two decades and that was worth
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              about $6 billion
             </a>
             when he departed. Zus Health could run into the same problem as Athenahealth, which made software for doctors’ networks: Getting people to share health information isn’t easy.
            </p>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
              The company has some big-name backers.
             </span>
             They include Andreessen Horowitz, which is leading a $34 million funding round. Julie Yoo, a partner at Andreessen, founded Kyruus, a partner of Athenahealth. “Whatever I was going to do, I was going to do with Julie Yoo,” Bush told DealBook.
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             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
              It’s a shot at redemption.
             </span>
             Bush, who is a cousin of former President George W. Bush, was lauded for his
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              innovative approach
             </a>
             to the staid health care
             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
             </span>
             industry. But when growth slowed, Elliott stepped in. The activist fund’s campaign critiqued Athenahealth’s stock market performance and coincided with a very public airing of Bush’s personal troubles, including
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              allegations of domestic violence
             </a>
             . (Bush, at the time, said he “took responsibility” for the “regrettable incidents,” and that he had mended things with his ex-wife.)
            </p>
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              <span style="font-size:17px;line-height:25px">
               As for redemption, Bush said, channeling the Austrian poet Rilke, “Your goal is not to be torn down, it’s to be destroyed each time by something larger than the thing that destroyed you last time.”
              </span>
             </li>
            </ul>
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            <h2 class="css-12n1aic el2acgh0" style="color:#000;font:700 25px/32px arial,sans-serif;margin:0 0 10px">
             “We needed to stop being about what men want and to be about what women want.”
            </h2>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             <span style="font-style:italic;font-size:inherit">
              — Martin Waters, who was appointed C.E.O. of Victoria’s Secret in February, on the lingerie brand’s turnaround effort. “Rarely has a company so dominant in its sector been exposed as trailing so far behind the culture as Victoria’s Secret was in the wake of the #MeToo movement,”
             </span>
             <span style="font-style:italic;font-size:inherit">
              <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
               write The Times’s Sapna Maheshwari and Vanessa Friedman
              </a>
             </span>
             <span style="font-style:italic;font-size:inherit">
              .
             </span>
            </p>
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            <h2 class="css-12n1aic el2acgh0" style="color:#000;font:700 25px/32px arial,sans-serif;margin:0 0 10px">
             Exclusive: Ayanna Pressley wants banks to open up
            </h2>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             When customers apply for a loan, banks scrutinize their history and assess their risks. Representative Ayanna Pressley, Democrat of Massachusetts, wants the biggest banks to face the same kind of scrutiny. Today, she’s advancing a bill to make that happen, she told DealBook first. “We must have more transparency and oversight of these institutions — now more than ever,” she said.
            </p>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
              “We can’t allow our biggest banks to continue making decisions behind closed doors,”
             </span>
             Pressley said. In May, the C.E.O.s of the country’s six biggest banks testified before House and Senate committees, the first time they faced such extensive public questioning since the financial crisis. Pressley believes transparency should be a regular practice, not a rarity. She also wants the largest lenders — the eight banks that hold nearly half of all domestic banking assets — to report annually on their size and complexity, market activity, employee wages, diversity, climate risk and environmental harms, misconduct, forced arbitration, cybersecurity measures, and any enforcement or regulatory actions.
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             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
              What are the bill’s chances of passage?
             </span>
             Pressley first introduced the bill, the Greater Supervision in Banking Act, during the
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              last Congressional session
             </a>
             . Now she’s trying again, as talk and action on more corporate transparency is on the rise. Proposals calling for more disclosure are in vogue among shareholders
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              this proxy season
             </a>
             . Yesterday, the House passed
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              corporate reporting requirements
             </a>
             covering environmental, social and governance issues (E.S.G.) like climate risks, political spending, C.E.O. pay and tax rates. The S.E.C. is considering
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              increased disclosure mandates
             </a>
             . All of these efforts will face resistance — for example, from Senator Pat Toomey, the ranking Republican on the Senate Banking Committee and a vocal opponent of E.S.G. disclosure — but a push toward greater transparency seems to be gaining steam.
            </p>
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            <h2 class="css-12n1aic el2acgh0" style="color:#000;font:700 25px/32px arial,sans-serif;margin:0 0 10px">
             Why ‘mediocre’ men survive in finance
            </h2>
           </td>
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        </table>
       </div>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             This week, the European Central Bank proposed
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              using gender diversity as a criteria
             </a>
             for approving board members at the banks it supervises. Such mandates are one lever for increasing representation of women in an industry still dominated by men. Another lever — the focus of
             <a class="css-5nb5nb et1n85g0" style="color:#286ed0;-webkit-text-decoration:underline;text-decoration:underline;font-family:inherit;font-size:inherit">
              a recent study
             </a>
             — is to change how banks distribute opportunities and rewards.
            </p>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             When women were asked to reflect on their careers by the London-based nonprofit Women in Banking &amp; Finance, a common complaint was that they were required to find an innovative niche in order to succeed in the finance industry. Men, on the other hand, were more welcome on traditional paths, and did not face the same sink-or-swim dichotomy. It was even worse for Black women, for whom “the headwinds were more intense and the tailwinds were fewer,” according to the report.
            </p>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
              Half of women surveyed specifically mentioned “mediocre” men,
             </span>
             who they said could survive more easily than women with comparable abilities because of factors that included:
            </p>
           </td>
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           <td style="padding:0 0 5px">
            <ul class="css-27qc8p e1darl2c0" style="color:#000;font:20px georgia,serif;text-align:left;padding-left:50px;list-style-type:square;margin-bottom:10px">
             <li class="css-11scvta e1y8brq21" style="line-height:27.5px;margin:0 0 10px 0">
              <span style="font-size:17px;line-height:25px">
               Being in a social group where other members are gatekeepers.
              </span>
             </li>
             <li class="css-11scvta e1y8brq21" style="line-height:27.5px;margin:0 0 10px 0">
              <span style="font-size:17px;line-height:25px">
               Always being around, while women are more likely to take parental leave.
              </span>
             </li>
             <li class="css-11scvta e1y8brq21" style="line-height:27.5px;margin:0 0 10px 0">
              <span style="font-size:17px;line-height:25px">
               A greater reluctance to “manage out” men because they are viewed as breadwinners.
              </span>
             </li>
            </ul>
           </td>
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       </div>
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            <p style="color:#000;font:normal 17px/25px georgia,serif;margin:0 0 15px">
             <span style="font-weight:700;font-size:inherit;font-family:arial,sans-serif">
              Competent, empathetic managers and bonuses for collaboration could be the fix.
             </span>
             Women said empathetic managers gave them the access and freedom to pursue career-enriching opportunities, but they said empathy alone wasn’t the answer. (Some managers just faked the emotion.) Instead, the report’s authors suggested solutions that included:
            </p>
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            <ul class="css-27qc8p e1darl2c0" style="color:#000;font:20px georgia,serif;text-align:left;padding-left:50px;list-style-type:square;margin-bottom:10px">
             <li class="css-11scvta e1y8brq21" style="line-height:27.5px;margin:0 0 10px 0">
              <span style="font-size:17px;line-height:25px">
               Restructuring bonuses to be based at least partly on team performance.
              </span>
             </li>
             <li class="css-11scvta e1y8brq21" style="line-height:27.5px;margin:0 0 10px 0">
              <span style="font-size:17px;line-height:25px">
               Regular assessments of the allocation of stretch assignments and promotions by gender.
              </span>
             </li>
             <li class="css-11scvta e1y8brq21" style="line-height:27.5px;margin:0 0 10px 0">
              <span style="font-size:17px;line-height:25px">
               Formal programs for easing in employees returning from parental leave.
              </span>
             </li>
            </ul>
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