FTC Chair Admits ‘Things Could Have Been Done Better’ as Commission Workforce’s Morale Plunges

Then FTC commissioner nominee Lina M. Khan testifies during a Senate Commerce on Capitol Hill in Washington, U.S., April 21, 2021. (Graeme Jennings/Pool via Reuters)

Confidence among the Federal Trade Commission’s (FTC) career staff in senior leadership has declined by 34 percent under the management of Chair Lina M. Khan, according to House Energy and Commerce Committee Chairman Cathy McMorris Rodgers (R-Wash.).

Khan’s tenure has been controversial since she was appointed by President Joe Biden at the beginning of 2021. Since she was named to lead the regulatory agency, two Republican commissioners have resigned in protest of her management practices and policies.

“Chair Khan, under your tenure, the integrity and effectiveness of this independent agency has been repeatedly questioned. You’ve suffered many losses in federal court at all levels of the judiciary branch. You’ve drastically reduced transparency and accountability by cutting out key voices at the agency,” McMorris Rodgers told Khan in her opening statement at an April 18 congressional hearing to consider a request for a 37 percent budget increase for the FTC.

“Both Republican commissioners have resigned during your tenure. Senior staff have quit in record numbers, with reports in the [media] describing you as ‘abusive’ and a ’tyrant.'”

McMorris Rodgers is an ex officio member of the Innovation, Data, and Commerce Subcommittee that convened the hearing.

“There has been a 34 percent decline in employee confidence in senior leadership’s respect for them and motivation at work. Former commissioner Christine Wilson cited your disregard for the rule of law as one of the reasons for her resignation. Time and time again, you have prioritized a personal and political agenda over the integrity of the FTC and the interest of Americans,” McMorris Rodgers said.

Rep. Cathy McMorris Rodgers (R-Wash.), chair of the House Energy and Commerce Committee, speaks during the hearing with TikTok CEO Shou Zi Chew before the House Energy and Commerce Committee in the Rayburn House Office Building on Capitol Hill on March 23, 2023. (Chip Somodevilla/Getty Images)

Subcommittee Chairman Gus Bilirakis (R-Fla.) also denounced Khan’s management of the FTC, asking how she can justify asking Congress to give the commission a budget increase of $160 million when “staff has been diverted from mission-critical functions and pulled from bureaus to focus on merger reviews.”

“There has been such a mass exodus of career staff that you seem to be squandering away the resources that we give you,” he said.

Dissatisfaction ‘Not a Statistical Anomaly’

The hearing memo prepared by the subcommittee’s majority staff and made public before the hearing reads: “Under Chair Khan’s leadership, the FTC has seen a precipitous decline in staff approval and the early departure of both Republican commissioners. In 2020, 87 percent of surveyed FTC employees agreed that senior agency officials maintained high standards of honesty and integrity. In 2021, that number plummeted to 53 percent, and to 47 percent in 2022.

“This dissatisfaction is not a statistical anomaly—in 2022, of the FTC’s 1,123 full time employees, 765 completed the survey. Recognizing this issue, political leadership took action to try to ease staff concerns by lifting the staff gag order, which limited public and private appearances by FTC staff, and took ‘concrete steps to address staff feedback,’ including a shift in senior leadership. Even after making these changes, staff confidence in Chair Khan’s leadership has continued to decline.”

In her opening statement, Khan ignored the criticisms and instead focused on a lengthy list of proposed rules and complaint settlements reached by the commission since she arrived.

Little more was said about the criticisms during subsequent cross-examination by subcommittee members except when Rep. Neal Dunn (R-Fla.) told Khan that an internal survey showed that only 49 percent of the FTC’s career staff believe senior leaders of the commission practice high standards of honesty and integrity, compared with 87 percent who thought so in 2020.

“In response, I would just say that I am incredibly proud of the FTC staff who day after day are on the front lines of protecting Americans from bad business practices,” Khan said.

“There is no doubt that early in my tenure there were things that could have been done better. But since then, we have been taking these survey results seriously and taking steps to make sure we clearly understand what was the source of these declines and what we can put in place to remedy them.”

As one of the federal government’s oldest regulatory agencies, created in 1914, the FTC consists of five commissioners appointed by the president and confirmed by the U.S. Senate to exercise broad authority to protect U.S. consumers from dishonest business practices.

A spokesman for Khan declined to provide comment and referred The Epoch Times to the chairman’s opening statement and her response to Dunn’s question.