Binyamin Appelbaum | Monopoly’s Bad Cousin – The New York Times

By Binyamin Appelbaum

Mr. Appelbaum is a member of the editorial board.

“The nation’s antitrust police, asleep for the past few decades, barely opening their eyes to buzz through the latest corporate mergers, finally seem to be emerging from their slumber. That is a very good thing for the American economy.

This month the Justice Department filed suit to prevent Penguin Random House from buying the rival book publisher Simon & Schuster. It’s the most interesting antitrust action in a long time. In pursuing the case, the Biden administration is attempting to break out of a cage that has constrained antitrust enforcement since the 1980s.

The power of large corporations can warp the economy in several ways. The most familiar is that companies with monopoly power can impose higher prices on consumers. To the extent federal antitrust regulators have done anything in the past few decades, they have objected to deals that seemed likely to result in higher prices.

But big companies also can pad profits by squeezing their workers and suppliers, and they can influence politicians to entrench their advantages.”

Binyamin Appelbaum | Break Up Big Chicken – The New York Times

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By Binyamin Appelbaum

Mr. Appelbaum is a member of the editorial board.

“President Biden wants to lead a revival of antitrust enforcement, a campaign aimed most obviously at curbing the behavior of feral tech companies.

But Mr. Biden can’t achieve his goal of expanding fair competition in the United States solely by wrangling with Big Tech. To succeed, he’ll need to confront Big Chicken, too.

Most chicken that Americans eat is processed by a handful of big companies because, in recent decades, the government gave its blessing to the consolidation of poultry processing, along with a wide range of other industries. The unsurprising result: In recent years, the surviving companies took advantage of their market power to prop up the price of chicken, overcharging Americans by as much as 30 percent.

Evidence of the industry’s misconduct became so blatant — thanks in part to lawsuits filed by wholesale poultry buyers — that regulators were roused from complacency. Beginning in 2019, the government has filed a series of charges against the companies and their executives.”

Excellent piece, and also good comments, such as:

J

Jack Sonville

Florida9h ago

I’ve been in Corporate America board rooms for 35 years and much of that in older, more established industries. In general, they do not have the innovation DNA of an Amazon or an Apple or a Google. Over the years they have gutted their R&D functions to save money and essentially use a commodity business model–try to be a low cost provider, take higher-cost capacity (supply) out of the market, and charge as high a price as possible whenever possible. So in response to Wall Street pressure to significantly grow, they really only have one option: Buy their competitors and consolidate their industry. This allows them to find “synergies”, which in antitrust-speak is supposed to mean lower prices and other benefits to the consumer, but which really means reducing cost by firing employees made redundant by the merger of two companies, and then taking more capacity out of the market and/or using their now-greater market share to raise price. It’s been frustrating to watch, over virtually my entire career, the same story play out time and again. Companies tell the DOJ and FTC in their antitrust filings that consumers will benefit from these mergers, but they rarely if ever do. And government economists buy the story. These mergers generally reduce incentive for innovation, eliminate jobs, put downward pressure on industry compensation, and lead to higher prices through reduced capacity. Good for shareholders? Maybe. Good for consumers? Almost never.

3 Replies207 Recommended

Nelson Lichtenstein | Biden’s Executive Order Restores U.S. Antitrust – The New York Times

By Nelson Lichtenstein

Mr. Lichtenstein is a professor of history at the University of California, Santa Barbara, where he directs the Center for the Study of Work, Labor and Democracy.

“On Friday, President Biden signed a sweeping executive order intended to curb corporate dominance, enhance business competition and give consumers and workers more choices and power. The order features 72 initiatives ranging widely in subject matter — net neutrality and cheaper hearing aids, more scrutiny of Big Tech and a crackdown on the high fees charged by ocean shippers.

The president called his order a return to the “antitrust traditions” of the Roosevelt presidencies early in the last century. This may have surprised some listeners, since the order offers no immediate call for the breakup of Facebook or Amazon — none of the trustbusting that is antitrust’s signature idea.

But Mr. Biden’s executive order does something even more important than trustbusting. It returns the United States to the great antimonopoly tradition that has animated social and economic reform almost since the nation’s founding. This tradition worries less about technocratic questions such as whether concentrations of corporate power will lead to lower consumer prices and more about broader social and political concerns about the destructive effects that big business can have on our nation.”

The Amazon That Customers Don’t See – The New York Times

“LAST SEPTEMBER, Ann Castillo saw an email from Amazon that made no sense. Her husband had worked for the company for five years, most recently at the supersize warehouse on Staten Island that served as the retailer’s critical pipeline to New York City. Now it wanted him back on the night shift.

“We notified your manager and H.R. about your return to work on Oct. 1, 2020,” the message said.

Ms. Castillo was incredulous. While working mandatory overtime in the spring, her 42-year-old husband, Alberto, had been among the first wave of employees at the site to test positive for the coronavirus. Ravaged by fevers and infections, he suffered extensive brain damage. On tests of responsiveness, Ms. Castillo said, “his score was almost nothing.” “

David Lindsay: An excellent aritcle. I hope you read it all, and join me in my boycott of Amazon and Jeff Bezos, What a space flying monster.

Opinion | This Peeler Did Not Need to Be Wrapped in So Much Plastic – The New York Times

By Pamela L. Geller and Christopher Parmeter

Drs. Geller and Parmeter are associate professors at the University of Miami.

April 5, 2021          551

Credit…Illustration by Nicholas Konrad/The New York Times; photograph by Getty Images

“The year 2020 may have been heartbreaking for most humans, but it was a good one for Jeff Bezos and Amazon. His company’s worldwide sales grew 38 percent from 2019, and Amazon sold more than 1.5 billion products during the 2020 holiday season alone.

Did you need a book, disposable surgical mask, beauty product, or garden hose? Amazon was probably your online marketplace. If you wanted to purchase a Nicolas Cage pillowcase or a harness with leash for your chicken, Amazon had your back (They’re #17 and #39 on a 2019 Good Housekeeping list of the 40 ‘weirdest” products available on the website “that people actually love.”) From pandemic misery came consumer comfort and corporate profit.

And plastic. Lots and lots of plastic.

In 2019, Amazon used an estimated 465 million pounds of plastic packaging, according to the nonprofit environmental group Oceana. The group also estimated that up to 22 million pounds of Amazon’s plastic packaging waste ended up as trash in freshwater and marine ecosystems around the world. These numbers are likely to rise in 2021.” . . .

Mark Pryor | F.D.R. Took Down Giants. Biden Can, Too. – The New York Times

By Mark Pryor

Mr. Pryor, a lawyer, is a Democrat who was a U.S. senator from Arkansas from 2003 to 2014.

March 29, 2021

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Credit…George Wylesol

“During his nomination hearing, Attorney General Merrick Garland said he would “vigorously” enforce U.S. antitrust law. As the Biden administration actively considers who will lead that enforcement effort as the head of the Department of Justice’s antitrust division, they should look to the legacy of Franklin Delano Roosevelt for inspiration.

Often overlooked in comparison to other aspects of his presidency, President Roosevelt’s push to revive languishing antitrust enforcement helped set the United States back on the right track, creating job and wealth opportunities for Americans at one of the lowest points in the nation’s history.

The reinvigoration of antitrust enforcement helped usher in an era of entrepreneurship and small-business growth. The United States was able to assert itself as a global economic leader, establishing a model of corporate decentralization that would be adopted by democratic nations across the world. But reinvigorating antitrust did not come without substantial opposition from business interests as well as judicial and enforcement bodies that lost their way. Indeed, Roosevelt’s plans were only as strong as the people he appointed to turn his vision of an open market economy into reality.” . . .

How Amazon Crushes Unions – The New York Times

By David Streitfeld

• March 16, 2021, 5:00 a.m. ET

“RICHMOND, Va. — Five years ago, Amazon was compelled to post a “notice to employees” on the break-room walls of a warehouse in east-central Virginia.

The notice was printed simply, in just two colors, and crammed with words. But for any worker who bothered to look closely, it was a remarkable declaration. Amazon listed 22 forms of behavior it said it would disavow, each beginning in capital letters: “WE WILL NOT.”

“We will not threaten you with the loss of your job” if you are a union supporter, Amazon wrote, according to a photo of the notice reviewed by The New York Times. “We will not interrogate you” about the union or “engage in surveillance of you” while you participate in union activities. “We will not threaten you with unspecified reprisals” because you are a union supporter. We will not threaten to “get” union supporters.”

Amazon posted the list after the International Association of Machinists and Aerospace Workers accused it of doing those very things during a two-year-long push to unionize 30 facilities technicians at the warehouse in Chester, just south of Richmond. While Amazon did not admit to violations of labor laws, the company promised in a settlement with federal regulators to tell workers that it would rigorously obey the rules in the future.

Opinion | Amazon and the Breaking of Baltimore – The New York Times

” . . . At its peak in 1958, the Beth Steel plant on the Point employed some 30,000; in its final years at the turn of this century — even as imports, domestic “mini-mills” and feckless management threatened its existence — veteran workers were still making at least $35 per hour, with excellent union benefits. The work was strenuous and frequently dangerous, but also purposeful and well-paid enough that many people spent their whole career there.

Since the plant closed in 2012, the Point has been wiped clear of virtually all traces of it. Starting in 2017, a new sort of work filled the void: logistics. The Point’s new owners leased land to first one and then a second Amazon fulfillment center, as well as warehouses for Under Armour, FedEx, Home Depot and Floor & Décor.

The work at Amazon was physically taxing in its own right, and was far more socially isolating than the foxhole camaraderie that had characterized Beth Steel, which helped explain why turnover was so much higher at the warehouse than during the steel years.

“It was a family thing — they looked out for one another,” said Bill Bodani Jr. of his time at Beth Steel, where he lasted three decades despite several workplace accidents. By the time he left in 2003 he, too, was drawing $35 an hour.

Over a decade later he went back to work at the Point, driving a forklift at Amazon. His pay was around $15 an hour. He lasted only three years with the company, after clashing with a supervisor over his bathroom breaks and his encouragement of labor organizing among the younger workers.” . . .

Thomas Friedman | Made in the U.S.A.: Socialism for the Rich. Capitalism for the Rest. – The New York Times

“. . . There has been so much focus in recent years on the downsides of rapid globalization and “neoliberal free-market groupthink” — influencing both Democrats and Republicans — that we’ve ignored another, more powerful consensus that has taken hold on both parties: That we are in a new era of permanently low interest rates, so deficits don’t matter as long as you can service them, and so the role of government in developed countries can keep expanding — which it has with steadily larger bailouts, persistent deficit spending, mounting government debts and increasingly easy money out of Central Banks to finance it all.

This new consensus has a name: “Socialism for the rich and capitalism for the rest,” argues Ruchir Sharma, chief global strategist at Morgan Stanley Investment Management, author of “The Ten Rules of Successful Nations” and one of my favorite contrarian economic thinkers.

“Socialism for the rich and capitalism for the rest” — a variation on a theme popularized in the 1960s — happens, Sharma explained in a phone interview, when government intervention does more to stimulate the financial markets than the real economy. So, America’s richest 10 percent, who own more than 80 percent of U.S. stocks, have seen their wealth more than triple in 30 years, while the bottom 50 percent, relying on their day jobs in real markets to survive, had zero gains. Meanwhile, mediocre productivity in the real economy has limited opportunity, choice and income gains for the poor and middle class alike.” . . .

NYT Editorial | Visa Is Doing What Big American Companies Do to ‘Protect This Business’ – The New York Times

By The Editorial Board

The editorial board is a group of opinion journalists whose views are informed by expertise, research, debate and certain longstanding values. It is separate from the newsroom.

• Dec. 2, 2020

Credit…Illustration by Nicholas Konrad/The New York Times; photograph by Getty Images

“Visa dominates the lucrative business of processing debit card transactions. Merchants must choose between paying the financial services company’s fees or forgoing sales to the millions of Americans who carry cards emblazoned with Visa’s logo.

A San Francisco technology start-up named Plaid threatened that dominance. The company planned to debut a rival service next year that would charge half as much as Visa.

So Visa did what big American companies have learned to do: It agreed to buy the smaller company, pledging a king’s ransom to eliminate the threat of competition.

Last month, the Justice Department sued to block the deal as a violation of antitrust law. The intervention is necessary to protect the interests of merchants and consumers, and the health of the broader economy. The federal government has been far too permissive in allowing large companies to swallow potential rivals, particularly in the rapidly evolving technology sector.”