|
Welcome to You’re Probably Getting Screwed, a weekly newsletter and video series from J.D. Scholten and Justin Stofferahn about the Second Gilded Age and the ways economic concentration is putting politics and profits over working people.
 |
Welcome to You’re Probably Getting Screwed, a weekly newsletter and video series from J.D. Scholten and Justin Stofferahn about the Second Gilded Age and the ways economic concentration is putting politics and profits over working people.
An economy without competition leads to exploitation. That’s why we should oppose the Union Pacific-Norfolk Southern railroad merger.
In the late 19th century here in the U.S., railroads were one of the first monopolists. Farmers were stuck back then because they were reliant on the railroad to deliver their product to market.
Railroad consolidation used its monopoly power to generate rising rates and discriminatory pricing for farmers who were then hit with collapsing crop prices.
The political backlash of this led to Iowa passing the first antitrust law in the nation which was an “Act for the Punishment of Pools, Trusts, and Conspiracies” in 1888 and then 2 years later the Sherman Antitrust Act at the Federal level.
So what does this merger mean in today’s terms?
2 things… Higher costs and safety issues.
With the lack of competition that means higher shipping costs. Those costs will go to manufacturers, agriculture, small businesses, and ultimately you, the consumer.
With safety, have you noticed the increase of train derailments? As these railroad companies get bigger, they use their influence to loosen regulations.
Tell your elected officials to contact the Surface Transportation Board (STB) to consider the impact before approving Union Pacific’s acquisition of Norfolk Southern.
YOU’RE PROBABLY (ALSO) GETTING SCREWED BY:
Aramark
If you’ve grabbed a beer or a hotdog at a big league game recently, the cashier that rang you up has likely worked for one of two concessions companies, Aramark and Delaware North, which collectively run concessions for 18 MLB teams. For the first time in its 118-year history, the workers at Fenway Park, home of the Boston Red Sox have gone on strike. While the Red Sox do not directly employ these workers (a consequence of our ridiculously fissured workplace) the franchise is worth nearly $5 billion (third highest) and generates nearly $575 million while spending a fraction on player payroll. Plenty of money to go around.
Trump DOJ
A MAGA-fueled purge at the Antitrust Division of the Department of Justice is taking place and threatens to create even more pay-to-play in antitrust enforcement. Matt Stoller at BIG has a deep dive into the crisis.
Rail Mega-Merger
The turmoil at DOJ comes right as Union Pacific Railroad and Norfolk Southern have announced an $85 billion merger that would create the first transcontinental railroad in the US. Think about that, even at the peak of their powers in the first Gilded Age the railroads were not able to amass a combination of this size, but it appears to be fair game in the Second Gilded Age with federal enforcers asleep at the wheel.
Investors
No wonder we have a housing affordability crisis.
 |
RealPage
Speaking of housing affordability, RealPage, the company that has been accused of price-fixing rents, has acquired Livble. The company allows renters to pay their monthly rent in installments, a practice that is growing all across the economy. The acquisition will give RealPage access to a trove of data on people’s individual finances. Can’t imagine how RealPage might use that sensitive data to screw people’s finances even more.
Private Equity
If you feel like the prices at your local vet clinic have skyrocketed, it is quite possible that private equity is to blame.
Trump Executive Order
With Jeffrey Epstein dominating the news out of Washington DC recently, you might have missed news that President Trump is expected to sign an executive order that would allow private equity firms to access your 401k. Fast Company has a long and detailed look at the dangers of this move.
SOME GOOD NEWS
Franchisee Protections
We have covered the struggles facing franchisees who face abusive and anticompetitive conduct from franchisors. A group of House Democrats have now introduced the Franchisee Freedom Act which would grant franchisees the ability to bring private lawsuits under the FTC’s Franchise Rule. Currently only the FTC can enforce the rule.
Democrats & Small Businesses
Former FTC Chair Lina Khan has an excellent opinion piece in the New York Times arguing for Democrats to build coalition with small businesses owners and citing the success of Zohran Mamdani’s mayoral primary campaign as a model. The entirety of the article is paywalled, but below is a snippet.
 |
Massachusetts Antitrust Reform
Legislators are considering an antitrust reform bill that would take steps to protect workers and small businesses. H/t to Daniel Hanley at the Open Markets Institute for highlighting this strong bill, which would include:
 |
BEFORE YOU GO
Before you go, I need two things from you: 1) if you like something, please share it on social media or the next time you have coffee with a friend. 2) Ideas, if you have any ideas for future newsletter content please comment below. Thank you.
Standing Tall for All,
J.D. Scholten
| ||||||||||
