A bit strangely, two separate op-eds appear today in the Los Angeles Times and New York Times arguing that it would be a good idea to sue OPEC for violating the Sherman Antitrust Act. Here's the crux of the matter:
Unfortunately, over the years, courts have made it nearly impossible to
use the act against OPEC, whose members claim they are sovereign
nations and thus immune from such prosecution. But OPEC's behavior is
commercial, not governmental or diplomatic. It is perfectly appropriate
for Congress to remove these legal obstacles. Foreign businesses and
individuals have long been subject to U.S. antitrust laws--even for
conduct overseas, if it has substantial effect on commerce here. So
should OPEC.
I'm particularly amused by the line that OPECs members "claim they are sovereign nations," as though it's somehow open for debate. But beyond this, it's absurd to say that OPEC's behavior is "not governmental or diplomatic," or that, as the Heritage Foundation posits, OPEC is engaged in "purely business activities." At this level, it's impossible to distinguish between commercial and diplomatic interests: OPEC member states want to maximize their geopolitical influence, not just their oil revenue. You can't say that sovereign nations are the equivalent of businesses just because they happen to be selling something.
But even if it were possible to sue OPEC (and Thomas Evans in the NYT op-ed comes up with a novel argument for why state governments might be able to, under Article III of the Constitution), it's still a pretty dubious idea. Evans says, "Confronted with the likelihood of huge damages and restraint
of its illegal conduct, OPEC, or some of its members, might seek a
settlement establishing production goals that would provide a price
closer to actual costs." Well, sure, they might. Or they might try to cut production even further in retaliation, or find other ways to attack American interests abroad. Would it end up being a net benefit to Americans? Something tells me I'd rather have the State Department making this decision than a bunch of trial lawyers and judges.
Even worse is Evans's response: "If the president allowed the states to sue OPEC, his actions would
undoubtedly anger political leaders in the Middle East and create the
need for diplomatic initiatives to limit the fallout. But how stable is
the Middle East right now?" In other words: Hey, the Middle East is already pretty messed up. It can't get that much worse, right!?
Not surprisingly, the Bush administration thinks the whole thing is a terrible idea, and managed to convince Senate Republicans to block a bill that would have attempted to permit such suits. Nice to see Mitch McConnell do something useful, for a change. In addition to everything else, if Congress isn't going to pass cap-and-trade legislation, the least it can do is let OPEC countries exercise the prerogatives of sovereignty and artificially inflate oil prices.
--Josh Patashnik