Anthrax eclipsed a much more important news story this month: Microsoft’s new settlement with the Department of Justice, which has successfully gutted antitrust laws. Let’s look at some of the aspects of that settlement:

Instead of making the Windows source code available to competing software companies so they can build products that run smoothly on the Windows desktop, Microsoft will only have to make “pieces” of the source code available. That’s not a solution; in fact, it’s been the trouble all along. Inside the portions they don’t release, Microsoft engineers bury little timebombs that make competing companies’ products run slowly, generate errors, or freeze up. This practice will continue unabated.

Microsoft will no longer be able to make computer companies sign exclusive contracts that allow them to sell only Microsoft products loaded on their computers. Microsoft stopped this practice when the suit was first filed, because it’s flatly illegal. What the settlement allows instead is for Microsoft to discount its products to make them more enticing–in other words, price its competitors out of business. Microsoft has the vast advantage here, because of its huge size and enormous cash reserves. No software company in the world can beat its discounts.

Microsoft can add as many new features to its Windows program as it wants to–as long as it offers a version of Windows that doesn’t have those features. (As if any computer maker is going to opt for less program for the same price!)

Microsoft must enter a five-year consent decree with the government–essentially a promise of good behavior from Microsoft that has no teeth in it. A three-member “advisory committee of independent experts” is supposed to oversee Microsoft’s operations to make sure they don’t violate antitrust law or the terms of the settlement. But no mention has been made of who will appoint the members of the committee, how the government can assure their “independence,” how much access they will have to Microsoft’s trade secrets or source code, and what (if any) power they’ll have to sanction Microsoft. Just watching from the sidelines and crying “foul!” or saying simply “We wish we could get a closer look!” will have no effect.

In short, Microsoft will not be split in two, or forced to unbundle software products from its Windows operating system, or place Internet Explorer in the public domain. Microsoft will not have to license Windows to other companies so they can combine it with their own products, or do anything that will allow other companies to actually compete with it. Why? Because that might hurt the economy, stupid!

How did this happen? It was only a year and half ago that Judge Thomas Penfield Jackson ordered that Microsoft be broken up. But a number of things have led to this reversal.

Microsoft appealed Judge Jackson’s ruling to a more conservative Appeals Court. The court ruled that, because of certain statements made by Jackson to the press, the judge was biased against Microsoft; therefore, his ruling to split the company in two was invalid. Members of the Appeals Court have made statements to the press in support of Microsoft, but that didn’t seem to bother them. They couldn’t, however, set aside the guilty verdict, because of the egregious nature of Microsoft’s business practices.

So they threw the case to US District Judge Colleen Kollar-Kotelly to determine a suitable penalty. Kollar-Kotelly has done her best to wriggle out of her responsibility. First she appointed a mediator who specializes in antitrust law; this was unacceptable to Microsoft, because the mediator kept trying to come up with real punishments. Kollar-Kotelly then replaced him with a mediator well-known for his mediation skills, but who has no clue about antitrust law. Then she set an arbitrary deadline of Nov. 2, 2001, to reach a settlement, “or else.”

Enter George W. Bush and his abominable appointment of John Ashcroft as Attorney General in charge of the Justice Department. The new, fascist wind blowing through Justice sees attorney-client privilege as a hindrance to law enforcement, the Constitution as a pillar supporting communist civil-libertarians, and antitrust law as one of the seven deadly sins. So the government’s prosecutors have done an about-face and are now happy to settle. Nine states have agreed to the settlement, primarily because they’re running out of money to pursue the case and are desperate for closure. Nine other states are continuing to sue, but only California has the resources to continue, and its options are limited.

Microsoft has finally received its slap on the wrist. Now it can go about business as usual: buying up competitors, giving its own products preference on the Windows desktop, and using Windows as a tool to pry open new software markets.