After a decade of empowerment of the FTC, the pendulum swung in the other direction. President Reagan appointed James Miller as Chairman to slow down or reverse the course of the Agency. Miller strengthened the FTC in some respects, but his appointment was met with fear and resistance among agency staff, who believed that the Commission would be neutered or worse under Miller's leadership. Miller indeed slowed down agency activity greatly, and used his post to promote public choice theory views of the Commission and regulation more generally. Modern FTC critics share some intellectual affinity with the Miller regime – Part III of this book will revisit that theme.

The FTC's doldrums were short-lived. President George H. W. Bush appointed a relative outsider, Janet Steiger, to lead the Agency in 1989. Chairwoman Steiger did much to heal the Agency and to put it on a path to policing electronic commerce and privacy. Also during this period, the weaknesses of common law legal theories for policing information privacy wrongs became clear. Congress enacted a bevy of privacy laws concerning direct marketing and the resale of information related to cable viewership and video rentals, while the FTC started investigating the state of privacy online.

From a historical perspective, the FTC has been remarkably well led in the past two decades. Commissioners have been well qualified, and the Agency as a whole has been wise in its case selection. While periodically the focus of Capitol Hill criticism, Congress continued to empower the Agency in the 2000s by increasing its budget and by granting additional investigative authorities. Since the 1990s, typically one or two commissioners have developed expertise in privacy and championed a role for the FTC as privacy enforcer. The FTC even changed its structure in 2006 in order to formalize its privacy role, and started hiring technologists to advise the lawyers about technology. Its main setback has been the creation by Congress of the Consumer Financial Protection Bureau – this action sent the message that the FTC was simply not up to the task of policing financial consumer protection.

The FTC has clearly emerged as the country's top privacy cop. Still, the nature of what kind of privacy policy the FTC is to pursue remains a matter of controversy. When led by Republicans, the FTC has taken a “harms-based” approach to selecting cases.