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A Crossroads for Biden on Corporate Power

Also, Congress focuses in on the failed arts venue grant program

I woke up this morning, as I do every morning, around 6:00am (a dog who has no ability to tell time is partially responsible) and began to write this chronicle of an early presidency. I’ve been doing this since last March, waking up on deadline, since the early stirrings of the coronavirus crisis. I felt it was important to have a real-time, rolling conversation about the most impactful crisis of our time, something that was going to impact health, economics, and politics, and the way we associate with one another. I felt like a daily report that contextualized and contributed to the story would add value.

With vaccinations rolling and the first 100 days coming to a close, by next week I won’t be doing this crazy schedule anymore. But I’m honored to say that we made a difference. Unsanitized, the precursor to First 100, has been selected for the Hillman Foundation Award for magazine journalism.

I couldn’t have done this without the knowledge that my incredibly capable and talented staff would be able to provide great coverage day after day, allowing me to focus on the crisis, and then the administration. The support from our production staff is first-rate, as is the mentorship and encouragement of our senior leadership and editorial board. Just read the masthead and imagine me thanking all of them.

I’m very pleased that this style of journalism, a true first draft of history, has been recognized. I have interests in other topics and other types of reporting, but this daily report is a throwback to my roots as a blogger, and with the pandemic I don’t think there was a better way to report it out. Thanks to the Hillman Foundation and finally to you, the readers, who have hung in there for this experiment and gotten something out of it. This is your award too.

“The economic royalists complain that we seek to overthrow the institutions of America,” Franklin Roosevelt said in1936. “What they really complain of is that we seek to take away their power.” Challenging corporate power was at the heart of FDR’s project. Joe Biden keeps getting compared to FDR and seems to be pleased with the comparison. But the Biden administration’s record on corporate power is a big incomplete.

The administration has made a couple noteworthy hires, like Lina Khan and Tim Wu. Khan isn’t installed at the Federal Trade Commission yet; her confirmation hearing is this week. And even once she gets seated, Democrats won’t have a majority on the commission once Rohit Chopra shifts to the Consumer Financial Protection Bureau.

In the meantime, what’s happening on that Commission? Acting chair Rebecca Kelly Slaughter announced in March, to much fanfare, an interagency “rethink” of pharmaceutical mergers, after a decade of dealmaking. The expectation was for much more rigorous scrutiny of pharma mergers. But the first one that came up, a $39 billion acquisition of Alexion by AstraZeneca, went through within four months, without a “second request.” That means that the FTC didn’t ask for more time to consider the merger. No conditions were added. It was just waved through.

Another merger, creating a giant in the market for salt, was approved by the Justice Department yesterday with a divestiture. Conditions-based mergers have fared quite badly in recent years. This would have brought us from three evaporated salt manufacturers to two, and instead there will be two big ones and one newfangled rival jury-rigged by DOJ to manufacture competition.

Elsewhere, Treasury Secretary Janet Yellen named her “climate czar” yesterday. The initial assumption was that progressive regulator Sarah Bloom Raskin would get this position; instead it went to John Morton, a green venture capitalist and former private equity baron with no regulatory experience at all. If banks are going to be held to a standard of protecting against climate risk, you need someone who actually knows how to do that, rather than a financier who primarily sees climate risk in terms of moneymaking.

These data points are alarming on their own; together they send a business-as-usual message. And that’s not all: the protection of pharmaceutical IP on COVID vaccines even as mutations rip through the rest of the world, the willingness to bend on corporate taxation. This isn’t universal—an anti-debt collector effort at CFPB looks solid—but there’s a sense that the administration is coasting on good press about fiscal policy while corporations continue to grow in size and power. At a time when the business community is nervous about social dysfunction and shying away from right-wing populism, they seem to be receiving aid and comfort from the opposition party.

Congress is getting antsy. Yesterday, several House members, including two committee chairs, demanded that the antitrust agencies’ investigate Live Nation’s anti-competitive conduct, which has been documented for years. Democrats on the relevant banking committees are asking why there hasn’t been a challenge to a bank merger in 35 years.

The fear is that the administration’s incomplete grade turns to a failing one, and it’s already starting to happen. You cannot solve all the challenges we face as a nation without confronting the forces who profit from the status quo. An accommodation with capital will not be successful. Whether Wall Street, Silicon Valley, and Big Business will have influence in this presidency, contrary to popular belief, remains to be seen. The administration has a choice to make.

There’s been more attention paid to the inability to deliver relief to music club and other venue operators after our story last Thursday. The big boys at the Washington Post and the New York Times got involved; the Times even managed to snag, well, the exact same quote from the exact same person that we ran four days earlier. Good on the Gray Lady.

Meanwhile, the Small Business Administration has promised to reopen the application portal for Shuttered Venue Operators Grants by this Friday, April 23. And Congress will be watching. I’ve obtained a draft letter signed by a whopping 57 Senators (including 20 Republicans) and 116 House members (19 Republicans) urging the SBA to “make every effort” to meet the Friday goal. The letter also asks that guidance be finalized on requirements for eligibility without delay, and to implement a “technical corrections” process so any application errors can be fixed without a denial of the grant. Having that many members, on a bipartisan basis, scrutinizing the SBA is a good sign.

Hopefully all this attention means that the administration makes this a priority, and venue operators who have been running on fumes for over a year can get the funding to which they’re entitled.

Biden might get something else to sign: a modest anti-Asian hate crimes bill. (Politico)
The president has asked for a counter-offer to his infrastructure package by mid-May. (Washington Post)
Considering that Republicans are united against a corporate tax increase, I’m thinking there will be no counter-offer. (Axios)
Meanwhile the second half of the package, the $1.5 trillion American Families Plan, is going to be announced soon. It’s mostly care funding and free community college. (Washington Post)
The overwhelming majority of Americans supports the decision on the Johnson & Johnson vaccine. I really don’t think there was a good option. (Axios)
Interesting that the message is that green energy can counter China. (Financial Times)
Trump appointee overseeing the National Climate Assessment has been removed by the White House. (Yahoo News)