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1. Ok, here's a quick thread on a simple question that seems apolitical but isn't. How easy is should it be to open and run an independent store? Late last month, the Republicans on the FTC gave their answer. They decided independent stores should die.
2. To run an economy with small businesses, you have to have plumbing that allows small businesses to exist. Distributors that sell in smaller amounts, payment systems, credit, etc. New York City has a lot of bodegas bc this infrastructure exists. Most U.S. areas don't.
3. Last month, the Federal Trade Commission decided that Staples, a giant office retailer, could acquire the nation's largest wholesaler of office supplies, Essendant. There are just two big office supply wholesalers. Staples now owns one of them.
4. Now every independent office supply store will have to purchase wholesale office supplies from Staples, their biggest rival, which also just became their biggest supplier. It was a 3-2 vote. And the rationale allowing the merger was both cruel and naive.
5. The three GOP FTC commissioners - Christine Wilson, @FTCPhillips @JoeSimonsFTC - argued, and I'm not kidding, that Staples would have no incentive to drive its competitors out of business. Yes. They argued that. ftc.gov/system/files/d…
6. In this insane and corrupt worldview, the acquisition, rather than concentrating power, is simply making the economy more efficient. Apply this across every sector of the economy, and you'll see why it's increasingly impossible to open or run local businesses.
7. In America, we have chosen not to have public administrative channels to distribute goods. Instead, we use competitive markets. What the law and economics philosophy has done is to turn these markets into private administrative channels. Now Staples controls its competitors.
8. Two Democrats opposed the acquisition. @RKSlaughterFTC, who has voted with the GOP majority in the past, wrote an important dissent. It can be summarized with, 'are you guys kidding?!?' ftc.gov/system/files/d…
9. @RKSlaughterFTC has tried to maintain the historic collegiality of the FTC. But now she's starting to stake out her place in, as she puts it, the “great debate… taking place in policy circles and even around the country at family dinner tables” about corporate power.
10. The FTC breaking 3-2 against a merger challenge is a big deal. It means the law and economics consensus tilting our society towards monopoly has broken down. @RKSlaughterFTC made a number of good points. One is that the FTC should measure what happens after the merger.
11. In an embarrassing and error-filled screed, Republican FTC Commissioner Christine Wilson mocked @RKSlaughterFTC for even seeking to know what happens in the market after the merger. Wilson wants the FTC blinded, so she can argue the FTC can't see any problems.
12. The FTC really needs to be revamped. But there's now a vigorous debate over whether we want small businesses and democracy in America, or just monopolies and concentrated power. And the debate is finally hitting the FTC. Congrats @RKSlaughterFTC and @chopraftc.
13. If the GOP wants to encourage socialism, they will continue to erode competitive markets and concentrate wealth and power into the hands of private monopolists. One reason the younger generation groks socialism is bc they haven't experienced small independent businesses.
14. If we design a property rights system so that property means centralized control by reckless billionaires, people will reject property as a means of organizing their society. This is where the consumer welfare proponents are taking us. It's a dangerous road.
