In July US President Joseph Robinette Biden Jr. signed an executive order for the purpose of “Promoting Competition in the American Economy.” Many have seen this as a potential avenue for significant reform throughout the US economy including the breaking up of monopolies and creation of “right to repair” laws. But how much change should we really expect?
With the signing of the “Executive Order on Promoting Competition in the American Economy,” Biden took a step towards reform that the US economy desperately needs. In terms of monopolies, the US has seen about 75 percent of its industries experience concentration into the hands of only a few companies (yes companies have hands, they’re people after all). Just some quick facts for those that may be skeptical that there is truly increasing monopolistic practices in the US: Four companies now control 70 percent of domestic airline flights, three companies hold power of 80 percent of telecoms, one company (Vertex Pharmaceuticals) has the cornered the entire market with a cystic fibrosis drug. It is the only drug to treat the disease’s root cause that is FDA-approved, 85 percent of US corn seed in America is sold by only four companies, that number is 75 percent for soybeans, and the list goes on and on.
To truly break up these monopolies and ensure that companies aren’t ripping off the American people then running out the back with a bag full of unpaid taxes, it will certainly take more than one executive order. However, it does seem, if implemented correctly and backed up with actual enforcement, that the order could have some serious impact on increasing competition in the United States.
Biden’s executive order calls for increased scrutiny over market co-optation in a large variety of industries from local newspapers to broadband providers, airlines to prescription drugs, distilleries, shipping containers, farmers, and many more (the full text of the executive order can be read here). This has given many hope for true competition in the future, as well as increased consumer freedoms.
One is example of this is the push for “right to repair” laws. It is also simply heartening to see a United States’ president calling out monopolies instead of listening to their lobbyists, Biden wrote, “the answer to the rising power of foreign monopolies and cartels is not the tolerance of domestic monopolization, but rather the promotion of competition and innovation by firms small and large, at home and worldwide.” While I do personally think that sometimes the answer to the answer to monopolies abroad is state-controlled monopolies at home (of course this depends on the industry), at least this is a start. Large monopolistic corporations are a threat to democracy and subvert the will of the people, some politicians will even readily admit it.
Reading through the first handful of sections of the bill is mostly rehashing or calling for increased oversight and implementation of already existing laws. These include the Packers and Stockyards Act, the Clayton Antitrust Act, and the Sherman Antitrust Act, just to name a few. These are generally positive acts that should have already been being implemented, however with all of the monopolistic action taking place in the US, it seems they haven’t been for some time. Thankfully, this executive order goes beyond just telling Biden’s subordinates to do the jobs they should have already been doing.
One way the act seeks to correct these practices is to set up a new committee. Section 4 establishes the White House Competition Council. The council’s purpose is to investigate and report on market consolidation, amongst the other things called for in the first three sections of the order. It is also tasked with working with various other agencies throughout the US government to identify issues and produce strategies to deal with the corrupt practices. This includes coming up with recommended actions and even proposed legislation to help mitigate and repair these issues. Though subsection (d) of Section 4 states that the council is forbidden from discussing “any current or anticipated enforcement actions,” which seems to de-fang the committee, at least a bit.
This Competition Council will be comprised of members of numerous agencies throughout the executive branch including the Secretaries of the Treasury, Agriculture, Commerce, Labor, Heath and Human Services, Transportation, the Attorney General, the Administrator of the Office of Information and Regulatory Affairs, and “the heads of such other agencies and offices as the Chair may from time to time invite to participate.” The Chair of the Council will be the Director of the National Economic Council, who will share some leadership with the Assistant to the President for Economic Policy. This is where I get a bit more nervous about how the plan will actually be implemented.
The head of this new council being the Director of the National Economic Council may seem to make sense, this is until you find out who it is. The current director is Brian Christopher Deese, perhaps not a household name, but he doesn’t have the most conducive past for breaking up monopolies. Deese worked for the Center for American Progress (CAP) early on in his political career. Many politically-minded people will know this organization, most worker first-minded readers will likely have a bad taste in their mouths for it. CAP has a history of working with big business at the expense of working class people, and doing their best to throw progressives under the bus at every turn. It should be unsurprising then that after his time at CAP he moved on to work on the 2008 Hilary Clinton campaign, disgusting I know. When Hilary failed to obtain the nomination, Deese just moved into the Obama campaign to work as an economic adviser and eventually joined the Economic Policy Working Group to help with Obama’s transition to the presidency. While working for the Center for American Progress and two centrist, status-quo loving presidential hopefuls would be enough for me to be worried about the job Brian is going to do, it gets worse.
The most disturbing place that the new Director of the National Economic Council worked was not the White House, I know it’s hard to believe, he also worked at BlackRock. For those that don’t know, BlackRock is a massive investment firm that got much of its start managing pensions. They have greatly expanded since their founding in the late 1980s, with some now labeling them as a “shadow bank,” due to their size and influence on global capital. Some may find hope in the fact that during his time at the company, Deese was the “Global Head of Sustainable Investing,” which certainly sounds like something America desperately needs to do. However, the US also needs to divest from fossil fuels, something it seems BlackRock is at least hesitant to do as they are still the world’s leading investor in non-renewable energy. Likewise disconcerting is that Deese received a salary of over $2.3 million and had the opportunity to obtain another $2.4 million in stock plans through the company, likely meaning that he has many good friends still at the firm.
A brief video explaining just how powerful BlackRock is.
Here is a longer form interview that gives Brian more of a chance to explain his side, am I not merciful?
This is not to say that Deese will not do his job as director, however it does lead one to worry, at least a bit. His nomination seems to be more of the same from Washington. People are put into positions of power where they have experience, unfortunately that experience was often used to crush working class people and expand the coffers of the rich. So it seems dubious at best that they would be able, let alone willing, to reverse the damage they themselves have done. Biden might have learned this from Obama, but this practice has been business as usual in the Beltway for a long time. It probably had nothing to do with the fact that Joe Biden was the top recipient of BlackRock bribes, I mean campaign contributions in 2020. I’d like to tell you the other members of the council are clean of any potential corruption and will hold their Chair’s feet to the fire, but I can’t in good faith do that.
I will say that, of the lot, it seems that Thomas James Vilsack, the US Secretary of Agriculture seems to be the least detestable. He has, unfortunately in my opinion, advocated for the continued availability of “pink slime” from cow carcasses in schools. However, it does seem to make some sense for an Ag Secretary to defend the beef industry. While still kind of gross, and a potential for corruption, the other members of the council are much worse unfortunately.
I will try to keep this brief, however I believe it is important for accountability’s sake not to whitewash the corruption that could taint these council members. Pete Buttigieg, Secretary of Transportation, took millions of dollars from the same giant monopolies that he would be tasked with regulating. Secretary of Labor and former Boston Mayor, Marty Walsh, gave millions of dollars to a consulting firm where his girlfriend works. Gina Raimondo, former venture capitalist and Secretary of commerce, received over $1.6 million in “loser bonuses” from a venture capital firm she co-founded. Current secretary of Defense, Lloyd J. Austin III , was blessed with nearly $2 million from Raytheon, which has certainly been monopolizing the weapons market. Janet Yellen, Treasury Secretary, has received $7.2 million from giant corporations that she would be supposedly regulating in her seat on the council. The Secretary of Health and Human Services, Xavier Becerra, has received millions from multinationals in campaign contributions.
As it is plain to see, this is a clear continuation of the “revolving door” in Washington. Pretending as if the experience these individuals have, i.e. taking money from the same people they are supposed to be regulating, is somehow a positive attribute. That it will, in someway, give them more insight into their job of regulating and hopefully breaking up these monopolies. It seems counterintuitive because it is.
I write this not to make anyone give up hope, only to set realistic expectations. Biden will require reports on each individual industries from these people. The order also requires the full council to meet semi-annually. It is my sincerest hope that they do their job and provide accurate and detailed information to help in breaking up these massive democracy-threatening corporations. If they do and the Biden administration acts swiftly and decisively, I will be the first to shout it from the mountain top. However, we average citizens must watch closely and ensure that they do their jobs. Our livelihoods, and possible the future of our democracy, depends on it.