A group of lawmakers think so.
If your grocery bill keeps going up, you’re definitely not alone. Since the onset of the pandemic in 2020, food prices have skyrocketed by 25 percent, according to data from the Bureau of Labor Statistics. Now, a group of lawmakers are calling on President Biden to use executive authority to bypass Congress and do something about these rising costs.
Massachusetts Sen. Elizabeth Warren and Rep. Jim McGovern sent a letter to Biden (which was signed by 37 other Democratic lawmakers) saying that corporations are making record profits even as families struggle with high food prices. “The federal government should use every possible tool to lower food prices,” they wrote. “We believe you can exercise your executive authority to take additional action to address rising food prices without congressional action.”
But can Biden really use his power to cut down these supermarket expenses? Here’s why essential items are getting so pricey and what steps lawmakers believe Biden could take to help families.
Why are grocery prices so high?
In their letter, lawmakers warned that inflation, which hovers around 3.4 percent, is only part of the problem causing costly groceries. The real culprit? “Excessive price gouging.”
A study from the nonprofit Groundwork Collaborative found that corporate profits account for more than 50 percent of inflation these days, as many Americans struggle to put food on the table. Not only that, but four retailers — Walmart, Kroger, Costco, and Albertsons — account for over a third of national grocery sales, potentially allowing them to get more favorable prices and terms from suppliers.
“A small group of players dominate those industries: Four grocery retailers account for over a third of national grocery sales, and four food companies control more than 60 percent of sales in most grocery categories,” McGovern wrote in a press release about the letter. “As a result, consumers are spending more of their income on food than they have in the past 30 years.”
But financial analyst Mark Hamrick believes these issues run deeper and can be traced back to the supply chain disruptions that we saw during the pandemic. “We don’t tend to buy products that are local — most of our food is imported, so we’re talking about transportation costs and intermediaries in the distribution chain,” he tells us. And according to a report from the Federal Trade Commission in March, major grocery chains appeared to take advantage of supply chain disruptions during this period to hike up prices to increase their profits.
As a result, Americans are increasingly looking for ways to save at the store. For instance, discount grocer Aldi reported a 26 percent jump in foot traffic in March compared to last year.
“Americans are extremely price sensitive, so what we see is a high degree of substitution,” says Hamrick, who’s the Washington Bureau Chief for the financial services company Bankrate. “For instance, store brands are increasingly favored over name brand products.”
Low-income families have been hit especially hard by these rising grocery prices: They spend 31 percent of their income on food, compared to 8 percent for wealthier households. As a result, hunger is on the rise, with food banks around the country seeing significant increases in demand in the past year.
Texas, in particular, has been significantly affected — Central Texas Food Bank CEO and President Sari Vatske tells us that some parts of the Lone Star Star have an average food insecurity rate of 16.4 percent, compared to the national average’s 12.8 percent. “Current demand is as high as it was during the peak pandemic months and shows no signs of slowing,” she says.
What are lawmakers asking Biden to do, exactly?
Even though Donald Trump’s policies would increase grocery prices by placing new tariffs on trillions of dollars of imports, the issue remains a key problem for Biden’s reelection ambitions.
“People are really confused why food prices are going up and down — what really stands out to people is the erraticism,” Democratic pollster Celinda Lake told The Washington Post. “Every day, people are saying: I used to leave the grocery store with three bags. And now it’s two for the same amount of money.”
Biden has taken some steps to address rising food costs, including increasing monthly food stamps from $121 to $157 per person, marking the largest-ever permanent increase in these benefits — and more than 42 million Americans will receive the additional aid. His administration has also already partnered with more than 30 state attorneys general to address anticompetitive behavior and price gouging in food and agricultural markets, as well as finalizing a rule to make meat and poultry markets more competitive for farmers and ranchers.
Still, some believe Biden could do more: The lawmakers who wrote to the president outlined seven courses of action advocating for more collaboration between regulatory agencies. For instance, they said the president could direct the Commodity Futures Trading Commission and the Federal Trade Commission to “work together to ban exclusionary contracting by dominant firms in the food industry.” (The FTC has taken such an initiative — in February, the agency sued to block a merger between two large grocery-store chains, Kroger and Albertsons.)
They urged Biden to direct the Department of Justice and FTC to scrutinize and potentially block mergers and acquisitions in the food and agricultural sectors to prevent further food industry consolidation. The lawmakers say the president could also encourage the Department of Justice to prosecute those who engage in price fixing and anticompetitive behavior that drives up costs.
“These proposals are just examples of the additional actions your Administration can take to help families at the grocery store,” Warren and McGovern said in their letter. “The American people are relying on your Administration to combat corporate greed and higher food prices.”
Though the DOJ has blocked mergers in the food industry like one that would’ve raised prices for lettuce and packaged salads, a White House spokesperson told TIME that the White House doesn’t play a role in or comment on enforcement actions.
While the letter’s signatories are hopeful this will ramp up pressure on some of the food industry’s practices, Hamrick believes it’s largely performative. “Figuring out a way to address these high food prices is a lot more complicated than a swipe of a pen in Washington, D.C., where passing legislation doesn’t seem to be a viable alternative.”
