Senator Elizabeth Warren (D-MA) asserted that sector consolidation and concentration have become challenges to market competition. She recommended numerous solutions to what she called a "concentration problem."
Senator Warren summarized past situations in which concentration has resulted in less competition, fewer consumer choices and an increase in undivided political power. In order to minimize concentration, Senator Warren asserted, the U.S. Department of Justice and the Federal Trade Commission must "reinvigorate antitrust law" by doing the following:
- "holding the line on anticompetitive mergers" by refusing mergers that raise "fundamental antitrust concerns," instead of allowing the mergers to go forward if certain conditions are met;
- scrutinizing vertical mergers closely for vertical monopolies, and revisiting the applicable guidelines; and
- requiring all agencies, particularly the FDIC and the Federal Reserve, to promote market competition by "making sure that financial institutions don't become so large that their smaller competitors don't have the opportunity to serve American families and small businesses."
In addition, Senator Warren contended, concentration is not only costly and inefficient, but also "plays right into the hands of the big guys, who can afford to throw armies of lawyers at the regulatory process." She argued that the "big players" do so at the expense of "small players":
Small players end up having to shoulder regulatory compliance costs that make it even harder for them to compete, while big players use their resources and political clout to win loopholes, carveouts, and rollbacks that favor themselves and make it even harder for new competitors to survive. Over time, the result is a trifecta: more intrusive government, more concentration, and less competition.
Senator Warren delivered her remarks at New America's Open Markets Program Event.
Commentary
Independently of any developments in antitrust law, the Senator should ask what can be done right now to reduce the burdens of regulation. As to solutions for the "concentration problem," it would be useful if Senator Warren advocated the unqualified lightening of regulatory millstones immediately.
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