One of the entrances to the Federal Trade Commission Building in Washington, DC, that serves as the headquarters of the Federal Trade Commission (FTC).
The high cost of everything might have been a major issue in last year’s presidential campaign. But when Andrew N. Ferguson took the helm last week at the Federal Trade Commission, his first act wasn’t to announce new ways to crack down on corporate practices thought to be unfairly driving up consumer prices for everything from food to housing to medicine to entertainment.
Instead, it was to say that federal efforts at diversity and inclusion were a “scourge” and that his first official act would be to close the agency’s office that was intended to create a more diverse workforce. He said such efforts were a scourge because they stoked “tensions by elevating race and other immutable characteristics above merit and excellence.”
“The Biden-Harris Administration reveled in this pernicious ideology,” Ferguson’s statement said. “They encouraged it, and it has festered within the federal government for four years.”
Ferguson’s office said it had nothing to add when asked how getting rid of the agency’s diversity and inclusion office would end abusive practices by mega-corporations and bring down prices for consumers. This was in spite of the fact that President Donald Trump on the first day of his presidency issued an executive order that all government agencies work to relieve suffering consumers.
Since Trump’s election on Nov. 5, observers have speculated about what his administration would actually do regarding antitrust enforcement, and Ferguson’s first act might shed some light.
Diversity and inclusion efforts might be turning into an all-purpose scapegoat for the new administration.
Trump on Thursday blamed attempts at diversity by the Federal Aviation Administration for a mid-air collision over the Potomac River that killed scores near Washington, D.C. The investigation was just beginning, and Trump offered no evidence to support his claim.
Meanwhile, others have for years been offering evidence that concentrated corporate power might be making average Americans worse off.
Since about 1980, many laws aimed at protecting small businesses, consumers and farmers haven’t been enforced on the rationale that the resulting corporate consolidation would create efficiencies that are better for consumers in the long run.
More recent experience has led many to question that, however. For example, research from last year suggests that when retail giant Walmart moves to a community, it makes the average resident poorer because it drives out small businesses that pay better wages — and the difference swamps whatever savings customers enjoy, The Atlantic reported.
In other industries, a few players have become so dominant that they’ve raised suspicions that they’re forcing out competition, in part by forcing suppliers to give them better deals than their smaller competitors.
After 40 years of non-enforcement, the FTC under Biden revived enforcement of a law prohibiting that — the Robinson Patman Act of 1936. In December, the agency sued the nation’s largest wine-and-spirits distributor, Southern Glazer’s, alleging that it was giving substantially better terms to its biggest customers and thus violating the law.
In recent years, the FTC has also brought suit in other sectors, accusing Amazon of abuses in online retail, and John Deere of not sharing computer codes with farmers so they can repair their own implements.
The agency also sued — and last year stopped — the merger of two grocery giants, Ohio-based Kroger and Albertsons, saying that the resulting mega-grocer would only exacerbate high grocery prices by sapping feeble retail competition even further. That’s after the FTC last March accused Kroger, Amazon and Walmart of exploiting supply-chain kinks during the pandemic to artificially raise food prices — and profits.
Alvaro Bedoya, a Biden appointee to the commission, last week cited those actions in a dissent from Ferguson’s first act. He accused the new chair of playing up one Trump priority — ending diversity programs — while ignoring another that is at the core of the FTC’s mission.
“Andrew Ferguson could have made his first public act as Chairman a motion to study the rising cost of groceries,” Bedoya wrote. “He could have acted on a pending public petition from a group of wall and ceiling contractors to investigate how lawbreaking contractors can effectively rig contract competitions in the commercial construction industry.”
In his Jan. 20 executive order to bring relief to average Americans, Trump told agency heads to find ways to bring down the cost of “fuel, food, housing, automobiles, medical care, utilities, and insurance.” He spent much of the order blaming Biden and unspecified government regulation for those costs, but he also ordered subordinates to “eliminate unnecessary administrative expenses and rent-seeking practices that increase health care costs.”
That could be a reference to massive health conglomerates whose pharmacy middlemen are accused of jacking up drug prices far in excess of the value they add. Last September, the FTC sued the companies over the way they conduct insulin transactions.
Trump in December slammed pharmacy middlemen just as the toughest regulations of the health care giants were built into a bipartisan spending package. But after billionaire allies Elon Musk and Vivek Ramaswamy criticized the package, Trump threw his support behind a new deal in which the new regulations were stripped out.
In his dissent to Ferguson’s first order, Bedoya, the FTC commissioner, appeared to be throwing down the gauntlet to Ferguson and, by extension, Trump.
Ferguson “could have moved to investigate a pending public petition from shrimpers from Louisiana, Mississippi, and Alabama to investigate potentially false and misleading claims about shrimp imports from India that are farmed with forced labor and shot full of antibiotics,” Bedoya wrote. “Chairman Ferguson could have done any number of things to actually lower the cost of living and create opportunities for American businesses and workers. He did none of them. Instead, he cancelled ‘DEI.’”
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