FOR IMMEDIATE RELEASE: January 9, 2023

CONTACT: Ashley Woolheater, woolheater@openmarketsinstitute.org

“Today the role of monopsony in driving up prices and deepening inequities across the board gives the broader public a building case for insisting that Robinson-Patman be enforced.”

WASHINGTON- In his latest piece in The Washington Monthly, “Everyday High Prices: How discounting led to inflation, shortages, and inequality,” Open Markets Institute Policy Director Phillip Longman explains why political demand is growing for renewed enforcement of the Robinson-Patman Act.

In March 2022, 43 members of Congress, more than half of them Republicans, wrote to FTC Chair Lina Khan urging her and the other FTC commissioners to use Robinson-Patman to investigate the anticompetitive effects of price discrimination that “ripple through the entire supply chain—harming consumers as well as independent producers” and may violate Robinson-Patman laws.

Khan followed their letter by announcing in June that the FTC is looking at the use of Robinson-Patman to prosecute pharmacy benefit managers for illegal bribes and rebates. A few months later, speaking at an Open Markets Institute and Institute for Local Self-Reliance (ILSR) event in Minneapolis, newly-confirmed FTC Commissioner Alvaro Bedoya used one of his first speaking opportunities to call for a “return to fairness,” and cited Robinson-Patman enforcement as a key solution for doing so.

“Congress never dared to repeal Robinson-Patman,” Longman writes in his piece in The Monthly, but enforcement "effectively stopped after Ronald Reagan became president, with long-term results that should have been predictable. When combined with lax enforcement of other antitrust and competition policies, the retreat from Robinson-Patman gradually restructured industry after industry in ways that are today driving up prices, suppressing wages, and contributing to the undersupply and maldistribution of more and more essential goods and services—from baby formula and affordable healthy food to prescription drugs and hospital beds.”

"[T]oday the role of monopsony in driving up prices and deepening inequities across the board gives the broader public a building case for insisting that Robinson-Patman be enforced. It may be that the act should be amended to make it clearer what companies and practices it covers and how it applies to today’s giant e-commerce platforms like Amazon. But as it is, enforcing the law provides a ready vehicle, requiring little no appropriation from Congress or use of tax dollars, for rebuilding the fairer and more competitive economy demanded by Americans across the political spectrum. It’s high time we used it.”

Read in the Washington Monthly here.

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The Open Markets Institute is a team of journalists, researchers, lawyers, economists, and advocates working together to expose and reverse the stranglehold that corporate monopolies have on our country.  Learn more at www.openmarketsinstitute.org.