Article Summary –
A group of Democratic lawmakers has called for President Joe Biden to investigate major grocery store chains for price manipulation, following a report from the Federal Trade Commission that suggests these companies took advantage of pandemic-related supply chain disruptions to increase their profits. The letter, led by Senator Elizabeth Warren, urges the President to leverage his executive authority to enforce additional steps to combat rising food costs, such as encouraging the FTC to issue guidance on potential violations of price discrimination laws and creating a task force to investigate food price manipulation throughout the supply chain. Meanwhile, the Biden Administration has taken steps to lower grocery costs, such as updating the Thrifty Food Plan and partnering with state attorneys general to address anti-competitive behavior.
Democratic Lawmakers Push for Investigation into Grocery Chains
Democratic lawmakers are urging President Joe Biden to investigate grocery store chains for price manipulation. In a letter sent Monday, they requested the use of executive power to enforce measures to combat rising food prices independently of Congress.
FTC Report Sparks Call for Action
The move follows a report by the Federal Trade Commission (FTC) revealing major grocery chains exploited supply chain disruptions during the pandemic to inflate prices, bolstering their profits. Senator Elizabeth Warren, a key advocate for increased competition and robust antitrust laws, led the call for an investigation. However, her proposed legislation to address the issue has largely been stalled in Congress.
Lawmakers Skeptical of Corporate Motives
Warren and other lawmakers hope Biden will use his executive power to probe alleged price-fixing practices by major grocery chains. She accuses large food companies of lobbying Congress to maintain these profitable practices, thus hindering Congressional efforts to alleviate family costs.
Proposals to Combat Rising Food Prices
Several proposals outlined in the letter suggested Biden could encourage the FTC to offer guidance on potential law violations and establish a joint task force to investigate price manipulation across the supply chain. As Biden seeks re-election, public dissatisfaction over escalating food prices, up 21% in three years, remain a significant issue.
Call for Regulatory Intervention
The letter underscores calls from progressive Democrats for regulatory intervention in the food and grocery sector to ensure fair competition and affordable prices. Studies indicate corporate profits account for over 50% of current inflation, causing hardships for American families. Dominance of the market by a few powerful retailers raises concerns over potential manipulation of supplier prices and terms.
Addressing Anti-Competitive Practices
The lawmakers propose that the Biden administration encourage the FTC to enact a rule under Section 5 of the FTC Act, aiming to curtail exclusionary contracting in the food industry. They also stress the importance of collaboration between regulatory bodies in investigating corporate practices that inflate consumer prices.
DOJ and FTC to Monitor Mergers and Acquisitions
The lawmakers also urge the DOJ and FTC to examine and potentially block mergers and acquisitions in the food and agricultural sectors to prevent further consolidation. The FTC has previously blocked a merger between two large grocery chains, Kroger and Albertsons, under Biden’s presidency.
White House Measures to Lower Grocery Costs
The Biden Administration has taken steps to decrease grocery costs, updating the Thrifty Food Plan to provide an extra $36 per month to low-income individuals on SNAP, and partnering with State attorneys general to tackle anti-competitive behavior and price gouging. Despite this, Warren and other Democrats are appealing to Biden to exercise his executive authority to bypass Congress and take further action.
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