Letter on the Family Grocery and Farmer Relief Act and the Break Up Big Medicine Act

Dear Chairman Grassley and Ranking Member Durbin:

The Chamber writes to express deep concerns regarding the use of antitrust legislation as a tool to regulate sectors of the economy under the guise of affordability. Such approaches fundamentally undermine market efficiency, embolden the power of big government, and ultimately harm consumers. By attempting to micromanage market outcomes, these policies lead to higher prices, fewer choices, and stifled economic growth. Antitrust law has long been a cornerstone of promoting competition and consumer welfare, but its misuse as a regulatory mechanism risks eroding these fundamentally sound principles.

The Government Should Not Dictate Market Structures

Two pending bills, the "Family Grocery and Farmer Relief Act" and the "Break Up Big Medicine Act," would dictate the structure of markets in the meatpacking and health care sectors, respectively. Although intended to bolster competition, these and similar proposals ultimately would raise prices for consumers.

For most of the past forty years, a bipartisan consensus has endorsed the use of antitrust law to focus on the welfare of consumers as measured by such objective criteria as price, quality, variety, and innovation. In so doing, both Republicans and Democrats rejected an earlier belief that competition should be measured by market structures, such as the number of competitors in a particular market. Backed by decades of experience and empirical evidence, this bipartisan consensus recognizes that companies often achieve "economies of scale" that benefit consumers in terms of efficiency, prices, and innovation.

On the other hand, when the government uses antitrust law to dictate market structures, consumers usually lose. Most importantly, antitrust enforcement becomes "politicized," with economic decisions based on lobbying and political interests rather than economic factors. This practice tends to discourage investment and innovation and to punish successful companies for outcompeting their rivals. It also leads to arbitrary decisions, as federal agencies, rather than market forces, determine the number of competitors in the marketplace irrespective of consumer preferences or changes in supply or demand.

Unfortunately, both the Family Grocery and Farmer Relief Act and the Break Up Big Medicine Act suffer from these defects.

The Pending Bills Likely Would Harm Consumers

The recently introduced Family Grocery and Farmer Relief Act serves as a prime example of this flawed approach. The legislation blames high beef prices on industry concentration levels that have hardly changed over the last 40 years. Today beef processors are losing significant sums of money due to the record cost of cattle. This cost is driven by the lowest numbers of cattle available for purchase in USDA's recorded history. We do not have an antitrust problem; the problem is cattle herds are at their lowest levels in nearly 75 years.

The legislation would also prohibit a meat packing company from owning and operating across multiple lines of protein. The price of beef has nothing to do with whether a company also processes chicken or pork. In fact, diversification by these companies allows them to weather market fluctuations in commodity cycles. But with a government prohibition on diversification, a beef-only processor would face going out of business given current market conditions if they didn't have other business lines to fall back on.

Similarly, the Break Up Big Medicine Act exemplifies the dangers of overreach in antitrust legislation. This proposal would dismantle integrated healthcare systems and impose structural market mandates under the assumption that size inherently equates to anticompetitive behavior without having to demonstrate harm to competition. Integrated healthcare systems can deliver efficiencies and improve care coordination, and are already subject to antitrust scrutiny. By forcing government-designed disintegration, the legislation would not only increase administrative costs but also jeopardize the quality of care and access for patients, particularly in underserved communities.

In past years, we have also witnessed similar zealous targeting of certain companies in the technology sector. Those proposals attempted to prevent certain companies from engaging in procompetitive conduct that is otherwise widely encouraged. These measures, often based on arbitrary criteria like market capitalization or the number of monthly users, only penalize success and innovation, forcing companies to share sensitive data, limit their ability to develop new products, and even prohibit certain acquisitions. Such actions undermine the very principles of competition and risk ceding technological leadership to foreign competitors.

The Chamber urges the members of the Senate Judiciary Committee to always support competition on the merits and reject legislation that empowers costly, inefficient, and government-engineered outcomes. Antitrust law should remain focused on protecting consumers and fostering innovation, not on picking winners and losers in the marketplace. By preserving the integrity of our antitrust framework, we can ensure a dynamic and competitive economy that benefits all Americans.

Sincerely,

Sean Heather
Senior Vice President
International Regulatory Affairs & Antitrust
U.S. Chamber of Commerce