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The Biden administration is targeting supermarket prices and wants grocery retailers to lower prices on household essentials.
“There are still too many corporations in America ripping off people: price gouging, junk tariffs, greed, counterinflation,” President Joe Biden said earlier this month in the South. Carolina.
The comments, according to the president's advisers, appear to be a push to pressure the Biden administration to try to prevail on supermarket operators and other businesses that maintain higher-than-usual profit margins, according to a report. New York Times report on Friday.
“Our message is very clear that the president has leaned on and will continue to lean on, that is, if you are a company whose input prices have gone down and you are not passing those savings on to the consumer, he will call you,“Jared Bernstein, chairman of Biden's Council of Economic Advisers, said in a virtual meeting with reporters, according to a Reuters account of the event.
Bernstein did not identify any specific company.
A review of census data by the White House revealed that food and beverage retailers' revenues as a proportion of their costs have increased markedly since before the pandemic to a level not reached since the mid-2000s, Reuters reported. Margins have increased about two percentage points since the eve of the pandemic, according to the New York Times.
The Biden administration's obsession with supermarket prices comes as the Federal Trade Commission is trying to make a decision on Kroger's (New York Stock Exchange:KR) planned the purchase of Albertsons for almost $25 billion (New York Stock Exchange:ACI), which some states and politicians say will lead to higher prices for consumers.
“We agree with President Biden,” a Kroger spokesperson told Reuters. “Too many grocery stores in America have increased their margins compared to Kroger.”
The spokesperson added that the merger would “lower prices for even more American consumers by generating at least $500 million in additional price investments at Albertsons stores.”
The merger faces stiff resistance not only from the FTC but also from state attorneys general, members of Congress and even the Teamsters union, which urged the FTC to block the deal amid concerns that joining the two would stifle the competition and would cause job cuts. .
On Wednesday, FTC Commissioner Rebecca Kelly Slaughter said the antitrust regulator is “extremely focused” on blocking bad deals after Amazon (AMZN) ended its planned $1.4 billion acquisition of iRobot (IRBT) on Monday.
Earlier this month, the Washington State Attorney General filed a lawsuit to block the merger of supermarket chains Kroger (KR) and Albertsons (ACI). The lawsuit argued that the $25 billion deal would raise prices and harm consumers.
Kroger (KR) and Albertsons (ACI) received a second request from the FTC in December 2022. Kroger has been working to try to appease the FTC so the antitrust regulator can approve the deal, including a plan announced in September to sell 413 stores for $1.9 billion for C&S Wholesale Grocers.
