To me, the most striking thing about AT&T paying Michael Cohen for, I guess, “advice” about how the Trump Administration might handle the Time Warner-AT&T merger is what a waste of money it was.  If AT&T thought that Cohen could influence Trump in favor of the deal, it was money ill-spent.

I’m sure that many of us (me!) , believe that combining a giant telecom like AT&T with a cable content company like Time Warner will not necessarily be great for consumers.  But the general thinking in the antitrust world is that this kind of merger, termed “vertical” because the two companies are in separate business lines, is acceptable.  That the Department of Justice sued to block was truly a surprise move, even given Trump’s ranting about CNN.  Heck, before he took the job as head of the DOJ’s antitrust division, Makan Delrahim had publicly stated that this merger should not be blocked on antitrust grounds.

If AT&T paid Michael Cohen to convince Trump not to order the DOJ to sue to block the deal, it miscalculated.  If AT&T paid Cohen for psychological insight into Trump and Cohen told them anything other than, “He’s mad at CNN and will sue to block the deal,” it should demand a refund.

One thing I think we can take away from all of this, which hasn’t much been written about, is the extent to which major mergers are now subject to presidential whim.  This did not start with Trump.  In 2016, the Obama administration blocked the Pfizer-Allergan merger, because it would have led to the new company being domiciled in Ireland and avoiding many US taxes.  I agreed with Obama’s impulse there, but most people I follow who work in mergers and acquisitions believed that the move was illegal. It’s just that the deal was supposed to close in less than a year while litigating might take a decade.

Most of the people I follow on Time Warner-AT&T believe the government presented a weak case to block.  But, in front of a judge, you never know.  My guess is that the DOJ loses and this merger goes through, but it’s just a guess.  In the meantime, Trump has used another lever of presidential power against large mergers — the Committee on Foreign Investment in the United States (CFIUS).  CFIUS is supposed to block mergers that might have national security implications.  As an unlikely hypotehtical, CFIUS would prevent a Russian defense contractor from buying Lockheed Martin, But CFIUS is not a real agency.  It’s a committee made up of people from various offices in the executive branch.  The President is the ultimate decider.

Well, guess what?  Ever since we started a “trade war” with China, deals involving China-based companies, whether they are buyers or even minority investors, are non-starters in front of CFIUS.

Well, I’ve strayed from Cohen, so I’ll get back to him.  I think AT&T chose to waste its money not just because Cohen seemed an easy avenue to Trump (and for sure sold himself as such) but because in the mergers and acquisitions arena, as in so many others, our weak congress has ceded so much authority to the president and the executive branch that companies must now consider presidential whim to be on an almost even playing field with the rule of law.

Don’t get me wrong — I am not overly concerned about the rights of big companies to merge. I am concerned about the power of the presidency, especially given the current officeholder.  When a company like AT&T pays a skeev like Michael Cohen ton of money for a short period of work, it speaks to something broken in the system.  It is not, as Politico tried to spin it, normal influence peddling.  It’s a sign that our whole power structure is out of whack.  For professional reasons, I pay more attention to mergers than most, but this is hardly the most important  area of our economic or political lives under such influence.  But presidents are now approving and denying mergers with basically the same freedom they have to wage wars without Congress ever declaring it just.