Firms' response to new competition a baffling mixture

Washington

THE Obama administration has a new economic worry: competition or, allegedly, the lack of it. America's businesses, the indictment goes, merge too often, innovate too little and bilk consumers too much. The open question is whether this argument is shrewd politics, shrewd economics - or both.

No doubt, the politics are enticing. In this election season, criticising big, impersonal firms has a strong populist appeal. And Americans venerate competition, at least in the abstract, as a check on companies' market power. So the White House's pitch is familiar.