Monopolies are killing the American Dream. We must keep them in check
Monopolies are an important issue in the 2020 presidential campaign and even took the center stage at the first of last week's Democratic debates, with Elizabeth Warren pronouncing early on that she wanted to return government to the people.
This was a break from past presidential debates, to say the least. Author and editor David Dayen tweeted, "Literally more monopoly discussion in the first 5 minutes of this debate than the past 50 years of presidential politics."
People tend to think of Big Tech as the antitrust issue of the day, but tech giants are only the tip of the iceberg of the monopoly problems plaguing America. Most of the major challenges the candidates discussed — including unaffordable health care, income inequality and stagnant wages — can't be solved without checking monopolies' economic and political power.
Take health care. The Open Markets Institute, where I work, recently published Volume II of America's Concentration Crisis, presenting troubling data on health care market concentration. In one example, two corporations, Fresenius Medical Care and DaVita, control a 92% market share in dialysis centers, a $24.4 billion industry. This concentration is a major reason health care costs have been skyrocketing for Americans. When health care providers lack competition, they can name their price and patients ultimately foot the bill. Even people with insurance through their employers pay higher premiums and out-of-pocket costs.
Yet health care is still only the beginning. The concentration crisis extends throughout our economy to include markets like baby formula, where three companies control 80% of the market, washer and dryer manufacturing, where three companies control 100% of the market, and airlines, where four companies control 76% of the market overall, with even higher concentrations on individual routes.
As monopolies and oligopolies rule most sectors of the economy, they are extracting wealth from everyone else. Chicken monopolies are extracting wealth from chicken farmers. Hospital mergers are depressing nurse's wages. Small and big businesses, workers and creators are being squeezed by monopolists who use their market power to extract the fruits of everyone else's labor. It's no surprise we are experiencing economic inequality that amounts to a New Gilded Age, with the richest 0.1% of all American families owning as much wealth as the lower 90% of all American families combined.
Monopolies are destroying the American Dream.