The arrival of a new GOP administration in Washington is an appropriate time to reassess old policies--and to institute new ones that reflect the basic principles of our Constitution. That means limiting the government's power while upholding individual rights and political liberty.

When it comes to the Justice Department, a good place to start is antitrust policy--especially the Microsoft case. Microsoft has now been subjected to a decade-long string of government investigations, decrees, lawsuits and court rulings that have violated its rights, caused a brain drain among its employees and destroyed a substantial portion of the company's market value.

The Federal Trade Commission first investigated Microsoft for "anticompetitive behavior" in 1991. In 1995 the firm was forced to sign a "consent decree," a device common to antitrust cases; it "consented" to follow government edicts that restricted its operations. In 1998, not satisfied that Microsoft was being sufficiently obedient, Janet Reno's team initiated a federal trial. Last June, Judge Thomas Jackson ruled that the firm should be broken up and should "share" its proprietary software codes with competitors.

That sentence is now under challenge at the U.S. Court of Appeals, where oral arguments will be heard on February 26. While the case may not be able to be summarily withdrawn at this stage, Attorney General Ashcroft should do everything he can to stop carrying out the gross injustices initiated by the prior administration.

The Microsoft case symbolizes the essence of all antitrust cases: the government penalizes a large, successful company, not because it broke contracts, defrauded suppliers or bilked customers--but solely because it is large and successful. It may be hard for the public to believe that a business could be punished, not for any corrupt behavior, but for what should be regarded in a free society as virtuous activity. It may be hard to believe that a business could be prosecuted simply for being so much better than its competitors at producing wealth in a free market. But that is what the government has been doing since at least 1890, when antitrust law was first enacted.

The century-long history of U.S. antitrust persecution reads like a Who's Who of America's greatest companies: Standard Oil, Alcoa, DuPont, IBM, American Airlines, Wal-Mart and hundreds more. These firms were called "predatory monopolists," but in fact they were persecuted for being superior producers. Their "sin" was an unrivaled ability to earn huge profits while creating high-quality and low-cost products. Often it was envious, outmatched competitors who lobbied for the antitrust assault--just as Sun Microsystems, Oracle and Netscape pushed for the prosecution of Microsoft.

It is often alleged that antitrust law preserves free enterprise and competition. In fact, it destroys both. The essence of capitalism is private property and voluntary exchange. There is no "right to compete" if that means crippling one's superior competitor; there is only the right to try to create a better product. Antitrust law amounts to the perverse proposition that a company loses the right to its property once it exhibits an ability to decisively win a competition.

When asked about the Microsoft case before the election, George W. Bush said, "I favor innovation, not litigation." He implied--correctly--that Microsoft was being penalized for being innovative. That's a good start. Now Bush should urge Ashcroft to drop the case as soon as is legally possible, just as President Reagan dropped the case against IBM in 1982. Then Bush should call for a fundamental re-evaluation of antitrust law, with the goal of restoring a company's right to be successful. The Justice Department should start scaling back its enforcement efforts in this area. Congressional hearings should investigate the massive injustice and the enormous destruction of wealth caused by the antitrust laws. Ultimately, Congress should abolish antitrust laws outright.

With today's GOP dominance, such change might seem possible. Sadly, however, conservatives have been the biggest supporters of antitrust law. Republicans first enacted it, and conservative economists and law professors have regularly defended it. The Microsoft case itself was actually launched under the previous Bush administration. Robert Bork and Ken Starr work for the plaintiffs. Judge Jackson was appointed by President Reagan. And Republican senator Orren Hatch, chairman of the Senate Judiciary Committee, fully supports the attack on Microsoft.

If the Republican Party cares about political liberty, it should reverse this sorry record. If President Bush cares about promoting "innovation, not litigation," he should rein in the punitive Antitrust Division, and allow freedom to rule.

Richard Salsman is an economist in Cambridge, Mass., and a senior writer for the Ayn Rand Institute in Irvine, Calif. The Institute promotes the philosophy of Ayn Rand, author of Atlas Shrugged and The Fountainhead.