In the latest development regarding the potential merger between grocery stores Kroger and Albertsons, it was announced last month that a final decision by the Federal Trade Commission (FTC) would not come until January 17. Perhaps this is a good thing as it will give the agency ample time to consider the many benefits that such a merger would provide to consumers such as lower prices and more product options. As the FTC weighs its decision, it should block out any outside noise from politicians determined to see the deal fall through.
Much of this recent noise stems from a handful of ideologically driven lawmakers who continue to recycle disproven claims about the merger. In a letter sent to FTC Chair Lina Khan on December 11, Senators Elizabeth Warren (D-MA), Bernard Sanders (D-VT), and a handful of their colleagues made several common claims about the merger. Those claims need debunking.
First, they argue that the proposed merger will harm “consumers, workers, and the grocery industry as a whole.” To support this claim, they point out that a Kroger-Albertsons merger would allow the two grocery stores to control a much larger share of the grocery market. With this increased market share they argue the conjoined companies will form a duopoly with Walmart, which they will use to raise consumer prices and harm workers.
However, little about this claim is accurate. Because Kroger will sell 400 stores to C&S Wholesale Grocers in overlapping markets and is prepared to sell an additional 237 stores if asked, the merger will not increase market local concentration. Furthermore, while it is true that a merger would allow Kroger to compete with Walmart more effectively, it would not result in a Kroger-Walmart duopoly. Several companies maintain a much larger market share.
Read the full Townhall article here.
Nate Scherer is a policy analyst with the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit us at www.TheAmericanConsumer.Org or follow us on X @ConsumerPal.