Antitrust in The Godfather

Rating: 9/10 (8 May 2013)

We often hear that what the Feds nail mafiosos on is tax evasion, rather than the substantive underlying illegal commerce. What if it was antitrust instead of tax?
Gangland is exactly where you'd expect to find anti-competitive behavior, working in the shadows to extract rents. After all, unfairly treated competitors can't complain to the authorities; their recourse is instead only to violence. What's more, those competitors are often themselves taken out of play by the government, whether through transparent corruption (e.g., the legislatively and executively sponsored "war on drugs") or through opaque corruption (e.g., bribery of corrupt cops by competing gangs). Thus, the very illegality of the products in which gangs traffic makes for government-granted monopolies that incentivize the illegal behavior.
As much trouble as these monopolies and oligopolies cause for incumbents, they're even more of a headache for insurgents. Hence, barriers to entry in mob-controlled industries are high. Indeed, in Coppola's 175-minute film, there's barely a suggestion that a new family could come to compete with the five, let alone that an organization other than a family could try to enter. (There is one suggestion than an existing deputy of one of the families could do a start-up.)
Relatedly, the specter of boycotting by the Corleone family is ever-present. The Godfather's office is the marketplace. Demand walks in, and the Godfather farms it out to approved suppliers of murder, maiming, extortion, etc. Hence the refrain from his lieutenants, "Who(m) should I give this job to?" As an antitrust defendant, Don Corleone would likely argue that this matching of buyers to sellers is a market-promoting service, see Chi. Bd. of Trade v. United States, 246 U.S. 231 (1918)—like a market maker on a securities exchange—while prosecutors would allege that, by unilaterally choosing the supplier for each transaction, he is impeding an open market rather than lubricating it. Prosecutors would background this argument with atmospherics of racial discrimination, cf. NAACP v. Claiborne Hardware Co., 458 U.S. 886 (1982), by the Corleones qua employer; Mike says of the family attorney, "He's a good lawyer (but n)ot a Sicilian one."
Market-splitting is rampant in The Godfather. One family controls the Bronx, another Brooklyn, and so on. In a particularly apt bit of dialog, during the epic meeting of the five families, one head refers to the United States as being split into "territories." This meeting is the smoking gun of collusion amongst the five families. If they could survive evidentiary challenges, such gems as Don Corleone's "When did I ever refuse an accommodation?" would find prominent places in the prosecution's brief.
The tying in Coppola's film is blatant enough to make Yale, Hack v. Yale Corp., 237 F.3d 81 (2d Cir. 2000), or Microsoft, United States v. Microsoft Corp., 253 F.3d 34 (D.C. Cir. 2001) (per curiam), blush. And the ties that bind are first and foremost family ties. Hence the brilliant opening sequence of intercutting between shadowy interiors of business deals and sun-washed exteriors of the wedding, which lingers long enough—the latter replete with multi-generational singing, dancing and tribute-paying—to make us feel we're there, part of the family. The mistake of the father whose beseeching of Don Corleone opens the film was to miss this lesson. By not investing in respect for the family upfront, by forgetting that the contract with the Godfather is a deep basket of goods and services that one locks into for the long term, he insults the CEO. Only by signing up for the whole kit and caboodle—including reciprocity of a sort and at a time to be named later—does he get into the club. Hence the plausibility of Mike's claim at the end of the film that he is imposing exile—the ultimate punishment by the market dominator—on his brother-in-law. Sonny's career as family head is doomed not just because he's a hothead but also because he forgets that ultimately it's all about family.
All these shenanigans are ways of restraining trade. And how better to restrain trade than decapitate the $600,000 horse of a Hollywood producer who won't hire your guy and leave the head in his bed, to whack a Las Vegas developer who won't sell you his hotel, or to execute your competitors point blank under the mantle of family ties? While making offers that one figuratively can't refuse is generally market-promoting, making offers than one literally "can't refuse" is market-restricting.
So, would going after mob commerce under the antitrust laws be an unprecedented prosecution of a monopoly that the government itself sponsored? Nope. The government unwittingly sponsors monopolists all the time, by imposing so much regulation that potential entrants don't bother. Thus the Godfather is referring to America's political organs when he says, "I believe in America. America's made my fortune." And he is speaking on behalf of countless regulatorily entrenched incumbents—from banks to taxis, Katrina Miriam Wyman, Problematic Private Property: The Case of New York Taxicab Medallions, 30 Yale J. on Reg. 125 (2013)—too.