Antitrust Is Now A Pillar Of Democrats' "Better Deal" And Rightly So

Last month I wrote a post saying that Democrats need to make antitrust enforcement a pillar of their economic strategy. In particular, I thought the Amazon/Whole Foods merger was an almost perfect case on which to make a stand, especially as it highlighted the dangers of online platforms exploiting their position to harm competitors in other markets. Surprisingly, at least to me, I received a significant amount of pushback on the issue, with many commentators feeling the issue was not really a significant problem.

In light of that, it was nice to see that Chuck Schumer has included antitrust as one of the three main points in the current "Better Deal" strategy that he laid out today. So far, the three parts of the plan are to create 10 million jobs through increased investment in infrastructure and tax credits for training and hiring workers at good wages. It also includes a crackdown on predatory pricing in the prescription drug industry and forcing Medicare to negotiate bulk deals with the prescription drug providers, further reducing costs. In a similar vein, the third plank attacks concentrated corporate power by changing the rules for mergers, requiring the businesses to prove the resulting company would be more competitive rather than the government having to prove the reverse. In addition, it adds a new regulatory oversight agency that can recommend prosecutions of what it determines to be anti-competitive behavior.

Stronger antitrust enforcement is a touchstone for many Democratic policies. Breaking up monopolies and oligarchies will actually create jobs because the resulting business will have to duplicate efforts in many areas. As an example, splitting one big bank into four will result in four companies with the required compliance departments. The increase in the number of jobs and the number of firms will also raise wages as there will actually be competition among those firms for qualified people. In addition, breaking up the oligopolies will reduce their political power. Yes, as an industry, their lobbying efforts won't be reduced but there will probably be far less of sweetheart lines of tax code specifically written to benefit just one company. Competitive industries have shown to have higher rates of investment as well, hopefully resulting in reducing the incentives for oligarchies to hide their profits off shore and pressure Congress to reduce taxes in order to repatriate them but rather actually put those profits to use. Lastly, a less concentrated industry removes at least some of the barriers to competition wishing to enter a specific market, which can be enormously high in some industries currently, and again increasing competition for jobs and hopefully higher wages.

Name one other policy position that can create jobs, raise wages, and reduce the political power of corporations. That is why antitrust enforcement needs to be a critical part of the Democratic message and why those elements of antitrust need to be harped on to the American people.

There will be more to come with the "Better Deal" plan. Schumer has opened up the possibility of supporting a single payer health plan. But, for now, this is at least a decent start.

Lastly, although Schumer kind of took a pot-shot at the Clinton campaign in his editorial today, if I'm not mistaken almost all three of these policies were in the Democratic party platform last year in some form and included in Clinton's campaign. The real problem is the message never made it beyond the obsession with the messenger.