WASHINGTON — President Joe Biden signed a sweeping
executive order on Friday to promote more competition in the US economy, urging
agencies to crack down on anti-competitive practices in sectors from
agriculture to drugs and labor.
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If fully implemented, the effort will help lower Americans'
internet costs, allow for airline baggage fee refunds for delayed luggage, among
other steps.
The order instructs antitrust agencies to focus on labor,
healthcare, technology and agriculture as they address a laundry list of issues
that have irritated consumers, and in the case of drug prices, has bankrupted
some.
"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," Biden said at a White House signing
ceremony.
The president noted areas where 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% 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.
Lower wages caused by lack of competition are estimated to
cost the median American household $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
US 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."
Internet, hearing aids
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.
Biden's order pushes the Agriculture Department to act to
stop what the White House called "abusive practices of some meat
processors," reacting to farmers and ranchers who sometimes say they face
too few buyers for their animals.
The administration also seeks to make it easier for
customers to switch banks and take their transaction data with them, and
restore net neutrality rules that require companies to treat all internet
services equally.
Reuters first reported Biden's plan to issue a competition
executive order in late June and subsequently published stories on how it will
impact industries such as farm equipment manufacturers, banking, rail and sea
shipping.
The executive order will direct the Department of Justice
and Federal Trade Commission (FTC) to carefully review mergers, and to
challenge prior deals that have closed.
It directs the FTC to issue rules to address competition
concerns from Big Tech companies, Facebook, Apple, Alphabet's Google and
Amazon, and limit "killer acquisitions" where large internet
platforms acquire potential competitors.
FTC Chair Lina Khan and the acting head of the U.S. Justice
Department Antitrust Division, Richard Powers, said Friday that they would soon
launch a review of merger guidelines to determine if they are "overly
permissive."
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 cooperate with any program. He said the government's decision
to turn to executive orders on drug pricing was surprising given ongoing
legislative efforts in Congress.
The executive order also establishes a White House
Competition Council, led by the Director of the National Economic Council and
including many cabinet secretaries, to monitor progress.
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