Elizabeth Warren and AOC Get Everything Wrong About M&A

Elizabeth Warren and AOC Get Everything Wrong About M&A

Arthur Schopenhauer once quipped that if it were constantly repeated with great solemnity, nothing was too absurd for people to believe. After reading the preliminary Pandemic Anti-Monopoly Act from Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez, I find myself more seriously contemplating absurdity. This proposal is a study in Schopenhauer’s point: though couched in great solemnity, both the act itself and the stated rationale for its enactment are, simply, absurd.

The Pandemic Anti-Monopoly Act would “impose a moratorium on risky mergers and acquisitions” for large companies. The objective of such legislation is, in their words, to “stop large corporations from exploiting the pandemic to engage in harmful mergers and to strengthen the federal government’s ability to respond effectively to future crises.” The language of the proposal is visceral, citing “predatory” and “harmful” mergers which lead to “job losses,” “price increases,” and the “exploitation” of small businesses. One might think some dystopian future looms unless we take immediate action! Yet, ironically, it is the cessation of corporate acquisitions and mergers, especially amidst a recession, that makes possible the very dystopia Warren and Ocasio-Cortez wish to avoid.

Read more at Real Clear Markets.

Written by: Franklin Parker, Free Enterprise Analyst for the Lone Star Policy Institute.