Biden signs order to tackle corporate abuses
From agriculture to drugs and labour
WASHINGTON • U.S. President Joe Biden signed a sweeping executive order on Friday to promote more competition in the U.S. economy, urging agencies to crack down on anti-competitive practices in sectors from agriculture to drugs and labour.
If fully implemented, the effort will help lower Americans’ internet costs, allow for airline baggage fee refunds for delayed luggage and cut some prescription drug prices, among many other steps.
Biden said the order “commits the federal government to full and aggressive enforcement of our antitrust laws.”
“No more tolerance of abusive actions by monopolies. No more bad mergers that lead to massive layoffs, higher prices and fewer options for workers and consumers alike,” he said at a White House signing ceremony.
The president noted areas where many advocates feel that prices are too high, wages are tamped down or new businesses excluded from competition. “Let me be very clear, capitalism without competition isn’t capitalism, it’s exploitation,” he said.
The White House says the rate of new business formation has fallen by almost 50 per cent since the 1970s as large businesses make it harder for Americans with good ideas to break into markets.
Biden’s action goes after corporate monopolies across a broad swath of industries, and includes 72 initiatives he wants more than a dozen federal agencies to act on.
The order instructs antitrust agencies to focus on labour, health care, technology and agriculture as they address issues that have irritated consumers, and in the case of drug prices, has bankrupted some.
Lower wages caused by lack of competition are estimated to cost the median American household US$5,000 per year, according to a White House fact sheet that cites research from the American Economic Liberties Project, an influential Washington-based anti-monopoly group.
The initiatives will no doubt kick off a series of fights with the affected industries. The powerful U.S. Chamber of Commerce issued a statement saying the move “smacks of a ‘government knows best’ approach to managing the economy” and pledged to “vigorously oppose calls for government-set prices, onerous and legally questionable rulemakings, efforts to treat innovative industries as public utilities, and the politicization of antitrust enforcement.”
Among the administration’s plans to open up the U.S. economy are new rules to mandate ending excessive internet contract termination fees, allow hearing aids to be sold over the counter and end non-compete clauses for millions of workers and many occupational licensing requirements.
On prescription drugs, it aims to lower prices for consumers by allowing importation of drugs from Canada, where they are cheaper. It also urges the Department of Health and Human Services to draw up a plan to fight high drug prices and gouging.
Evercore/isi analyst Michael Newshel said in a research note that the impact of allowing imports from Canada on pricing would be limited given Canada’s limited drug supply and that Canada has indicated in the past that it would not co-operate with any program.