Our food economies are dominated by a handful of corporations whose stated purpose is to generate profits for their shareholders — no matter the social, human and environmental cost. How did corporations such as Tyson, Aramark, Amazon or Monsanto amass enough power that a single boardroom decision they make can send ripples across the lives and livelihoods of working people and rural communities? What are the systems that enable them to continue growing this power, and who is responsible for ensuring that it doesn’t happen?
Though global organizations, government agencies, industry watchdogs and community groups strive to hold powerful corporations accountable for their actions, the job of making sure a single corporation does not gain disproportionate control of the marketplace and our economy falls to the Federal Trade Commission, an independent agency of the U.S. government that was formed to protect consumers and promote market competition. But the FTC is failing us.
A recent investigation by The Guardian revealed the sheer scale of this consolidation in the food industry: almost 80% of dozens of grocery items that you would buy in an American grocery store can be traced to a few powerful transnational companies that dominate every link of the food supply chain: from seeds and fertilizers to slaughterhouses and supermarkets to cereals and beers. The investigation also laid bare the high cost of letting a handful of greedy corporations control resources that should be going towards nourishing communities and nurturing our ecology — a cost that is passed on to working people, communities and to the environment. This imbalance of power is the result of a wave of unchecked mergers and acquisitions that enabled big corporations to get bigger and expand their influence across our economy and political systems and get away with business practices that are harmful to working people, communities and the environment.
For instance, several of the anti-monopoly lawsuits that burdened the growing food retail industry in the 1970s were focused not only on the consolidation aspects of antitrust, but also in the advertisement, packaging, and shelf space management facets of food retail. One of the most notable of these cases were the Cereal Cases, aimed at the marketing strategies of the ready to eat cereal industry, which at the time was composed of just six firms. The largest four were Kellogg, General Mills, General Food, and Quaker Oats, and over 90% of all ready to eat cereal cases sales were accounted for by these four firms. The cases brought against these firms involved claims that these companies marketed to a vulnerable child audience, and the companies would artificially differentiate between essentially identical cereals, playing up differences in shape and color in order to create the illusion of variety in the market.
However, these cases were eventually dropped due largely to corporate lobbying and political influence, and the big four companies(Kellogg, General Mills, General Food, and Quaker Oats) continued to be allowed to command the market — and still do. It’s evident that more actions are needed to handle economic giants like Amazon, Walmart, Tyson, JBS and Bayer— all of which spend millions of dollars opposing antitrust measures.
A web of influence that shields corporations from accountability
The roots of corporate power over our political and legal systems can be traced to two interconnected things: weak regulation and political lobbying. For decades, corporations have lined the pockets of politicians and influenced policymakers in order to write the rules in their favor and weave a web of influence and power that shield corporations from accountability, even, and especially from agencies like the Federal Trade Commission. Companies like Walmart, Tyson and Amazon have undertaken numerous measures and millions of dollars, to alter its public image and maintain a positive relationship with lawmakers and agencies in Washington, D.C.
This web of influence was on full display in the early days of the COVID19 pandemic.
Much of the reason the FTC hasn’t taken strong enforcement action against corporate monopolies is because of this web of influence and power that those very same corporations have over the agency. Public Citizen found that just over 75 percent of top FTC officials (31 out of 41) over the past two decades have either left the agency to serve corporate interests confronting FTC issues, joined the agency after serving corporate interests on these issues, or both (Citizen, 2019.)
A window of opportunity
So far, the Biden Administration has demonstrated a stance on corporate consolidation that could be more aggressive than any President in recent terms and allow the FTC to use its power to protect consumers from corporate dominance. In early July, Biden issued an executive order for federal action that brings competition into the marketplace. In the executive order, Biden points out that concentrated market power in the agriculture industry has made it hard for small farmers to survive and for workers to have autonomy.
The FTC also has new leadership. Lina Khan, who has historically taken seriously the impact of corporate monopoly power and its harm, has been appointed Commissioner of the FTC, and two additional commissioners (Rohit Chopra and Rebecca Slaughter) have taken strong stances in favor of protecting the public from corporate abuse through FTC enforcement action. The combination of Biden’s open stance towards a more competitive marketplace, and an FTC that is actively willing to use its enforcement power has created a historical opportunity for addressing, and creating fair and competitive marketplaces.
The time to act is now
The FTC is currently well-positioned to take on corporate monopolies in favor of the public interest. This presents a window of opportunity for advocates for fair and competitive practices. We must come together to pressure the agency to act in favor of our communities and towards a future where market access is available to more than a few giant corporations. Now is the time! Together we can pressure the FTC to use its power and break up corporate monopolies in food and agriculture