Project Syndicate - How Antitrust Can Advance Kamala Harris’s Small-Business Agenda

The US Federal Trade Commission has long treated cooperation among independent businesses as an illegal restraint of trade, and thus no different from collusion among large corporations. If Kamala Harris wins the US presidential election in November, that must change in order to achieve her goal of supporting small firms.

When she announced her plan to create an “opportunity economy” in the United States, Vice President Kamala Harris declared that one of her “singular priorities is to invest and grow our small businesses.” If elected president, Harris should do that by maintaining and expanding the current administration’s antitrust agenda, in addition to the various credit and tax policies she has proposed.

There are many ways that antitrust enforcement, which under President Joe Biden has focused on big business, can improve the economic environment for small firms. For starters, the Federal Trade Commission’s ban on non-compete clauses in employment contracts, if upheld in court, will allow millions of people to leave their current employers and pursue entrepreneurial opportunities. But both the FTC and the US Department of Justice can do more to reshape antitrust policy to ensure that these businesses are independent, not dominated by powerful corporations.

Equally important, antitrust law should no longer be used, as it has been in recent decades, to disempower small businesses. In August, Coopharma, a cooperative of independent pharmacy owners in Puerto Rico, petitioned the FTC to modify or rescind a 2012 order that bans them from engaging in collective bargaining with pharmacy benefit managers and insurers. (The Open Markets Institute, where I work, filed a comment supporting Coopharma’s petition.) By terminating this order, the FTC could create space for other small players to counter the power of large corporations through collective action.

Independent pharmacies play an important role in US communities: they employ many people, they are an attractive entrepreneurial opportunity for health-care professionals, and, in some small towns and rural areas, they are the only places dispensing medicine and vaccines. In 2021, West Virginia administered initial doses of the COVID-19 vaccine more rapidly than other states, in part because it relied on its network of independent pharmacies instead of large chains such as CVS and Walgreens.

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