President Biden is not PRIMED to fight high prices he doesn't understand

Norm Singleton writes at Real Clear Markets, “As rising prices and diminishing supplies have replaced COVID as the American people’s number one concern, President Biden has unsurprisingly announced several initiatives aimed at lowering prices and restocking the shelves. Unfortunately, Biden’s proposals will increase prices and decrease supply of goods and services.

For example, Biden has announced plans to spend $1 billion in an attempt to increase competition in the meat processing industry. According to the President, the reason meat prices are high and supplies are low is because of greedy big business.  Not because, wait for it, the government shut down the economy for a year.

Where he is right is that four companies control 85% of the packaged beef market; 70% of the pork market; and 54% of the poultry market. This is definitely enough consolidation to draw attention. However, if one takes the modern approach of applying the consumer welfare standard to one or a few companies allegedly controlling a market, one sees no need for government intervention.

Better yet, Biden’s case for antitrust style intervention gets even worse as you keep looking...

The market effects of higher barriers to entry into a given market – is a more concentrated market. This is what Biden should focus on – handling the poor public policy instead of throwing money at the issue and ignoring the underlying problems.

Thankfully, in the case of meatpacking Kentucky Representative Thomas Massie and Maine Senator Angus King have introduced the PRIME Act (HR 3835/S. 2001), which allows custom slaughterhouses to sell their products directly to consumers in the same state. This legislation increases competition, consumer choice, and in the process provides a market solution."

Read the entire column.