Friday, July 9, 2021

Biden Targets Big Business In EO To Spur Competition

President Biden signed a broad Executive Order that aims to Promote Competitive Markets across the U.S. Economy and Limit Corporate Dominance that the White House says puts Consumers, Workers, and Smaller Companies at a Disadvantage.

The Order, the Centerpiece of a New Democratic emphasis on Restraining the Nation’s most Powerful Companies, lays out a Detailed Plan to Address what the Biden Administration sees, as Trouble Spots across Industries, from the mundane, Hearing Aids and Baggage Fees, to some of the most Cutting-Edge Issues facing the Government, such as First-ever Antitrust Regulations for Internet Platforms.

Biden’s effort isn’t a Hard Mandate, but instead a Policy Road Map that encourages U.S. Agencies to Adopt Policies that push back against, Corporate Consolidation and Business Practices that might Stifle Competition, and lead to Higher Prices and Fewer Product choices.

The eventual Rules and Regulations that follow from the White House’s Direction are likely to Set-Up Heated Battles with Top U.S. Companies, that could take years to Resolve.

Among the White House’s Targets are: Agriculture, Healthcare, Shipping, Transportation, Technology, and Labor Practices that the Administration says Limit Wages and Mobility.

The Executive Order also seeks to Promote Affordable Broadband and Boost Consumers’ Rights to Repair Products they Own, an Issue of Concern to the Administration because of Limitations imposed by an array of Companies.

The Executive Oorder “will lower prices for families, increase wages for workers, and promote innovation and even faster economic growth,” the White House, said Friday.

Biden’s move, months in the making, comes as Democrats have made Competition Policy and Antitrust Enforcement a Key part of their Agenda, arguing that the Federal Government hasn’t done Enough to Preserve Healthy, Competitive Markets.

Republicans have Agreed in some Circumstances, particularly in the Tech Sector, but they along with Business Groups have Disputed Arguments that the U.S. has Extensive Problems with Economic Concentration. They contend the Biden Administration is starting from a Faulty Premise and Risks making the U.S. Economy less Productive as a Result.

The Executive Order targeting the Technology Industry Jeopardizes “free services that consumers use to message and call loved ones, get directions, connect with healthcare professionals, consume online content—including news and educational content—and much more,” said TechNet, a Group that Represents Senior Industry Executives.

Biden’s Order by itself doesn’t Impose New Requirements on the Business Community. The success of the White House effort could depend on how Hard, and how Quickly, Government Agencies push to Implement his Competition Policies, which are likely to face Court Challenges.

The Biden Administration Initiative follows a similar effort by the Obama White House during its last year. That effort resulted in a Handful of New Rules before the Clock ran out on the Obama era, and as the Trump Administration Reversed many of the Measures.

The New Order places a Diverse set of Initiatives under One roof and is more Explicit in Pushing Government Agencies to take Detailed Steps to Protect Competition. It also comes at the Beginning of a Presidential Term, giving Biden’s Appointees across the Executive Branch more time to Align their Priorities and Implement Regulations.

A Key Architect of the Order was Tim Wu, Special Assistant to the President for Technology and Competition Policy in the White House National Economic Council. An Academic before joining the White House in March, Wu wrote Books and Papers arguing that Large American Corporations hold too much Market Power and that numerous Federal Agencies could Deploy their Authority to help Boost Competition. The White House should Create a New Competition Council to “pressure agencies to open up closed markets while discouraging agencies from entrenching the industries that they regulate,” he said in a 2020 Paper he Co-wrote with other former Obama Administration Officials. Friday’s Order creates such a Council.

Work began on theOorder in earnest after Wu arrived at the White House in March. Wu and other Staff reached out to Regulatory Agencies to Solicit Ideas about what to include in the Order, and suggested some of their own, the Official said.

The Strategy was to Draft an Order reaching across Industries early in the Administration, allowing it to “get the ball rolling on each of these initiatives as quickly as possible,” the Official said.

The Executive Order also touches on Issues Biden has Highlighted for years and on the Campaign Trail, including the use of Noncompete Clauses to Limit Workers’ Mobility.

Several pieces of the Executive Order could provide a Springboard for Plans already being Formulated at some Government Agencies, especially the Federal Trade Commission (FTC), which Shares Antitrust Authority with the Justice Department (DOJ).

The Order encourages the FTC to write first-ever Rules Barring certain Types of Allegedly Anticompetitive Practices including “unfair methods of competition on internet marketplaces,” according to the White House. Biden’s New Head of the FTC, Lina Khan, has previously Voiced support for such Efforts. They are likely to Spark a Partisan Battle on the Five-Member Commission. The Executive Order also Encourages the FTC to Regulate large Technology Platforms by Establishing “rules on surveillance and the accumulation of data.”

Big tech Companies, which are also Facing efforts in Congress to Rein them in, have Vigorously Disputed Allegations that their Size and Conduct are Anti-Consumer and Anticompetitive, saying they have provided highly Popular Products and Services and No or Low Costs.

Outside of the Tech Space, the Order asks the FTC to Ban or Limit Noncompete Agreements and Unnecessary Occupational Licensing Restrictions, and to Limit Employers’ Ability to share Wage and Benefits Data. The White House also wants the Commission to Limit Manufacturers’ ability to Restrict Consumers from using Independent Repair Shops or Do-it-Yourself (DIY) Solutions for Fixing Products ranging from Cellphones to Tractors.

On Agriculture, the Executive Order elevates concerns from Smaller Farmers and Distributors who have said they feel Beholden to Dominant Agribusiness concerns. Biden directed the Agriculture Department (DOA) to consider New Rules that would make it Easier for Farmers to Win certain types of Claims under a Federal Law designed to Preserve Fair Competition and Trade Practices in the Industry.

The Order also calls for NewIinitiatives on Meat Labeling and Protecting Chicken Farmers from Alleged Exploitation.

For the Transportation Industry, the President is calling on the Transportation Department (DOT) to Issue New Rules that Require Airlines to better Disclose certain Fees and to Provide Refunds when Baggage is Delayed or certain Services aren’t provided. The White House’s Requests for the Department, however, are less Ambitious than in other areas of the Executive Order and come as the Department has faced Criticism for Not doing more to Battle airline Consolidation.

The President is encouraging the Federal Maritime Commission (FMC) that Regulates Shipping and the Surface Transportation Board (STB) that Regulates Railroads to Combat what the Biden Administration sees as a Pattern of Consolidation and Aggressive Pricing that has made it Expensive for American Companies to Transport Goods to Market.

The Association of American Railroads (AAR) has Denounced Biden’s Initiative, with Chief Executive, Ian Jefferies, saying a Proposal that would Allow Shippers served by a Single Railroad to Request Bids from Competing Railroads would Undermine the “market-driven principle that keeps the industry viable.”

In the Healthcare Sector, the Order encourages the FTC to Ban “pay for delay” Deals between Competing Drug Manufacturers that can Slow the Release of Generic Drugs. It calls on the Department of Health and Human Services (HHS) to Combat High Prescription Drug Prices and support Lower-Cost Generic Drugs. It also Directs HHS to consider Issuing Rules that would allow the Sale of Hearing Aids over the Counter. This one I Disagree with.

The Order also Targets Internet-Service Providers (ISP). It encourages the Federal Communications Commission (FCC) to Regulate Pricing Disclosures, Contract Termination Fees, and Deals between Providers and Landlords, which the White House says Limit Broadband Options for Tenants.

In Banking, the Consumer Financial Protection Bureau (CFPB) is encouraged to Issue New Rules allowing Customers to Download their Banking Data from One Bank and take it to Another.

NYC Wins When Everyone Can Vote! Michael H. Drucker

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