New PPI Report Warns That Antitrust Can be Doing More to Protect Consumers From Higher Prices and the High Cost of Living

December 10, 2024
Diana Moss

WASHINGTON — High prices for essential goods and services force consumers to make tough choices about what to buy, where to live, and even what bills to pay. Anger around high prices and the high cost of living played a major role in the 2024 presidential election. Disillusionment with the “Bidenomics” agenda fueled a sense of disenfranchisement. Namely, the struggle to afford the necessities that account for most of consumers’ budgets were de-prioritized in favor of proposals to pay off college student loans, green the economy at substantial cost, and other policies that do not ease financial burdens for working class Americans.

Today, the Progressive Policy Institute (PPI) released a new report, “Can Antitrust Be Doing More to Protect Consumers?,” authored by Diana L. Moss, Vice President and Director of Competition Policy at PPI. Market power is an important contributor to higher prices in critical sectors that make up the bulk of consumer spending. The report unpacks evidence of high market concentration, flagging productivity, market power “bottlenecks,” and lackluster merger control in critical sectors such as housing, transportation, food, insurance, and health care.

“PPI’s findings highlight the need to rethink antitrust priorities to more directly and effectively protect consumers,” said Moss. “We know that antitrust enforcers make hard choices about what cases they pursue. But our analysis shows that enforcement could be doing a better job of championing the interests of consumers. We propose that enforcers prioritize sectors where high prices hit consumers hard in their pocketbooks and drive up their already high cost of living.”

PPI’s analysis highlights the vital role of antitrust — especially stronger and more coordinated merger enforcement — in key sectors that account for the bulk of consumer spending. The report suggests several priorities that would sharpen antitrust priorities and bring it into closer touch with consumers, including:

The U.S. antitrust agencies should stop “splitting up” merger reviews for transactions in different parts of the food and health care supply chains. Oversight of all consolidation in these sectors should be assigned to one agency to ensure that competitive dynamics along a supply chain are fully accou
The antitrust agencies should revisit policy to approve virtually all retail grocery mergers subject to divestitures. Failed divestitures have unfairly transferred the burden of anticompetitive mergers to consumers through higher food prices. Reversing this damage will require concerted policy action moving forward.
The antitrust agencies should consider the impact of harmful consolidation and business practices on the stability and resiliency of supply chains. Consolidation in “intermediary” markets that are prone to market power bottlenecks have not been adequately addressed.
Agencies should organize public workshops to deepen their understanding of changes in business models, supply chains, and bargaining power in major consumer-facing supply chains over time.

“Competition is the lifeblood of a healthy market system,” said Moss. “To ensure it thrives, and consumers reap the benefits of competition. We should reevaluate antitrust priorities to provide more direct and effective relief in sectors that have the most impact on their budgets.”

Read and download the report here.

The Progressive Policy Institute (PPI) is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Learn more about PPI by visiting progressivepolicy.org. Find an expert at PPI and follow us on Twitter.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org