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Bloomberg reports that the United Food and Commercial Workers (UFCW) and the National Farmers Union have joined forces to try to convince the Obama administration that Walmart is large and pervasive enough that its efforts to cut supply chain costs amounts to an antitrust violation that is unfairly holding down prices in the agriculture industry.

According to the story, “Wal-Mart’s critics said they anticipate, after years of government reluctance to regulate farming, that President Obama will inject more competition into the food-producing business ... Wal-Mart’s detractors argue that the retailer’s power is so great that it can underpay for goods, threatening suppliers.”

Walmart tells Bloomberg that its goal is to work with farmers to keep prices low for consumers, not undercut them.
KC's View:
First of all, Walmart is just one company, and while it is a behemoth, the government hasn’t stopped growth that, best I can tell, has been entirely legal, even is discomfiting to those who have to compete with it. Not sure how the government could step in and force Walmart to rise prices.,..though to be sure, I’m not a lawyer and what I know about antitrust law could be contained in a thimble with plenty of room for lots else.

But let’s look at this story in context. Walmart is being accused of inappropriately keeping prices low in an economy where one of seven Americans is living below the poverty line. It’ll be hard to generate much sympathy for folks who want Walmart to charge higher prices (though the irony is that probably some of the folks doing the complaining may be below the poverty line precisely because Walmart pays less for their products). Is Walmart using its size and power to drive down prices? Sure. And most of its shoppers probably are thankful for the effort.

It’s also hard to accuse Walmart of having too much power when it also is being reported in Dallas that the much smaller Aldi is undercutting it on milk prices.

You have to keep accusations like these in context. Life is rarely as simple as the union workers, farmers and ranchers seem to be suggesting.