Chairman Nadler Statement for Subcommittee Hearing on "Reviving Competition, Part 4: 21st Century Antitrust Reforms and the American Worker"
Washington, September 28, 2021
Washington, D.C. - Today, House Judiciary Committee Chairman Jerrold Nadler (D-NY) delivered the following opening statement, as prepared, during a Subcommittee on Antitrust, Commercial, and Administrative Law hearing on "Reviving Competition, Part 4: 21st Century Antitrust Reforms and the American Worker:"
"Mr. Chairman, as well all know, America’s economy has become highly concentrated in recent decades. A small number of firms dominate a variety of markets that Americans rely on, including pharmaceuticals, airlines, broadband, online platforms, and meatpacking.
"Just as consolidation in product markets tend to result in higher prices and lower quality in the goods we buy, consolidation has also led to high levels of concentration in labor markets.
"As in any other market, when a lack of competition gives employers excessive power over workers, employers have the incentives and ability to abuse that power. In many industries, these dynamics have led to depressed wages and opportunity, limited worker mobility, misclassification of workers, and discrimination against the most vulnerable.
"Employers with market power can abuse their power over workers in several ways. Some have imposed anticompetitive terms in employment contracts, such as non-compete agreements that ban workers from finding a better job or starting a competing firm. Others collude with rivals to fix wages or prevent workers from changing jobs. With the rise of the gig economy, we see a rising number of employers misclassifying employees as independent contractors.
"These practices harm workers. They exacerbate wealth inequality. They frustrate the ability of workers to earn a living wage and support their families. These practices have no place in a free and fair economy.
"For decades, the antitrust agencies have been too weak or too timid to vigorously enforce the antitrust laws to stop and deter abuses across the economy. But as Professor Eric Posner will testify today, these trends have been worse in labor markets, where enforcement has been virtually non-existent until very recently.
"These failures have undermined economic opportunity and the financial security of American families and small businesses. And in the wake of the pandemic, the impacts of these developments have hit our front-line workers the hardest. Healthcare workers, delivery drivers, grocery workers, meat packers, and other front-line workers have been heroes, keeping us safe, helping American families put food on the table, and keeping our economy going under the most challenging of circumstances.
"Unfortunately, where these workers have saved us during the pandemic, all too often our society has failed them.
"Many of these workers—who, in many industries, are overwhelmingly women or people of color—often work for wages that are too low and in conditions that are unsafe. And in many cases, they are stuck working for corporations that have cornered the market, undermining their ability to find better jobs or higher wages in their field because they simply do not exist.
"For example, as Ms. Payton will testify today, consolidation in the hospital and physician market in Western Pennsylvania has led to lower wages and fewer choices for employment. As she notes, 'There is almost nowhere else to work if you are a healthcare worker.'
"Moreover, as other witnesses will testify today, many of these workers are subject to anticompetitive restraints on their mobility—such as non-compete and no-poach agreements. These abusive contracting practices have become ubiquitous in the workforce, further entrenching the power of employers over workers and preventing the unemployed from getting a new job.
"This must change, and I am encouraged by recent steps by the Biden Administration to address this problem meaningfully through all available tools.
"In July, President Biden issued Executive Order 14036, a sweeping and historic approach to building an economy that works for everyone through the benefits of competition.
"As this Order states, 'Consolidation has increased the power of corporate employers, making it harder for workers to bargain for higher wages and better work conditions.'
"In response to this concern, the President’s Order encourages the antitrust agencies to undertake a series of actions that will protect workers and promote competition in labor markets. These include adopting rules to curtail the use of non-compete and other agreements that unfairly limit worker mobility, as well as policing collusive behavior among employers, such as wage fixing.
"This is a critical effort, and I look forward to updates from the Federal Trade Commission and the Antitrust Division at the Department of Justice on their work to combat market concentration and abuses of market power that harm workers.
"Congressional action is also necessary. There is a pressing need to update the antitrust laws to ensure the antitrust agencies have the necessary tools to stop and deter anticompetitive conduct and mergers that harm workers.
"As I have said before, it will also take a comprehensive set of reforms to recover economic opportunity and dignity for working people. These problems must be addressed with lasting solutions, like guaranteeing equal pay for equal work, prohibiting forced arbitration agreements in employment contracts, establishing a living wage, stopping worker misclassification, and strengthening unions.
"But legislation that will revive competition in labor markets competition is a critical part of this agenda.
"I want to thank all of our witnesses for testifying this morning, and I especially want to thank Ms. Payton and Mr. Gross for appearing today and for sharing their testimony.
"We appreciate that, working in the healthcare and the logistics and delivery industries, you have been on the frontlines during the COVID-19 pandemic. Without you and workers in other frontline professions, our economy—and our society—cannot function. Thank you."I also thank the Chairman for holding today’s hearing on this very important topic, and I yield back the balance of my time."