“As demand has increased and supply chains have become distorted during the economic recovery, this has enabled companies that have gained market power using illicit means to raise prices for consumers facing hardship. corporate monopolies.”
“It is imperative that corporate executives who engage in criminal antitrust activities like price fixing are prosecuted to the fullest extent of the law rather than being slapped on the wrist.”
February 9, 2022 – Washington, DC – U.S. Senator Elizabeth Warren (D-Mass.) wrote a letter to Attorney General Merrick Garland and Deputy Attorney General Lisa Monaco called on the DOJ to take more aggressive action against companies violating antitrust laws to raise prices for consumers. In the letter, Sen. Warren called out big poultry companies, big pharma and other industries notorious for their price-fixing schemes, which received only ineffectual penalties for their criminal antitrust activity. Senator Warren urges DOJ to prosecute executives who engage in price-fixing and other anti-competitive practices to help ease the burden Americans are feeling as inflation hits its highest level in decades , driven by companies passing on high costs and raising prices to inflate their bottom line.
“The nation is facing inflation at its highest level in decades, largely driven by corporate greed and anti-competitive behavior, and the federal government must use every tool available to prevent price gouging and reduce prices. for Americans. Antitrust policy plays a critical role in protecting consumers from anti-competitive practices that drive up prices, and no practice has a more direct effect on prices than price fixing,” said Senator Warren.
The Sherman Act makes price fixing and other forms of collusion illegal. However, in recent decades, the lack of competition and the increased concentration of the US economy have created the conditions for collusion. The DOJ itself has observed that “the fewer sellers there are, the easier it is for them to come together and agree on prices.” From 1997 to 2012, 75% of all industries consolidated.
Senator Warren previously sent a letter to the DOJ warning about price fixing in the poultry industry. Tyson recently agreed to pay $4.6 million to resolve allegations that he was involved in a “Turkish cartel” involving other companies such as Cargill, Perdue Farms and Butterball LLC. In January 2021, Tyson also agreed to pay $221.5 million to settle broiler chicken price-fixing allegations. Other large poultry companies have faced similar allegations. Price-fixing in the poultry industry has hit customers in their wallets, driving up the price of broiler chickens by nearly 50%, scamming American families about $330 a year, a lawsuit has found.
Many drug companies are responsible for colluding with manufacturers and conspiring to fix drug prices alongside competitors, but the DOJ has failed to prosecute the executives to the fullest extent possible. Often when the DOJ secures settlements, none of the criminal leaders are likely to spend time in jail, even if they have confessed to illegally defrauding the government and patients in need of drugs.
“For corporations and their billionaire executives, too often, crime pays. It is unconscionable that we seem to have two tracks of criminal justice in this country: one for the rich and powerful, and one for everyone else. Failure to enforce pricing and antitrust laws has a significant economic cost: as demand has increased and supply chains have become distorted during the economic recovery, it has allowed companies that gained market power through illicit means to raise prices for consumers in the face of corporate monopolies. I share the concern of the Deputy Attorney General of Monaco that, in the absence of strong and effective enforcement of antitrust laws, our current system perpetuates the belief among businesses that fines and settlements are just the cost Business “, continued Senator Warren.
As a champion of American consumers and a safe and healthy economy, Sen. Warren has continued to scrutinize businesses for their role in driving up prices for consumers as Americans face record-high inflation nationwide. economy.
- On January 13, 2022, Senator Warren asked Federal Reserve nominee Lael Brainard about market concentration and price hikes fueling inflation.
- At a hearing in January, Senator Warren pressed Fed Chairman Jerome Powell on the role of corporate concentration in driving up prices for consumers during his nomination hearing for President of the Council of Federal Reserve governors.
- In December 2021, Senator Warren called on Secretary Raimondo to use Flea Law for America funding to ward off industry consolidation in the semiconductor industry, improve supply chain resilience, and enhance industry competitiveness. The global chip shortage has led to major price increases for American families and contributed to recent increases in inflation, as well as job losses due to auto plant closures.