Former US Treasury Secretary Larry Summers has found a new target for his war on inflation: President Biden’s antitrust policies.
why does it matter: National gas prices hit another record high on Monday, with inflation reaching 8.3 percent last month. Senior administration officials are highly sensitive to criticisms of Summers, the former Harvard University president who has held senior economic positions in the last two Democratic administrations.
News Leadership: “Policies that attack bigness can easily be inflationary if they prevent economies of scale from being exploited or limit supercompanies,” he tweeted late Sunday night.
- This Twitter thread, which was followed by a Blisters appearing on Bloomberg TV Friday’s interview, bouncing around democratic economic circles, dares officials to reconsider their positions.
- Summers told Axios in an interview on Monday that “while the primary responsibility for inflation lies with the Fed, there are important partial policies as well,” referring to regulatory decisions that can affect rates.
- His “endearing” criticism came in response to a speech on Wednesday by Jonathan Kanter, head of the Justice Department’s antitrust division, who said that “corporate power has grown to levels that make our citizens anxious and confused.” Summers expressed concern that such rulings could lead to dangerous populism.
behind the scenes: Summers remains in touch with Biden’s top aides, who quietly solicit his views — and his comments carry weight throughout the party, even as Republicans have used them to score political points.
- By attacking Biden’s antitrust agenda, appropriating the Federal Trade Commission and the Justice Department’s antitrust division, Summers is opening up an entirely new front on inflation.
The Big Picture: Biden has made antitrust rhetoric the mainstay of his approach to tackling inflation, but Officials admit That they have limited tools to cut prices immediately.
- In Japan on Monday, Biden told reporters he was also considering raising some of Trump’s tariffs on China and that he would discuss the matter with Treasury Secretary Janet Yellen.
- In private management discussions, Treasury economists, including Yellen, argue to raise, Axios reported in April.
recovery: summer february 2021 The Washington Post An inflation warning, exploded in Democratic economic circles, is a lone warning about the $1.9 trillion in coronavirus relief spending that Biden has proposed for the economy.
- Since then Summers has not been be ashamed of repetition His warnings and criticism of both the White House and the Federal Reserve for their slowness to act.
- but he It was always clear Biden’s signature domestic agenda, “Building Back Better,” should help keep costs down. and he recently came to Biden’s defense in his corporate tax feud with Jeff Bezos, calling the Amazon founder “mostly wrong.”
deepen: Last summer, President Biden decided to become Trustbuster head, The signing of an executive order promises to boost competitiveness and subject corporate mergers to the highest scrutiny.
- “Forty years ago, we chose the wrong path,” Biden said, criticizing the antitrust policies of two previous Democratic presidents, including the one he served as vice president.
- Critics, including conservative legal scholar Robert Burke, have been Quick to claim Biden’s “new Brandeisian” antitrust view was unpopular for some reason.
- But Biden’s antitrust enforcers, including FTC Chair Lena Kahn, a prominent Amazon critic, now have Democratic majority On the committee to pursue its progressive agenda on Big Tech.
- Kanter, of the Department of Justice, said he targeted private equity last week Financial Times They strike deals “designed to offload or open up an industry and essentially benefit it”.
the other side: Management insists that sue to block some deals With Lockheed Martin Proposed acquisition of Aerojet Rocketdyne Holdings Inc. It will save taxpayers money by reducing single source contracts.
- A White House official said Axios.
- “That’s why he directed and signed a landmark Competitive Executive Order, which, far from a narrow-minded ‘big bad’ approach, makes a comprehensive government-wide effort to increase competition in ways that improve consumer welfare and economic competitiveness.”