Biden signs an order calling for a stronger scrutiny of the big business


WASHINGTON – President Biden signed a comprehensive executive order on Friday aimed at stimulating competition across the economy and encouraging federal agencies to take a wide range of measures, including a closer scrutiny of the tech industry, tackling the high fees charged by sea shippers and the approval of hearing aids that are sold over the counter.

“What we have seen in the last few decades is less competition and more concentration, which are slowing our economy,” said Biden on Friday shortly before signing the contract in the White House, citing the agricultural, technology and pharmaceutical industries. “Instead of competing for consumers, they consume their competitors. Instead of competing for labor, they find ways to gain the upper hand over the labor. “

The arrangement reflects the government’s increasing acceptance of warnings from some economists that declining competition is hampering the vitality of the economy, increasing prices and reducing choice for consumers in key areas, while at the same time dampening wages and freedom to change jobs for restricts workers. Progressive groups celebrated it, while some business groups harshly criticized it.

But Mr Biden may find challenges in countering this decline in competition in various sectors of the economy – including Silicon Valley, Wall Street, restaurant chains, and large hospital networks – through executive action alone. Experts warn that the president will have to work with Congress in many areas to change federal laws if he hopes to have more success than former President Donald J. Trump, who has also issued competitive executive orders and has had limited results.

In interviews earlier this week, senior administrative officials recognized the limits of executive power but said the order chose measures such as:

The contract comprises a total of 72 provisions that span different economic sectors. Part of the order will tell federal agencies approving mergers that they should update their business review guidelines to better capture Silicon Valley’s business models. Another calls on the Federal Communications Commission to reintroduce net neutrality rules for broadband providers. Another is calling on the Federal Trade Commission to discourage manufacturers from preventing farmers from repairing their tractors themselves.

Other parts will be focused on health care at multiple levels. The order will help states and tribal governments import inexpensive prescription drugs from Canada, push for regulations to be enacted this year to allow over-the-counter sales of hearing aids, and urge the FTC and the Department of Justice to scrutinize hospital mergers tougher ensure that patients are not injured as a result.

Another focus is on the companies that move people and goods around the world. The regulation suggests, for example, new rules for airline fees. The aviation industry consolidated significantly in the 2000s and early 2010s. A series of mergers and acquisitions created four major airlines that now serve nearly two-thirds of all US passengers. The ordinance also calls on the Federal Maritime Commission, an independent agency, to aggressively enforce the law against companies charging exporters high prices for shipping their products by sea.

The contract also has numerous parts that the White House says will benefit the workers. She encourages the FTC to prohibit or restrict non-compete obligations, which employers have increasingly tried in recent years to prevent their workers from quitting for a better job. He encourages the Commission to also ban “unnecessary” restrictions on work permits, which can limit the ability of workers to find a new job, especially across national borders. And he encourages both the Commission and the Ministry of Justice to further restrict employers ‘ability to exchange information on workers’ pay in a manner that could amount to collusion.

In a broader sense, the Implementing Regulation encourages antitrust authorities to consider how mergers could contribute to monopsony or industries where workers have few choices about where to work and therefore have no leverage to negotiate higher wages or better benefits.

The White House Economic Advisory Council cited several examples of such industries in an accompanying research letter on Friday, including beef packaging and airlines, each dominated by four large companies.

It will create a White House competition council, chaired by Brian Deese, director of the National Economic Council, who will “coordinate the federal government’s response to the growing power of big business in the economy,” officials said in a press release.

The order is a victory for progressive lawmakers and academics who say that state regulators, not holding back the growth of American businesses for decades, have subscribed to a conservative view that sets a high standard on when the government will block mergers or break up monopolies should. You have also criticized the Obama administration for not properly overseeing industry consolidation, particularly in Silicon Valley.

They say politicians must aggressively enforce and possibly rewrite antitrust laws. Without drastic action, they argue, consumers will have less choice, bigger business suppliers will come under pressure, and giant corporations will only get bigger.

Senator Amy Klobuchar, the Minnesota Democrat who heads the Senate Justice Antitrust Subcommittee and criticizes the concentration of power in the corporate world, called the order “groundbreaking.”

David Segal, executive director of Demand Progress group, said in a statement that the order “represents a wish list that Progressives and other proponents of competition have promoted for years, and in some cases for decades”.

The order was placed by a leading Washington business lobby group, the US Chamber of Commerce. Neil Bradley, the group’s executive vice president and chief policy officer, said the mandate was “built on the false belief that our economy is over-focused, stagnant, and not generating the private investment necessary to drive innovation. Such broad assertions are unrealistic because our economy has proven resilient and the world envies it. “

Mr. Biden has already brought some vocal critics of corporate power into leadership positions. At the White House, he appointed Tim Wu, a law professor at Columbia University and outspoken supporter of the liquidation of companies like Facebook, as special advisor on competition issues. He appointed Lina Khan to chair the Federal Trade Commission. Mrs. Khan worked on an antitrust investigation of the house against Amazon, Apple, Facebook and Google and wrote early in her career about the concentration in other industries such as confectionery and agriculture.

But Mr. Biden has not yet nominated a person to lead the Justice Department’s antitrust division, a key role in determining the government’s position on competition issues.

In the last few decades, federal courts have also taken a conservative stance in antitrust law in order to underline how difficult it can be for the order to have a lasting effect. Last month, a judge dismissed an FTC lawsuit arguing that Facebook violated antitrust laws in buying smaller competitors Instagram and WhatsApp, despite the judge giving the agency 30 days to re-file the case.

William J. Baer, ​​who headed the Justice Department’s antitrust division during the Obama administration, said courts often “carefully examine” the merger guidance to be updated in the implementing regulation. However, he noted that courts have generally become more conservative on antitrust issues and are more likely to reject business challenges.

“There is a headwind there that may or may not be overcome,” he said.

House lawmakers have come up with a handful of proposals to strengthen the agencies’ hands on big tech, but these bills are likely to meet stiff opposition. Many of the measures in the executive order do not necessarily require a congress to expand the agencies’ capabilities. In many cases, regulators have been reluctant to enforce existing laws and create new rules, said people familiar with the White House mindset.

One of the goals of the Executive Order is mergers, where big tech companies buy small businesses that could become tough competitors and wipe out a rival before it gets going. The guidelines encourage agencies to reconsider the guidelines they use to evaluate proposed deals, even if a company is buying a young competitor or a large set of data that could help it dominate.

The ordinance will also ask the FCC to introduce new restrictions on the practices of broadband Internet service providers such as Comcast, AT&T and Verizon. Activists have long said that consumers have too little choice and pay too much money for Internet services.

Mr. Biden will also encourage the FCC to reintroduce so-called net neutrality rules, which prevent Internet providers from blocking certain content, slowing down its delivery or making customers pay more so that their content can be delivered faster. The agency adopted the rules during the Obama administration and then withdrew them under President Donald J. Trump.

Mr. Baer, ​​the former Justice Department official, said while the Obama administration had begun to focus on White House competition policy in its dwindling days, Mr. Biden had the runway to make it a top priority.

“He has the time to pull this off,” said Mr. Bear.

Cecilia Kang and Niraj Chokshi contributed to the coverage.


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