Strengthen Economic Competition

Background

A well-functioning economy is dependent on healthy and fair market competition. However, across nearly every sector of the U.S. economy, from tech to banking to food,[1] just a few companies control most or all of the market. In agriculture, a “get big or get out” federal farm policy has led to fewer farms and farmers and contributed to at least two generations leaving rural communities.

A September 2024 report illustrates the degree to which all aspects of the food and farm system have been captured, with the top four seed, fertilizer, meat processing, and farm machinery corporations controlling from 60% to 90% of their respective sectors – well over the 40% rate beyond which consumer abuses are likely.[2] On the ground, that means that many rural communities have only one or two stores, and farmers, ranchers, and other producers have equally few buyers for their goods. The lack of competition means that rural residents face higher consumer prices, lower producer prices, and less choice, while the consolidated business owners – often multinational corporations whose profits are not reinvested in the community – reap the benefits.

While much of the work to increase economic competition happens at the federal level, there is an important role for the states as well. This can include legislation like “right to repair,” addressing restrictive contracts that prohibit buyers from making repairs to equipment they own, from smartphones to tractors.[3] There are opportunities for state attorneys general to work with federal agencies like the Department of Justice (DOJ), Federal Trade Commission (FTC) to oppose unfair mergers and acquisitions,[4] or the U.S. Department of Agriculture (USDA) to address anticompetitive barriers in the food and agriculture sector.[5] As discussed below, the Biden Administration made significant advances in strengthening economic competition and implementing consumer protections; states can preserve these measures with these tools:

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Policy Priorities

  • Federal: Pass essential reforms to update and strengthen antitrust policy for the 21st Century, including recommendations identified in the House of Representatives Report[9] on Competition in the Digital Sector and Senator Amy Klobuchar’s Competition and Antitrust Law Enforcement Reform Act.
  • Federal: Pass the Food and Agribusiness Merger Moratorium and Antitrust Review Act
  • Federal: Pass “right to repair” laws.
  • Federal: Strengthen food labeling requirements, beginning with reinstating mandatory country of origin labeling (COOL) on beef and pork, such as in the American Beef Labeling Act. Multinational corporations currently use lax labeling requirements to manipulate and mislead consumers while taking advantage of American farmers and ranchers. USDA’s 2024 final rule “Product of USA” labeling requires that meat, poultry and egg products can be so labeled only when they are derived from animals born, raised, slaughtered and processed in the United States.[10]
  • Federal: Stop corporations from promoting profits over workers by passing the Reward Work Act, which limits stock buybacks, and the Workforce Mobility Act, which prohibits most noncompete agreements that stifle entrepreneurship and trap workers.
  • State: Support enforcement of antitrust laws.
  • State: Demand transparency on state-level corporate lobbying. A 2023 report shows many states are missing lobbying disclosure requirements and those with disclosure laws have a mixed record of actual transparency.[11]
  • State: Support multi-state efforts to oppose harmful proposed mergers, like the $25-billion attempted union of grocery giant Kroger with its competitor Albertsons, which was ultimately blocked.[12]
  • State: Pass state-level “right to repair” laws.

[9] Nadler, Jerrold, and David N. CiCilline. Subcommittee on Antitrust, Commercial and Administrative Law, 2020, Investigation of Competition in Digital Markets: Majority Staff Report and Recommendations, https://judiciary.house
.gov/uploadedfiles/competition_in_digital_markets.pdf
.

[10] USDA Finalizes Voluntary ‘Product of USA’ Label Claim to Enhance Consumer Protection.” USDA, 11 Mar. 2024, www.usda.gov/media/press-releases/2024/03/11/usda-finalizes-voluntary-product-usa-label-claim-enhance-consumer#:~:text=%E2%80%9CProduct%20of%20USA%E2%80%9D%20Final%20Rule,processed%20in%20the%20United%20States.

[11] Young, Robin. “SPECIAL REPORT: The Corporate State Lobbying Black Hole.” Sustainable Investments Institute, 13 Dec. 2023, siinstitute.org/reports.html.

[12] Sisco, Josh. “FTC, States Challenge Kroger’s $25 Billion Grocery Merger With Albertsons.” Politico, 26 Feb. 2024, www.politico.com/news/2024/02/26/ftc-krogers-albertsons-grocery-merger-00143287.

State Examples

  • The New York 21st-Century Antitrust Act (2023 NY SB 6748B) would update antiquated antitrust laws to shift power from big corporations back to workers, small businesses, and communities.
  • New Jersey (2022 NJ S 3778) proposed amending its Antitrust Act to make monopsony illegal and regulate dominant market entities.
  • Pennsylvania (2024 PA HB 2012) proposed penalties for monopolization and monopsonization generally and specific requirements for healthcare mergers. In the prior session, the PA Stop Price Fixing Act (2022 PA HB 2641) aimed to prevent price fixing and a broad range of anticompetitive behavior and to protect whistleblowers.
  • Minnesota (2023 MN HF 398) proposed imposing an abuse of dominance standard for antitrust regulation with a fine up to $1,000,000.
  • Right to Repair: Nearly all 50 states have considered right to repair legislation; these are several that have passed a version:
  • State Attorney General actions:
[13] AG Ferguson Wins Another $460,000 in Anti-price-fixing Case Against Chicken Producers, Resolves Case Against House of Raeford Farms | Washington State. 3 Jan. 2024, www.atg.wa.gov/news/news-releases/ag-ferguson-wins-another-460000-anti-price-fixing-case-against-chicken-producers.

Toolkits

Inspired? Ready to dig in on these issues with your rural neighbors? Our practical communications toolkits will help you connect with new communities through common values. The toolkits provide examples on narrative framing, press release templates, sample talking points, and more. 

Click here for the communications toolkit on Promoting Fair Economic Competition.

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