Finance

‘I took a job at the EU – then the French attacked me for being American’


Speaking on holiday from Edinburgh, Scott-Morton says: “I am disappointed because I was looking forward to it.

“I had taken some pains to rearrange my life, my family’s life, my housing, my teaching, university, my students, my research projects. All were reorganised so that I could accommodate the need to work for the government.

“We plan our classes a year in advance,” says Scott-Morton, who has been on the faculty at Yale since 1999. “I have to tell my university if I’m going to Brussels so they can find someone else to teach my classes in September.”

Scott-Morton was well qualified for the job, having served in a role at the US Department for Justice for the Obama administration where she was deputy assistant attorney general for economic analysis.

During her time, the agency blocked deals including the AT&T and T-Mobile telecoms tie-up and launched a probe into Apple’s e-books over price-fixing.

More than three dozen economists, including Nobel prize winner Jean Tirole and former International Monetary Fund chief economist Olivier Blanchard, leapt to Scott-Morton defence when the French objected to her appointment.

“Scott-Morton is one of the best economists in the world in the domain of industrial organisation, a major contributor to policy thinking on tech regulation, and strongly motivated for public service,” they wrote in an open letter.

The incident has now left a gaping analytical hole in the EU during a crucial six months for competition law. The bloc’s flagship digital markets act comes into full force next Spring and will give Brussels more teeth to police Big Tech.

Seven companies have been designated so-called “gatekeepers” under the new rules, including the parent companies of Google, Amazon, Apple, Facebook and Microsoft. All have a market cap of more than €75bn (£64bn) and at least 45m monthly users.

Critics have highlighted that Scott-Morton has performed consulting work for three of these seven giants. She points out that most of that work is in the past and consulting is common in the sector.

The former holder of the EU chief competition economist job and the current acting chief have both worked with the same global consulting firm as Scott-Morton.

The French have form when it comes to hostility towards the US.

When rumours swirled that Pepsi wanted to buy dairy giant Danone in 2005, then French finance minister Thierry Breton declared that “France is not the wild west” as politicians scrambled to defend the company.

The US soft drinks maker was branded an “American Ogre” by the country’s press, even though no official bid was made. The French were mocked for their “strategic yoghurt” policy, which quickly became bywords for French protectionism.

Thierry Breton, a Macron ally, is now the EU’s internal markets chief who reportedly has ambitions for the top job in Brussels.

He is part of a faction who have been alarmed by Danish competition chief Vestager’s willingness to block a merger between the rail divisions of Siemens and Alstom, two large European companies. Supporters of the deal want to build national champions and are in favour of more state aid and subsidies.

Scott-Morton steers away from commenting on the politics or the individual players in Brussels, saying only: “The agenda of making competition work would have been advanced if I had been in that job.”

One deal Brussels has approved is the proposed acquisition of Call of Duty-maker Activision Blizzard by Microsoft. The Commission accepted the latter’s concessions on cloud gaming, even as British authorities blocked the deal on the same grounds.



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