One of the entrances to the Federal Trade Commission Building in Washington, DC, that serves as the headquarters of the Federal Trade Commission (FTC).
After first expressing worries, groups seeking to limit concentrated corporate power are now praising actions by the new leader of the Federal Trade Commission, one of two federal agencies tasked with ensuring a level economic playing field.
In statements in support of 2023 merger guidelines and in support of a case against health conglomerates, Andrew Ferguson, President Donald Trump’s appointee as chair of the FTC, seems to be sticking to the agency’s more aggressive course of the past several years.
Ferguson raised concerns in late January when his first official act was to attack work at the agency aimed at developing a diverse workforce. Referring to such efforts as “DEI,” Trump without evidence has blamed diversity programs for a host of problems — including a plane-helicopter crash over the Potomac River.
Antitrust activists worried that Ferguson would expound such Trumpian themes while unwinding the recent work of the FTC. After four decades of relative non-enforcement under Republican and Democratic presidents, the agencies more recently had been taking steps to block consolidation through such measures and stopping the proposed Kroger-Albertsons merger.
After attacking “DEI,” Ferguson last week reiterated his support for merger guidelines the FTC adopted in 2023.
“As we confront this merger wave together, I write to clarify the standards which should guide your review of transactions,” Ferguson said in a Feb. 18 memo. “Insofar as there is any ambiguity, let me be clear: the FTC’s and DOJ’s joint 2023 Merger Guidelines are in effect and are the framework for this agency’s merger-review analysis.”
This is seen as a big deal because since the start of the Reagan administration in 1981, the federal government largely took the brakes off of corporate mergers, making the argument that bigger companies would create better outcomes for consumers.
However, with giant conglomerates dominating multiple parts of ever-inflating health transactions, firms helping massive landlords artificially increase rents and a dominant few processors hiking meat prices, calls have arisen to get back to antitrust basics. One antitrust group, the Institute for Local Self Reliance, in 2023 described the basis of the new, stricter merger guidelines.
“To this end, Congress (in 1950) banned any merger where the effect ‘may be substantially to lessen competition… in any line of commerce,’” it said on its website. “As the law’s legislative history makes clear, lawmakers believed corporate concentration was both an economic and political danger — a reality that we are facing today. Concentrated corporate power threatened small businesses, workers, and the ability of people to control their lives and communities. To prevent these harms, Congress passed a law designed to head off industry consolidation ‘in its incipiency’ — long before it even gets started.”
Stacy Mitchell, the group’s founder, took to Bluesky to praise Ferguson for his statement.
“A piece of good news on the federal front that will surprise many: The new FTC Chair endorsed the 2023 Merger Guidelines, telling staff to use them to assess whether proposed mergers are illegal,” she said. “Many corporations had hoped/assumed the guidelines would be rescinded in the new administration.”
A Biden appointee to the trade commission also praised Ferguson’s stance in favor of the 2023 merger guidelines — and he did so after blasting the new chairman’s order regarding “DEI.”
“I think this is the clearest sign yet that antimonopoly isn’t for blue America or red America, and I think those guidelines are going to make a big difference for small business and labor, and I think that’s really exciting,” the commissioner, Alvaro Bedoya, said last week during an online event proposing to break up big health conglomerates.
Then on Tuesday, Ferguson took to X to praise a decision in federal court against CVS Health, one of the conglomerates the FTC is investigating.
“The @FTC just achieved a big win for Americans,” he wrote. “A federal court has ordered CVS and its pharmacy benefits manager to comply with our demands to turn over documents related to whether they are engaged in anticompetitive conduct.”
He added, “I have long said that if firms do not cooperate with our investigations, we should take them to court. The law is clear: Complying with our orders is mandatory.”
The agency is looking into whether CVS Health, UnitedHealth Group and Cigna-Express Scripts are using their dominance in several aspects of the insurance and health marketplaces to pad profits by artificially inflating drug costs.
The FTC has repeatedly accused CVS and the others of foot-dragging when it demanded documents for its investigations. In this case, it said CVS has ‘”made no meaningful progress toward compliance in the last seven months,’ failed to produce a single document since September, ‘repeatedly offered production target dates and then missed them,’ and continues to argue ‘that it should be exempted from producing any documents from the past year,’” U.S. District Judge John D. Bates of D.C. district wrote in his ruling. “Thus, CVS is not in compliance, and the FTC has no reason to trust its promise of future compliance. CVS’s promise of future compliance is not a reason for this Court to deny an otherwise sound enforcement petition.”
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