These deals are being made in nearly every sector, regardless of geography. Last week, Englewood, Colo.-based Catholic Health Initiatives and San Francisco-based Dignity Health struck a multibillion-dollar deal to combine into a single system of 139 hospitals spanning 28 states.
But, lawmakers aren’t just taking issue with the agreements themselves: they’re attacking the government regulations that enable them. Sen. Elizabeth Warren, D-Mass., and other Democrats argue the Chicago school of economics — the principles that influence how government regulators evaluate mergers — allow and, in some cases, encourage large mergers, which they say threatens competition and hurts the public.
“With the growth of Chicago school economics in the 1970s and 1980s … instead of blocking mergers that posed significant threats to competition, [antitrust enforcers] signed off on settlement agreements that allowed bad mergers if the companies promised to take actions later on that were supposedly designed to protect competition,” Ms. Warren said, according to The Hill.
In November, Democratic leaders proposed the “Better Deal” plan, an economic policy reform pushed out by Sen. Chuck Schumer, N.Y., and Rep. Nancy Pelosi, Calif., that advocates antitrust policies.
“We propose establishing new merger standards that require a broader, longer-term view and strong presumptions that market concentration can result in anticompetitive conduct,” they wrote, according to The Hill.
Republicans are critical of the plan. Sen. Orrin Hatch, R-Utah, referred to it as “hipster antitrust,” meaning the proposal tried to preemptively mitigate risks from mergers before they actually harm the market.
“From what I can tell, it amounts to little more than pseudo-economic demagoguery and anti-corporate paranoia,” Mr. Hatch said during an August Senate floor speech, according to The Hill.
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