1. Ok why is Kamala Harris talking about price-fixing, gouging, mergers, and general pricing bullshit? Obviously it polls well. But why? Let's go over the *evidence* for why Americans are mad at big business over pricing. Let's start with rent. propublica.org/article/yields…
2. A company called RealPage works with the biggest corporate landlords to hold apartments empty so they can increase prices. That's illegal. How important is this conspiracy to increased rents? “I think it’s driving it, quite honestly,” said Andrew Bowen, a RealPage executive.
propublica.org/article/yields…
3. There are private antitrust cases against RealPage. The Biden-Harris administration is investigating and will probably bring an antitrust suit soon. The FBI already raided one of America's biggest corporate landlords. finance.yahoo.com/news/fbi-searc…
4. Then there's pervasive price-fixing in the turkey, poultry, and pork industries through the big meatpackers and a data firm called Agri-Stats which tells these companies what to charge. There's even price-fixing clipart! thebignewsletter.com/p/the-price-fi…
5. Agri Stats even puts out a statement on its website saying, in essence, 'we sell cartel pricing.'
6. Collusion on prices seems to be pervasive. The FTC is suing Amazon, for instance, for implementing an algorithm code named "Project Nessie" specifically organized to raise prices across markets. techcrunch.com/2023/11/02/unr…
7. There are many more examples, which I'll get to. But is this phenomenon systemic? Yes. And is it new? Yes. As Mike Konczal and Niko Lusiani showed, corporate markups have increased starting in the early 1980s, and skyrocketed during the pandemic. rooseveltinstitute.org/wp-content/upl…
8. There's even something called 'pricing tech' from McKinsey using data to find ways to hike prices. thebignewsletter.com/p/the-banality…
9. A frozen french fry scheme? As the @Capitol_Forum reported, "the 4 firms who produce 70% of fries nation-wide - Lamb Weston Holdings, Simplot, McCain Foods, and Cavendish Farms - raised prices by virtually identical amounts within a week of each other.”
10. There's price-fixing among plumbing supplies.
11. The problem goes far beyond just price-fixing, of course. For instance there are roll-ups and price hikes via private equity buy-outs in health care. A firm called U.S. Anesthesia Partners raised prices across Texas. thebignewsletter.com/p/cha-ching-li…
12. "85% of Americans “have experienced a hidden or unexpected fee for a service in the previous two years,” and 96% found them “highly annoying” and said they were paying more in hidden charges than they were five years ago."
thebignewsletter.com/p/ending-junk-…
13. Even the former head of the Consumer Bankers Association, one of the most powerful bank lobbies in D.C., got mad about junk fees.
14. 11. Remember when the CEO of Wendy's said the corporation would be using AI to set dynamic prices? That's the kind of bullshit Harris is talking about. Is that gouging? Who cares? We don't have a great word for it.
15. The FTC found evidence of price-fixing in oil markets, as domestic fracking firms worked with OPEC to lower production worldwide. Congress is now investigating. thebignewsletter.com/p/an-oil-price…
16. And I know liberals might feel squeamish about this one, but ammunition prices are skyrocketing because of consolidation. thebignewsletter.com/p/concentrated…
17. Honestly this kind of pricing bullshit is everywhere. Professional bass fishing? Yup.
18. And don't even get me started on pharmaceuticals in health care... thebignewsletter.com/p/inside-the-m…
19. There are monopolies and oligopolies where you don't notice, so-called 'economic termites.' Credit bureaus and FICO, Verisign, industrial gasses, architectural software, locks, entertainment data... thebignewsletter.com/p/economic-ter…
20. Basically, pricing in America today is deeply, immensely, hard-core messed up and unfair. There are tens of thousands of highly intelligent consultants and lawyers who make a lot of money finding out how to cheat you. And Americans have noticed. wsj.com/finance/invest…
21. Hotels, Airbnb, restaurants, landlords, and lenders are all tacking on hidden weird fees. And some of them have middlemen which tack fees onto their businesses. Behind every fee is another fee, middleman on top of middleman.
22. The bottom line is that pricing doesn't just happen, prices are structured by rules. And because we stopped enforcing laws to make sure we had disclosed pricing in competitive markets, pricing is now a game in which more of us lose every day. Harris is talking about THAT.
23. And here we go.
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