On Friday, I had an “extra special” MiB guest – I interviewed Brain Deese, Director of the White House National Economic Council under President Joe Biden.
The entire hour interview is now live
podcasts.apple.com/us/podcast/bri…
1/
The entire hour interview is now live
podcasts.apple.com/us/podcast/bri…
1/
What motivated this conversation was an Executive Order issued by Biden.
It was not the usual 1-pager/Photo Op; Rather, it was a serious, 6,832 word, 72-bullet point document.
You may have missed it.
whitehouse.gov/briefing-room/…
2/
It was not the usual 1-pager/Photo Op; Rather, it was a serious, 6,832 word, 72-bullet point document.
You may have missed it.
whitehouse.gov/briefing-room/…
2/
It kind of snuck by unnoticed.
The EO reveals a major policy change: A complete of decades of lax antitrust enforcement, much greater scrutiny of M&A + tougher enforcement against anti-competitive industry consolidation.
I thought it was a big deal.
ritholtz.com/2021/07/presid…
3/
The EO reveals a major policy change: A complete of decades of lax antitrust enforcement, much greater scrutiny of M&A + tougher enforcement against anti-competitive industry consolidation.
I thought it was a big deal.
ritholtz.com/2021/07/presid…
3/
The new policy initiative includes the formation of the President’s Council on Competitiveness. Brain Deese is its Chairman.
He was a MiB guest in February 2020 when he was working as Blackrock's head of ESG Investing
ritholtz.com/2020/02/mib-br…
4/
He was a MiB guest in February 2020 when he was working as Blackrock's head of ESG Investing
ritholtz.com/2020/02/mib-br…
4/
There were lots of takeaways from the conversation, but the biggest was this:
"Industry consolidation and market concentration costs the average U.S. family about $5,000 per year"
bloomberg.com/opinion/articl…
5/
"Industry consolidation and market concentration costs the average U.S. family about $5,000 per year"
bloomberg.com/opinion/articl…
5/
Much of the academic research underlying this can be found here:
Restoring competition in the United States: A vision for antitrust enforcement for the next administration and Congress
s3.documentcloud.org/documents/2098…
6/
Restoring competition in the United States: A vision for antitrust enforcement for the next administration and Congress
s3.documentcloud.org/documents/2098…
6/
M&A has increased significantly over the last 20 years -- with many sectors seeing industry consolidation increasing five-fold.
Deese: “We haven't seen the [promised] attendant benefit in terms of, lower prices, or more innovation in the economy.”
7/
Deese: “We haven't seen the [promised] attendant benefit in terms of, lower prices, or more innovation in the economy.”
7/
30% of jobs in the U.S. require a license today, up from 5% in the 1950s.
Licensing requirements used to be focused on highly skilled and high-risk jobs, such as aircraft pilots and surgeons. Today, some states require licenses to be an interior decorator or a hairdresser.
8/
Licensing requirements used to be focused on highly skilled and high-risk jobs, such as aircraft pilots and surgeons. Today, some states require licenses to be an interior decorator or a hairdresser.
8/
About 1 in 3 employers require a non-compete agreement, covering 60 million employees.
What began as an attempt to protect trade secrets leaving when senior execs changed firms has morphed into a way to suppress wages for rank and file workers.
9/
What began as an attempt to protect trade secrets leaving when senior execs changed firms has morphed into a way to suppress wages for rank and file workers.
9/
We discussed a variety of industries: Farming, Broadband, Pharma, Hospitals, Hearing Aids, wine & alcohol, banking, Real Estate + of course Big Tech.
All engage in some form of anti-competitive behavior that raises prices for consumers or lowers wages for employees
10/
All engage in some form of anti-competitive behavior that raises prices for consumers or lowers wages for employees
10/
Some mind-blowing examples: I had no idea landlords & condos got paid for exclusive cable deals eliminating broadband providers from competing in the same building.
Ending these illegal deals will allow you to choose among competing providers.
You know, like CAPITALISM.
11/
Ending these illegal deals will allow you to choose among competing providers.
You know, like CAPITALISM.
11/
Another grievous offender, our friends at the National Association of Realtors (NAR)
NAR does a variety of things that have contributed to the USA have among the highest RRE commissions in the world. They have been put on notice they MUST change their practices.
12/
NAR does a variety of things that have contributed to the USA have among the highest RRE commissions in the world. They have been put on notice they MUST change their practices.
12/
Example: Post-election loss, the Trump admin signed a sweetheart deal with the National Association of Realtors. It was a simultaneous "suit + proposed settlement"
It was a crony grift, and this admin just killed it.
justice.gov/opa/pr/justice…
13/
It was a crony grift, and this admin just killed it.
justice.gov/opa/pr/justice…
13/
The Realtors trade group are accused of being opaque + limiting access to homes on multiple listings services.
What the Council on Competitiveness wants to do is allow broad competition to drive down transaction costs on home sales; The NAR wants to keep 6% commissions.
14/
What the Council on Competitiveness wants to do is allow broad competition to drive down transaction costs on home sales; The NAR wants to keep 6% commissions.
14/
Other items:
- Restoring Net Neutrality
- Allowing Farmers to repair their own tractors
- Allowing Consumers to repair their phones/tablets
- Hearing aids sold w/o a prescription
- Eliminating regs on wine and alcohol bottles size/shape
Lots more
15/
- Restoring Net Neutrality
- Allowing Farmers to repair their own tractors
- Allowing Consumers to repair their phones/tablets
- Hearing aids sold w/o a prescription
- Eliminating regs on wine and alcohol bottles size/shape
Lots more
15/
There's much more in this hour-long interview - Deese has given this a lot of thought; he believes more competition + less industry concentration will accrue to the benefit of families, clawing back some of that $5000 per year in excess costs.
I hope he succeeds
END
I hope he succeeds
END
Update: Hospital consolidation has increased costs for patients consumers, with no commensurate increase in the quality or scope of services.
npr.org/sections/money…
npr.org/sections/money…
• • •
Missing some Tweet in this thread? You can try to
force a refresh
