January 28, 2002

The Small Business Survival Committee (SBSC) has filed comments with the U.S. Department of Justice in support of the proposed settlement in United States v. Microsoft.

SBSC's President Darrell McKigney and chief economist Raymond J. Keating wrote: "Considering that the antitrust case against Microsoft had absolutely no basis in economic reality, and that the government brought its case at the behest of competitors-not consumers--who could not keep up in the marketplace, we view any findings against Microsoft, and related restrictions placed on the firm, as unwarranted.  However, given the costs, looming uncertainties, the current economic climate, and penchant for bad law and convoluted economics to dominate in the antitrust realm, Microsoft certainly made the correct business decision in reaching this settlement."

They continued: "The costs of this case for the company, the taxpayers and the economy in general have been formidable.  And make no mistake, these costs are felt by many small businesses.  Small enterprises certainly can be affected by the costs of this antitrust case (and others) in their roles as consumers of Microsoft products, and as suppliers to Microsoft.  In addition, entrepreneurship and business can be impacted by the message sent by government in a case such as this, i.e., that if a business works and competes hard to succeed and gain market share, the government may move against it through regulation and litigation."

McKigney and Keating also warned: "The fact that antitrust law looms unchanged--to be erratically used as a club by government--will continue to cast a shadow over the U.S. economy...  Ideally, the Microsoft case should have been dropped altogether, and looking ahead, dramatic antitrust reform needs to be undertaken to reflect economic reality.  Short of such action though, a settlement in this case, which obviously steps far back from a proposed break up of Microsoft, makes sense.  Hopefully, since much of the government's case has been thrown out or overturned, perhaps this Microsoft settlement will serve as a warning that antitrust restraint on the part of the government far better serves consumers, entrepreneurship and innovation, than does antitrust activism."

For more information, please call SBSC at 202-785-0238, or visit SBSC's website at www.sbsc.org.  SBSC is a nonpartisan, nonprofit small business advocacy group headquartered in Washington, D.C.