Salem Radio Network News Saturday, July 31, 2021

Business

Biden to sign order to promote competition in U.S. economy

By Nandita Bose and Jarrett Renshaw

WASHINGTON (Reuters) -President Joe Biden will sign a sweeping executive order on Friday to promote more competition in the U.S. economy, urging agencies to crack down on anti-competitive practices in sectors from agriculture to drugs and labor.

If fully implemented, the effort will help lower Americans’ internet costs, allow for airline baggage fee refunds for delayed luggage and cut some prescription drug prices, among other steps.

The White House says the rate of new business formation has fallen by almost 50% since the 1970s as large businesses make it harder for Americans with good ideas to break into markets.

Biden’s action is a sweeping order that goes after corporate monopolies across a broad swath of industries, and includes 72 initiatives he wants over a dozen federal agencies to act on.

Antitrust agencies will be told to focus their enforcement in the labor, healthcare, technology and agriculture sectors as they address a laundry list of issues that have irritated consumers, and in some cases resulted in significant economic harm.

Lower wages caused by lack of competition are estimated to cost the median American household $5,000 per year, according to a White House fact sheet that cites research from the American Economic Liberties Project – an influential Washington-based anti-monopoly group.

Biden’s order includes many politically popular ideas that aides say will help boost wages and lower prices for Americans, but will still take time to implement and will face resistance from industry.

Among the administration’s plans to open up the U.S. economy are new rules to mandate ending excessive internet contract termination fees, allow hearing aids to be sold and end non-compete clauses for millions of workers and many licensing requirements.

White House economic adviser Bharat Ramamurti told Reuters the order is “about going to the maximum extent that the agencies can within their existing authority” to boost competition.

He said while the Obama administration “got the ball rolling in 2016” that “President Biden is doing this at the beginning of his administration, which gives his agencies more time to execute on the orders here.”

Biden will push the Agriculture Department to act to stop what the White House called “abusive practices of some meat processors,” reacting to farmers and ranchers who sometimes say they face too few buyers for their animals.

The administration also seeks to make it easier for customers to switch banks and take their transaction data with them, and restore net neutrality rules that require companies to treat all internet services equally.

Reuters first reported Biden’s plan to issue a competition executive order in late June and subsequently published stories on how it will impact industries such as farm equipment manufacturers, banking, rail and sea shipping.

The executive order will direct the Department of Justice (DOJ) and Federal Trade Commission (FTC) to carefully review mergers, and to challenge prior deals that have closed.

It directs the FTC to issue rules to address competition concerns from Big Tech companies, Facebook, Apple, Alphabet’s Google and Amazon, and limit “killer acquisitions” where large internet platforms acquire potential competitors.

On prescription drugs, it aims to lower prices for consumers by allowing importation of drugs from Canada, where they are cheaper. It also urged the Department of Health and Human Services to draw up a plan to fight high drug prices, and gouging.

Evercore/ISI analyst Michael Newshel said in a research note that the impact of allowing imports from Canada on pricing would be limited given Canada’s limited drug supply and that Canada has indicated in the past that it would not cooperate with any program. He said the government’s decision to turn to executive orders on drug pricing was surprising given ongoing legislative efforts in Congress.

The executive order also establishes a White House Competition Council, led by the Director of the National Economic Council, to monitor progress on finalizing the initiatives in the order.

Biden will deliver remarks and sign the executive order at 1:30 pm ET (1730 GMT).

(Reporting by Nandita Bose and Jarrett Renshaw in Washington; Additional reporting by Diane Bartz, Caroline Humer and David Shepardson; Editing by Chizu Nomiyama and Alistair Bell)

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