Democratic lawmakers see a bigger problem at hand amid the worrying shortage of baby formula across the country: the increasing consolidation of corporate power through mergers and acquisitions that has led to rising income inequality.
“The shortage was caused in large part by corporate greed and consolidation. There are only four manufacturers of infant formula in the United States,” Rep. Rosa DeLauro (D-Conn.) noted on Tuesday.
DeLauro introduced legislation this week that would boost funding for the Food and Drug Administration as part of an effort aimed to bring more firms into the heavily regulated baby formula market.
Abbott, Reckitt Benckiser, Nestle, and Perrigo account for nearly all infant formula sales in the U.S. Abbott halted production and recalled several brands of formula earlier this year, leading to widespread shortages and panic among distraught parents across the country. The crisis has been felt most acutely by low-income parents who rely on programs such as the Special Supplemental Nutrition Program for Women, Infants, and Children, known as WIC.
Along with calling for probes of Abbott and even suggesting the company be held criminally liable for unsanitary conditions that led to one of its factories being shut down, Democrats, in particular, are homing in on the harmful economic effects of monopolies in America.
Last week, eight Senate Democrats wrote to Agriculture Secretary Tom Vilsack and urged him to do more to address consolidation within the infant formula industry. On Wednesday, two more Democrats fired off a letter to Abbott’s CEO that underscored the point and sought more information about the company’s stock buybacks and executive compensation in recent years.
“This corporate concentration, combined with decades of inactivity by regulators, allowed your company to skate by with subpar safety protocols, knowing that consumers did not have the option to easily switch to a competitor,” Sens. Elizabeth Warren (Mass.) and Cory Booker (N.J.) concluded in the letter.
Four cases of a dangerous bacterial infection in infants were linked to formula produced by a plant owned by Abbott. Two of the cases were fatal; the company has said there’s “no evidence” its product is to blame even though the FDA found unsanitary conditions at the plant.
Few, if any, of these calls by lawmakers will result in an immediate solution to the crisis. Legislation being advanced this week also wouldn’t have an immediate impact on store shelves, even if it quickly became law. But Democrats are planning to keep the issue front and center ahead of midterm elections, pledging to bring formula maker executives to Capitol Hill for hearings this month.
On Monday, Abbott said it reached an agreement with regulators to restart production at its largest domestic factory, though it will still be well over a month before any new products ship from the site to help alleviate the national shortage.
Arthur Delaney contributed reporting.