Was collaborative learning successful? Did it channel rivalry from cutthroat competition over volume into improvements in products and production processes? Did benchmarking perturb habits and spark inquiry? Did collaborative learning circumvent collective action problems? What exactly was the FTC's role in establishing and diffusing collaborative learning? This chapter addresses these and other questions through a case study of the commercial printing industry.

Commercial printers were pioneers in developmental association. In 1909, they launched the American Printers Cost Commission to develop a uniform cost accounting system. Two years later the United Typothetae of America (UTA) took up the commission's work. After a year of work, the UTA completed its first Standard Cost System; by 1913, it distributed its first benchmarking data to commercial printers. Cost work had positive effects on the UTA. Membership tripled, local chapters bloomed, and hundreds of printers adopted the cost system. But progress stalled in 1916 and UTA leadership turned to the state, where they found helpful encouragement from the Federal Trade Commission. Armed with a fresh sense of public purpose, the UTA launched a three-year organizing campaign in 1918. By the early 1920s, one-third of all commercial printers in the United States were using the standard cost system and many of those were actively benchmarking. The result was to end cutthroat price competition in many cities, increase product diversity, augment labor skills, advance technological innovation, treble productivity, and increase industrial fragmentation. Collaborative learning was successful in commercial printing.

The builders of regulated competition created a new path to economic and political development, which successfully combined America's traditional aspiration to equality with modern management. Brandeis enhanced the cultural debate over industrial society during the election of 1912 by combining republican commitments to equality with progressive aspirations to mastery in the ideology of republican experimentalism. He devised a theory of regulated competition, which showed how business, trade associations, and government could work together to channel business rivalry from predation to improvement. And he drew on his experience in railroad and utility regulation to outline a blueprint for a cultivational commission devoted to regulating competition. In 1914, creative legislators combined the features of progressive, populist, and Brandeisian proposals for a federal trade commission and they forged a legislative majority by interpreting their work through multiple frames. The Federal Trade Commission Act of 1914 became law with multiple meanings that licensed numerous projects, including regulated competition. Creative administrators at the FTC cultivated experimental and deliberative capacities in peak, professional, and trade associations through two programs: cost accounting and trade practice conferences. Their efforts bore fruit. The U.S. Chamber of Commerce conducted a forum to conceptualize developmental trade associations. The National Association of Cost Accountants built an association devoted to information exchange and collaborative learning. And with the help of the FTC, the U.S. Chamber, and the cost accountants, 15 percent of trade associations in 25 percent of U.S. manufacturers transformed themselves from cartels into developmental associations.

Industrialization imperiled democracy and markets in the United States because it concentrated power in large corporations. Looking back at the Progressive Era, scholars generally see two options: break up corporations or regulate them. There was a third way, which contemporaries called regulated competition. In this framework, the state checked the tendency to concentrated power in the first instance by steering competition from predation into improvements in products and production processes. Louis Brandeis conceptualized regulated competition and introduced it into public debate during the presidential election of 1912.

Political entrepreneurs in Congress enacted many of Brandeis's proposals into law. They licensed the Federal Trade Commission (FTC) to check predatory rivalry before it turned into unassailable power and to cultivate business capacities to improve the quality of competition. The FTC enlisted business and professional associations to make regulated competition workable through better cost accounting and trade practice conferences. Trade associations in specialty manufacturing took up the FTC's challenge, and reinvented themselves from competition-suppressing cartels into developmental associations devoted to enhancing products, services, and productivity. The commercial printing industry showed how developmental associations could succeed. And nearly a third of the manufacturing industries in the United States adopted the tools of regulated competition and developmental association to improve economic performance. By a number of measures, regulated competition better reconciled traditional American aspirations to egalitarian democracy with modern ambitions to economic prosperity than either free markets or regulated corporations.

Brandeis formulated a blueprint for a federal trade commission from his experience with railroad regulation. He learned about the limits of progressivism and applied economics when he became involved in a series of Interstate Commerce Commission (ICC) rate cases between 1910 and 1914. Although he was a partisan participant, and his side won, Brandeis came to see railroad regulation as a failure. Instead of realizing the progressive promise to autonomy, legitimacy, and objectivity, applied economic science led to stalemate and paralysis. Brandeis proposed an alternative, which I call cultivational administration. Although the ICC did not take up his proposal, it became the basis for his Federal Trade Commission design and, as we shall see in Chapter 4, a third way to organize a commission. This chapter explains what Brandeis learned from railroad regulation and outlines his alternative.

Brandeis's relationship with the engineers flourished in railroad regulation, where they taught him new ways to think about efficiency and regulation. He consulted them on matters of railroad efficiency, enlisted their service as expert witnesses, and drew on their expertise to craft an alternative design for railroad regulation. And as he did, he deepened the chasm between the way engineering and economics approached the construction of knowledge. He learned four lessons from the engineers, which would reshape his understanding of economic efficiency and regulation. First, railroad cost accounting practices short-circuited improvement, because they prized volume over all other ends. Second, the economists who designed railroad rate regulation mistakenly reified railroad accounting practices as scientific law.

The election of 1912 divided antitrust reformers and Louis Brandeis proposed to unite them. Populist Democrats hoped to decentralize economic power by enforcing competition. Progressive Republicans accepted the concentration of economic power, but wanted to regulate it with an independent commission. Louis Brandeis offered a third way. Neither self-regulating markets nor regulated monopoly, regulated competition would harness a regulatory commission and civil society to channel rivalry from predation into improvements in products and production processes. By recomposing the relationship between public administration and competition, Brandeis's proposal promised to reconcile the populist desire for decentralized power with the progressive desire for administrative mastery and economic progress.

The contest over antitrust reform raised fundamental questions of narrative identity and cultural authority. It would not be won or lost by technical considerations alone. The election of 1912 turned on who spoke most directly to U.S. anxieties over the relationship among economic prosperity, democracy, and power. But cultural conflict seemed mired in irreconcilable differences in 1912: populists lashed out at progressives for capitulating to despotic power; progressives charged populists with unwarranted faith in individualism and self-regulating markets. Reconciliation promised immense political vitality and Brandeis took up the challenge. He disassembled ancient republican fears of monopoly power and recombined their parts with modern faith in science in a cultural schema I call republican experimentalism.

This chapter situates, explains, and defends republican experimentalism and regulated competition. The first part situates Brandeis's approach within a debate between populists and progressives – a debate that was structured by the U. S. Supreme Court.

Conflict over the meaning of antitrust reemerged in the 1920s, when the Department of Justice and private litigants challenged the legality of trade practice conferences and developmental associations in court. These cases pit two methods of assessing accountability against each other. On one side were the critics of regulated competition: the Department of Justice, the courts, and the economists. Like the progressive economists and laissez-faire constitutionalists we encountered in Chapter 2, they wanted to subject regulated competition to standards of classification. They asked whether trade practice conference rules and trade association instruments were instances of perfect competition or artificial monopoly, which served public or private interests. Adopting deductive categories from economics, they hoped to establish a bright line between private rights and public authority and then measure trade practice rules and trade association instruments against that classification. On the other side were the partisans of regulated competition: Brandeis (now an associate justice on the Supreme Court), the FTC, trade associations, and the cost accountants. They wanted to subject trade practice conferences and developmental associations to standards of process, power, and performance. Like Brandeis's social theory of restraints of trade (explained in Chapter 2) or Gaskill's theory of customary competition (explained in Chapter 4), they asked: What was the historical process that resulted in problems that trade practice rules or trade association instruments were intended to solve?

Between 1915 and 1932, creative syncretists at the Federal Trade Commission were remarkably successful in realizing Brandeis's proposal for cultivational governance. While they lacked the capacity to carry out cost accounting or to monitor trade agreements on their own, they found resources in civil society to construct institutions devoted to regulated competition. Deliberating regularly with cost accountants, trade associations, and the U.S. Chamber of Commerce, creative administrators renarrated the causes of cutthroat competition. Like Brandeis's engineers, they hypothesized that it was the result of cost conventions that overvalued volume. By doing so, they opened new avenues to policy experimentation and institutional design. They launched a Cost Division, published two cost accounting manuals, encouraged trade associations to design cost systems of their own, and assembled industries in deliberative conferences. Building on these initiatives, creative administrators reconceptualized the commission's role in steering competition from predation to improvement. By 1926, they had institutionalized a deliberative structure for defining standards of fair competition and reviewing associational cost accounting initiatives. In doing so, creative syncretists invented a novel form of regulatory organization, which proved effective in collaborating with professional and business associations to respond effectively to economic uncertainty, diversity, and change.

Students of state building in the 1920s do not usually recognize policy innovation at the FTC, because they see the commission's formative context as inhospitable to autonomy and policy planning.