Marketplace has a new podcast for kids, "Million Bazillion!" EPISODE OUT NOW

Biden considers order to use regulatory power to boost competition

Meghan McCarty Carino Jun 30, 2021
Heard on:
HTML EMBED:
COPY
The Biden administration might act to strengthen the positions of smaller companies in industries dominated by a small number of giants. Win McNamee/Getty Images

Biden considers order to use regulatory power to boost competition

Meghan McCarty Carino Jun 30, 2021
Heard on:
The Biden administration might act to strengthen the positions of smaller companies in industries dominated by a small number of giants. Win McNamee/Getty Images
HTML EMBED:
COPY

President Joe Biden is considering issuing an executive order that would direct the federal government to tighten the reins on industries dominated by a few large companies. 

The precise wording of the order is not yet known, but the gist of it is that instead of relying on antitrust enforcement, agencies should use regulation to promote competition in industries from agriculture to health care. 

It’s a relatively new approach to preventing big companies from concentrating market power — one first tried by the Barack Obama administration. 

The problems the executive order is aimed at solving arise when just two or three companies dominate a particular business. The government can use antitrust law in those situations, but there are caveats.

“It’s affected by decisions of every department of the government, whether it’s the Department of Transportation or Health and Human Services or the Agriculture Department — all of them can make decisions that lead to more monopolies or fewer monopolies in those areas,” said Jason Furman, an economist at Harvard who chaired the Council of Economic Advisers under Obama. In 2016, just months before Donald Trump was elected president, Furman helped craft an executive order that leveraged the power of all those industry regulators.

“We told every department to go out and find things in their areas that would increase competition,” he said.

The agencies proposed new rules. One would have let consumers access television without a cable box. Another required airlines to be more transparent about baggage fees, and yet another would have protected poultry farmers.

But the Trump administration rolled back many of those rules. Now the Biden administration is looking at reopening the door to new rules in a bunch of industries.

“We have problems in health care. We have problems in food and agriculture. We have problems in telecommunications,” said Diana Moss, president of the American Antitrust Institute. She said that with Biden considering an order early in his term, his administration stands a better chance of unraveling some of the consolidation that’s occurred in those industries. That is, if the government can get new rules past the inevitable lawsuits that might be heard by Trump’s judicial appointees.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.