On Monday, a judge at the U.S. District Court of Oregon in Portland will hear arguments to temporarily block the proposed merger of Kroger and Albertsons grocery chains. The nearly $25 billion deal, which was announced nearly two years ago, would create the largest supermarket chain in U.S. history, with roughly 5,000 stores and 700,000 employees across 48 states. Kroger owns Fred Meyer and QFC, which are familiar to shoppers in the Northwest.
In February, the Federal Trade Commission sued to block the merger, claiming it would hurt workers, stifle competition and raise prices for consumers. Executives at Kroger and Albertsons dispute those claims, saying the merger will result in lower prices and more choices for consumers, and result in no layoffs of “frontline workers.”
On Capitol Hill, opposition to the merger is being led by Sen. Ron Wyden, Oregon’s senior Democracitc senator, and Rep. Pramila Jayapal, a Washington state Democrat. Wyden joins us to share his perspective on the proposed merger.
Note: The following transcript was created by a computer and edited by a volunteer.
Jenn Chávez: This is Think Out Loud on OPB. I’m Jenn Chávez, in this week for Dave Miller. So happy to be back on live radio with y’all today.
Many Northwesterners have bought groceries before at a Fred Meyer or QFC – both owned by Kroger – or perhaps a Safeway, owned by Albertsons. Well, today, a federal judge is hearing arguments to temporarily halt a proposed multi-billion dollar merger of the two companies, Kroger and Alberson’s. The merger, if it does go forward, would create the largest grocery chain in U.S. history. Among the merger’s opponents are the Federal Trade Commission, which sued to stop it earlier this year, and Democratic U.S. Sen. Ron Wyden of Oregon. He and U.S. Rep. Pramila Jayapal of Washington are leading opposition to the proposal on Capitol Hill. Sen. Wyden is with me now to explain what’s at stake with this potential merger and more. Senator, welcome back to Think Out Loud.
Sen. Ron Wyden: Thanks for having me back.
Chávez: Absolutely. So glad to have you here with us in our studios. First of all, why is this issue – a major grocery chain merger – important to you? What made you decide to lead efforts to oppose it in Congress?
Wyden: Well, just yesterday, I was coming back from town hall meetings in Eastern Oregon and I stopped at The Dalles Fred Meyer and was talking to people, and what I can tell you is the reason concern is so high is that Oregonians believe that this merger would create another mega-chain, and that mega-chain would stick it to consumers and employees and we’d have higher prices and lower wages.
And what’s striking about this is the timing. Here we are, looking at the biggest merger like this in American history, and people feel like they’re just getting beaten up when they’re going to buy a gallon of milk or a pound of meat, and the like. And it just seems to me that this is a rush to try to get something that will be very good for these exceptionally profitable corporations, but not so good for working people.
Here are the numbers: In 2023, Kroger and Albertsons brought in gross profits of $32.5 billion and $21.9 billion, respectively, big increases over 2022. So that’s what I heard yesterday at the Fred Meyer in The Dalles, and I’m hearing it all over the state.
Chávez: You know, you’ve mentioned several reasons why you and some of the constituents you’ve been hearing from are against this merger. Of course, Kroger and Albertsons do not agree with these critiques.
We did receive a statement from Tim Massa, the chief people officer of the Kroger Company and it reads in part – quote – Kroger joining with Albertsons will mean lower prices for more customers, higher wages for associates, and expanded food access in more communities. Our merger will secure the long-term future of union jobs by building on Kroger’s track record of adding 100,000 union jobs since 2012, while union membership in the grocery industry was declining by hundreds of thousands of dollars. Kroger, Albertsons and C&S are committed to honoring all current collective bargaining agreements, alongside bargain for wages and benefits and ensuring zero front line worker layoffs.
That’s part of the statement we received. And senator, what’s your response to that?
Wyden: That’s a real mouthful. But here’s the history….
Chávez: But to the question of grocery workers, I think, what’s your response?
Wyden: Well, first, less than a decade ago, Albertsons and Safeway proposed another protection for the workers and the public, and they just didn’t follow through. They failed to buy back many of the divested stores two years later, watched the rest go out of business, workers got hurt. So 2015 is a precedent that runs contrary to these grandiose claims that they’re making, and the reality is, in area after area, Oregonians have reason to be worried.
Kroger, for example, doesn’t accept TRICARE for veterans. And we’ve got a big veteran’s population. We’re losing pharmacies right now. That’s what I saw again, across the state, over the weekend at town hall meetings. People say we’re becoming pharmacy deserts. These two will merge, they will be merging their pharmacy capability and they’ll be able to pound the competition there as well.
So when it comes to specifics rather than grandiose rhetoric and also looking at the past – that 2015 merger – these claims just haven’t worked out by the big guys. The answer to consolidation isn’t more consolidation. And I tell people, when people ask me about my philosophy, is what I’m for is free and fair competition and not mega-mergers.
Chávez: And that same statement from the senior leader of Kroger, the company also committed to – quote – no store closures as a result of the merger. And I know that this, the potential of stores closing, has been another common worry. What concerns do you have more broadly, maybe about that or just about consolidation like this in the supermarket industry?
Wyden: Well, I just think that what we ought to be doing is in effect calling a timeout. That’s why I’m going for an injunction and make it possible to look at all of the various issues. I’ve just cited examples about how veterans get hurt, and consumers get hurt, and small communities get hurt, and they said, well, maybe we’ll keep workers on. But the reality is, UFCW, which initially the United Food and Commercial Workers was looking at this and trying to work something out. They haven’t been treated very well in the negotiations. They haven’t been treated well here locally. They haven’t been treated well nationally. They are exhibit A for why the workers are so skeptical.
Chávez: We did have quite a few listeners on our Facebook page who weighed in on the merger, most of them in opposition. NaTasha Gaskin said, this merger is bad for the consumer. Jessica Sesnon wrote, we already have limited access to stores in our smaller communities. And Brennan Swan said, ever since Albertsons and Safeway merged, their prices have gone up.
So this last point – prices. How do you think blocking this merger would affect grocery prices?
Wyden: Well, I think if you look at the history, you’re reducing competition, and then the merged entity can really stick it to consumers and to veterans and to farmers and just about everybody. I mean, the reality is, right now, when people are complaining about the cost of so many kind of goods, why would you embark on something like this where, as I said, I can cite the evidence with respect to all of these specific concerns. It just defies common sense, and with an injunction, which is what I’m pushing for, we have a chance to listen to all the parties and if this were to go, to find something that would protect the people who are calling the station and complaining.
Chávez: And senator, of course, with you here in our studios, I want to take the opportunity to talk about a couple of other things.
First of all, we find ourselves in the midst of Presidential election season…
Wyden: Is there an election going on? I hadn’t heard that.
Chávez: Yes, it certainly has not been boring!
Looking ahead to election day, state election officials are stepping up efforts to combat misinformation campaigns that are meant to erode trust in the voting process, which of course is especially
important these days. What help do you think you and other members of Congress can provide with this?
Wyden: Well, we’re trying to use the authority of the federal agencies that do work in this area, and they can affect intelligence, they can affect other kinds of areas, to try to get help out to the various jurisdictions. We’ve had a pretty good record of dealing with this, because our officials tend, fortunately, to get the word out early. If there’s one thing that I think is critical when you see this kind of misinformation, when you see people threatening election officials, make sure you get it to us early, because we can look at remedies both at the federal and the state level.
Chávez: Thank you, senator. Another matter top of mind here in the Pacific Northwest, wildfires have burned more than a million acres in Eastern Oregon. And I know you and Oregon’s other Democratic senator, Jeff Merkley, wrote a letter supporting Governor Tina Kotek’s request for assistance for ranchers and farmers affected by these fires, from the Departments of Interior and Agriculture. Do you have a sense of when that federal assistance will be coming for those devastated?
Wyden: We’ve been able to make real progress in terms of helping the farmers with their grazing situation. They very much need hay, and haying is key to make sure that they can get back on their feet. And there’s also an indemnity program when you’ve lost your livestock. So Sen. Merkley and I, both with respect to hay and with respect to livestock, have been able to help. And look, let me tell you about the fire situation, because I’m working to get firefighter pay up, and getting them a permanent increase so that they’ll be able to get paid competitively with other positions is at the top of my agenda.
These are not your grandfather’s fires. They’re bigger, they’re hotter and more powerful. I mean, where I was yesterday for town hall meetings, they know that we’re not even done with the fire season at this point. We got a little bit of a break, a little bit of a respite, and I told everybody, let’s make sure that we can get ready for the next round. And what I really wanna do before we end the show is thank all the volunteers across the state of Oregon who stepped in to help folks who are fighting fires. And without those volunteers, it would have been much worse.
Chávez: And senator, we only have about a minute left together, but I did want to ask you because I know you’re in town on this today. You’ve been doing work around price gouging for pharmaceuticals. What can you tell us about what you have going on in that?
Wyden: We have saved $3 billion under a law that I got passed in 2022 to protect seniors and taxpayers from price gouging. Today we were at the Cancer Society because cancer patients just get clobbered with these medicines that cost way more than the rate of inflation. And I was able to get a price gouging penalty that said, if you keep raising your prices way more than inflation, you’ve got to give the money back to seniors and taxpayers.
And patients who were there at the Cancer Society – our Cancer Society is a wonderful program. But when you go to a doctor’s office, you need help. When you’re getting treated for cancer, the last thing you ought to face is getting clobbered again with prices way, way above inflation.
Chávez: Well, senator, thank you so much for covering so much ground and for being with us today.
Wyden: Let’s do it again.
Chavez: All right. Ron Wyden is Oregon’s senior Democratic U.S. senator.
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