WASHINGTON — President Biden signed a sweeping executive order Friday aimed at spurring competition across the economy, encouraging federal agencies to take a wide range of actions, including more closely scrutinizing the tech industry, cracking down on high fees charged by sea shippers, and allowing hearing aids to be sold over the counter.
“What we’ve seen over the past few decades is less competition and more concentration that holds our economy back,” Biden said in the White House on Friday, shortly before signing the order, citing the agriculture, tech, and pharmaceutical industries. “Rather than competing for consumers, they are consuming their competitors. Rather than competing for workers, they’re finding ways to gain the upper hand on labor.”
The order reflects the administration’s growing embrace of warnings by some economists that declining competition is hobbling the economy’s vitality, raising prices and reducing choices for consumers in key areas, while dampening pay and restricting freedom to change jobs for workers. Progressive groups celebrated it, while some business groups criticized it harshly.
But Biden may find challenges in addressing that competition decline across diverse sectors of the economy — including Silicon Valley, Wall Street, chain restaurants, and large hospital networks — solely through executive action. Experts warn that in many areas, the president will need to work with Congress to change federal laws if he hopes to have more success than former president Donald Trump, who also issued competition-focused executive orders and saw limited results from them.
In interviews this week, senior administration officials acknowledged the limitations of executive authority but said the order chose actions, like directing federal regulators to take steps to boost competition in several areas, that had the best chance of success in driving change across the economy.
The White House Council of Economic Advisers noted several examples of such industries in an accompanying research brief Friday, including beef packing and airlines, which are each dominated by four large companies.
It will create a White House Competition Council, led by Brian Deese, director of the National Economic Council, which will “coordinate the federal government’s response to the rising power of large corporations in the economy,” administration officials said in a news release.
The order is a victory for the progressive lawmakers and academics who say government regulators failed to check the growth of corporate America for decades, instead aligning themselves with a conservative view that set a high standard for when the government should block mergers or break up monopolies. They have also criticized the Obama administration for failing to properly police industry consolidation, particularly in Silicon Valley.
They say that policymakers need to aggressively enforce antitrust laws and possibly rewrite them entirely. Without drastic action, they argue, consumers will have less choice, suppliers of bigger companies will get squeezed, and giant corporations will only grow larger.
A leading business lobbying group in Washington, the US Chamber of Commerce, panned the order. Neil Bradley, the group’s executive vice president and chief policy officer, said the order was “built on the flawed belief that our economy is overconcentrated, stagnant, and fails to generate private investment needed to spur innovation. Such broadsided claims are out of touch with reality, as our economy has proven to be resilient and remains the envy of the world.”
Biden has already put some vocal critics of corporate power in leadership positions. In the White House, he appointed Tim Wu, a Columbia University law professor and outspoken proponent of breaking up companies like Facebook, as a special adviser on competition. He named Lina Khan as chair of the Federal Trade Commission. Khan worked on a House antitrust investigation into Amazon, Apple, Facebook, and Google and earlier in her career wrote critically about concentration in other industries, like candy manufacturing and agriculture.
But Biden has also not yet nominated someone to lead the Department of Justice’s antitrust division, a key position in determining the administration’s position on competition issues.
One of the targets of the executive order is mergers where big tech companies buy small companies that could become fierce competitors, snuffing out a rival before it gets off the ground. The directives encourage the agencies to revisit the guidelines they use to assess proposed deals, including when a company is buying a young competitor or a major cache of data that could help it dominate.
The order will also ask the Federal Communications Commission to adopt new restrictions on the practices of broadband internet providers like Comcast, AT&T, and Verizon. Activists have long said consumers have too few choices, and pay too much money, for internet service.