Category: Uncategorized

Heard of the Robinson-Patman Act? If you spend money, you should.

Small retailers have a law to help them compete but is little used.

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Have you noticed a considerable decline in local and regional retail businesses over the years?

Small groceries, pharmacies, hardware, music shops, bookstores have lost out to what we now call “Big Box”.

Some of this can be contributed to changing shopping tastes.  Big Box can offer the stock and breadth of products that smaller retailers cannot.  I admit that I go to Big Box for this reason.  Also, Big Box has a stronger online presence that some retail businesses have either not adapted well to or refuse to. 

Robinson-Patman Act

Local and regional retailers do have the support of the Robinson-Patman Act.  It was enacted in 1936 by Senator Joseph T. Robinson of Arkansas and Representative Wright Patman of Texas.  The Act was designed to restrict price discrimination by large suppliers and protect small retailers from national chain stores.  Suppliers could offer discounts to retailers who bought in bulk, but criteria had to be available to any retailer, without favoritism to individual ones.

The 1980’s saw enforcement begin to wane, as challenges to price discrimination began being seen as anti-competitive.  Businesses were allowed to violate either the law or the spirit of the law and get away with it.

Walmart and Pepsi Collusion

In late 2025 The Institute of Local Self Reliance sued the Federal Trade Commission (FTC) to make public censored details from the case involving PepsiCo and Walmart.  Brought by three Walmart customers, the suit alleged that PepsiCo was informing Walmart what other retailers were paying for the product and conspiring with Walmart’s knowledge to charge them a lower price, in keeping with Walmart’s well-known message of having lower prices.  The Trump Administration subsequently supported the decision by the current FTC to not pursue it any further.

Legislation

On March 19, 2026, Senator Chris Murphy of Connecticut filed in Congress the Fair Prices for Local Businesses Act.  In effect it would strengthen the Robinson-Patman act by eliminating loopholes that currently allow large companies from striking better deals with suppliers than their smaller rivals.  In other words, it would further codify as illegal the arrangement that occurred between Walmart and PepsiCo. 

Conclusion

One thing I advocate is strengthening anti-trust laws to allow for a greater definition of what anti-trust and anti-monopoly behavior is.  This can allow judges have better clarity as to what is in violation and what isn’t.  I support this law.  Equally important, it should go further and eliminate bulk discounts to large retailers.  Testimony from local and regional retailers on this would be welcome, and the media picks up on it as a priority. 

Contact your Senators and ask them to support this legislation.  At the same time ask them to support the Break Up Big Medicine Act, a bi-partisan legislation by Senators Hawley and Warren.  This targets Big Pharma and its acquisitions of health care companies and pharmacies.

 

 

The Core of American Capitalism

Human interaction is an overlooked part of capitalism defined

In the News

I see where Warner Bros. Discovery is giving the Paramount offer a second look at being acquired.  Paramount initiated this acquisition pursuit way back in September, 2025.  It has gotten much media attention, in the national news outlets as well as the business news.

If someone was not a student of economics and relied on the news media for his or her information, you may get the impression that this acquisition, and other big ones that get media attention, are the center of our economic system.  In addition to this acquisition, there is also the constant chatter of how Big Tech is investing umpteen dollars in artificial intelligence.  This sure has had an effect, both positive and negative on the stock market recently. 

Where is this Core?

In my opinion, it started with thousands of men and women throughout the decades who, with some material and financial resources combined with inspiration, went on to create great companies, both large and small,  throughout this country.

I remember reading how both Apple and Microsoft got started in garages.  There is also Walt Disney starting out creating a Mickey Mouse cartoon called “Steamboat Willie.” 

However, since 1980 there have been individuals and companies involved in directions that have shifted much of our economy away from innovation and more about domination.  We have been introduced to such things as investment banks, leveraged buyouts, corporate raiders, hostile takeovers, private equity, private credit, stock buybacks, Pac Man defense, activist investors.  In my opinion they have all immensely deviated from this basic core.

The people involved in these activities are far away, literally and figuratively, from many people found on Main Streets throughout this country.  family and friends may work for local or regional businesses, where upper management has regular face-to-face contact with both employees and customers. 

This personal, human interaction is, in my opinion, where you find the core of our capitalist system.  Laws and tax reform should be in place to help keep businesses independent who want to be independent.  Legislators should give primary attention to small business issues more than corporate campaign contributions. Large corporations are not inherently bad, but the distant relationship between management and employees and customers located hundreds of miles away or across oceans, reduces these people to being mere statistics on paper or a screen.  Decisions can thus be made without the decision makers having any personal interaction with those on the front line.  Decisions based on statistics is important but should also include the personal input from employees and customers.

Final Thoughts

I have written before wondering what is going through the minds of Warner employees with all this acquisition talk.  Customers are also faced with the thought of less entertainment choices and possibly higher costs.  This is high dollar negotiations with huge financial consequences for everyone involved.  Fees and profits are to be earned by some, maybe not all.  Careers may also be on the line.   It is all very important.

It makes for high drama and entertaining news headlines, but has consequences.  Such corporate wheeling and dealing is far removed from what occurs on Main Street America.  Some may call this capitalism, and they may find sources to back that up.  But, in my opinion, this corporate world contributes to the decline in some American’s belief in the capitalist system. 

What do you think?

Budget Deficit:  How Big Tech Can Help

Make Big Tech Help Fund the Three Percent Solution

Andrew Ross Sorkin of the New York Times in a recent DealBook post recently highlighted activity by Ray Dalio.  He reports Mr. Dalio, Chief Investment Officer of Bridgewater Associates, has been making the rounds in Washington talking about the budget deficit.

RAY DALIO

Dalio has been discussing what he calls the “Three Percent Solution.”  Simply put, the goal is to reduce the deficit to Gross Domestic Product (GPR) ratio to 3%.  This can be done by 1) cutting spending, 2) raising tax revenue and 3) lowering interest rates.

Sorkin adds, “A fiscally responsible budget would ease volatility in the bond market. Any economic slowdown caused by reduced spending could be offset by lower interest rates, which is what a heavily indebted nation needs most.”

He follows by saying “All three levers need to work in tandem.”

ANALYSIS

In my opinion, the three percent solution idea makes sense.

Spending by Congress is something I cannot control, nor do I have any quick fix ways to do this.

SOLUTION

There is an idea to raise revenue: place an acquisition tax on the Big Tech firms (Google, Amazon, Microsoft, Apple, Facebook) for every company they have acquired. 

Since they have all have over 80 acquisitions each, why not tax them on it, per acquisition, and make them pay for creating this situation.  Make it an annual tax so they would pay it every year. 

Big Tech seems to be averse to paying fines, both here in the United States and in Europe.  They seem to complain more about being broken up.  Well, if federal efforts at breaking them up do not work, why not at least profit from the status quo?

It would then need to be determined how much per acquisition they would have to pay.  It could also be applied to companies in other industries such as Big Pharma.  It would be based on the number of acquisitions made at the current moment.  It could also apply to future acquisitions.  It could also be graded, such as paying a higher rate the larger number of acquisitions or the price.  The more the merrier.

Such a tax, no matter how widespread, is not a “solution” to the deficit problem.  But it would be additional source of revenue.  Yes it is a tax increase.  However, it is not an income tax increase to the average citizen. 

But what about if Big Tech threatens to raise prices to offset this tax?  Well, to paraphrase President Trump:

“Make them eat it.”

Google Draws the Justice Department on Monopoly Chance Cards

Judge rules with the Justice Department on Google Advertising Practices

On Friday, April 17, 2025 a Judge ruled with the Justice Department on Google advertising practices.

United States District Judge Leonie Brinkema ruled in favor of the Justice Department on charges against Google involving creating a monopoly with publisher ad servers and ad exchange markets.  Judge Brinkema also ruled that Google did not create a monopoly in ad markets. 

An excerpt from her ruling is as follows:

With the benefit of a three-week bench trial and extensive post-trial filings, the Court finds that Plaintiffs have failed to prove that there is a relevant market for open-web display advertiser ad networks, but have proven that Google has violated Section 2 of the Sherman Act by willfully acquiring and maintaining monopoly power in the open-web display publisher ad server market and the open-web display ad exchange market, and has unlawfully tied its publisher ad server (DFP) and ad exchange (AdX) in violation of Sections 1 and 2 of the
Sherman Act.

Google has been previously pursued for having a monopoly with its Chrome browser, primarily by being a default browser in phones, tablets, and computers.  The Justice Department has asked Judge Amit Mehta to divest Chrome from the parent company. 

ANALYSIS

I do not place ads with Google so it is harder for someone like me to determine if there is a true monopoly in this case.

As for Chrome, if competition with other browsers is the goal, this could be worked out without divesting something which they themselves created.

A stealth way Google, as a whole, operates a monopoly is through its acquisitions.  Google purchases companies that they could simply work with as a customer or create a partnership project.  By going the route of purchasing a company they prevent that company working for a rival or working with a third party against Google’s interests.  This is a higher priority over their argument that their company benefits from the acquisition

SOLUTIONS

Judge Brinkema ruled with the Justice Department on Google Advertising Practices on two of three charges.  Now the Judge will decide what action to take against Google.  In my opinion, if the goal is to create more competition, what is needed is for ad customers to have not only choices available but also be consciously aware of the choices and be allowed to select options.

As for the Chrome browser, an alternative to divesting would be to allow device owners to pre-select a browser from a list with brief descriptions of each.  Moving away from having the browser both pre-determined and nearly impossible to replace would be in the best interest of consumers. 

As for the monopoly with its acquisitions, here is a list of companies acquired by Google.  Look at the names, focus on what they do, and determine for yourself whether markets would be better off if these companies were once again independent and free to pursue their own customers. 

Independent doesn’t mean you have to go it alone

There are organizations that can help the independent thrive as independent

There are organizations that can help the independent thrive as independent

Are you an independent business?  Do you want to stay independent?  Does your independence feel threatened by those that are bigger than you?

One is the National Federation of Independent Business (NFIB).  Their motto is as follows:

We are a nonprofit, nonpartisan, member-driven organization that advocates on behalf of America’s small and independent business owners—both in Washington, D.C., and in all 50 state capitals.

They are a business advocate, gathering member opinions nationwide in order to steer policy priorities.  They focus on taxes, healthcare, labor and regulations.

They also focus on competitiveness, working that both government and massive businesses make it impossible for them to compete.  Their website has a video on their anti-trust advocacy.

Another institute is the Center for American Entrepreneurs.  Their motto is as follows:

CAE is a nonpartisan Washington, DC-based research, policy, and advocacy organization that works with policymakers at the federal, state, and local levels across the country to build a policy environment that promotes new business formation, survival, and growth. We pursue this objective through a wide range of activities

They work in advocacy through an Advisory Council and provide issue analysis through a Research Council.  They also have a Board of Directors made up of entrepreneurs, startup investors and startup mentors.

There is also the U.S. Small Business Administration.  Their historical role has been to approve small business loans.  However, they are also involved with small business disaster relief.  In addition, their website provides links to various issues with starting a business, including how to win federal contracts. 

In  December, 2016,  Forbes magazine published the article, “43 Reasons You Should Support Small And Independent Businesses.”  They are primarily quotes from small business owners themselves.  If you identify with one or more of these, you may want to start a campaign to promote them to the general public.  In addition, they offer an Entrepreneurs and Small Business newsletter you can sign up for.