Running for Congress on an Anti-Monopoly Platform (Episode 53)

To help us think about these dynamics and how election campaigns that focus on challenging concentrated power might just be the key to fixing our politics, I’ve asked Austin Frerick to join us on the show today.

Austin launched a campaign last year to win the Democratic nomination for Iowa’s 3rd Congressional District. It’s a district that encompasses the city of Des Moines and a large rural swath of southwest Iowa. Austin eventually had to drop out of the race because he spent too much time talking to voters and not enough time fundraising, but before he stepped aside, he built a strong grassroots following and he’d drawn considerable local and national media attention for the anti-monopoly ideas he was talking about on the campaign trail, and the response he was getting from rural voters. Austin is a seventh generation native of Iowa. He’s also an economist and a fellow at the Open Markets Institute. He joins us today from Kansas City where he’s participating in the Annual Conference of the Organization for Competitive Markets.

Austin, welcome to Building Local Power.

So that kind of got me interested in the whole anti-trust and discovering Barry Linn, the folks at Open Markets. But at the same point, a lot of my family voted for Trump. I like to joke when I say I was probably the only person at Treasury to vote for Bernie Sanders in the primaries, because I don’t think people understood. I think there was a misperception in the capital city, just the pain people feel. And so, I had moved back home because after Trump’s election … I was a civil servant. We don’t have any children yet, so I wanted to run for public office because I thought this was an issue no one was talking about.

I was actually looking at a State Senate seat but then a good friend of mine, retired school teacher, decided to run after … He’s really anti-teacher legislation this past session in Iowa. And also, these anti-trust message, a big component of it is federal. It’s kind of one of those things where I want to move home, I love this message, and it was like, “Oh, this is a competitive primary. This is a very competitive seat.  The stars kind of aligned” sort of thing. It wasn’t like I woke up one morning, but it all made sense but slowly.  It’s also funny to say you launch your congressional campaign based on an academic paper. It’s the nerdiest thing possible. I think it’s kind of funny.

Just seeing you have the world’s best farmland yet the poverty is increasing. You have Red Oak, Iowa which is a town of four or five thousand. Home to senator Joni Ernst. Two out of three kids there are on free or reduced lunch. It’s boils your blood. This system’s broken. You can get a better locally sourced meal in D.C., New York, L.A. than I can at a diner in Iowa.

So, when you thought about being motivated to run on this issue of monopoly and concentration and as you went out and started talking to voters, how did you choose to frame that? How did you actually talk about that, and what kind of response did you get?

And I never said the word anti-trust, but my whole campaign was anti-trust. The examples I would use to suburban Des Moines audiences is very different than a rural community. And I have to learn that. That’s up to me to learn as a politician how to communicate this to you and how it impacts your life, and that just takes practice. There’s times I’ve failed, and you just get back up. You ask people “How can I do this better?”  But because of this current model of campaign, a lot of candidates don’t do that. They just fundraise and they essentially rely on D.C. consultants to do a random poll and tell them how to talk.

So, the challenge I had honestly was how do I get to you when people are iglooing. How do I get to your message. For them, the message I found resonating was just hey, I was a Democrat talking, just knowing what corn prices are. Understanding what $7.00 corn, $3.00 corn, talking about their pocketbook with feed costs. You can talk about monopoly, when I say that corn feed tripled in price in ten years, and I promise you didn’t triple as good, A, I’m showing respect to your profession. B, I’m validating your anger.

And so it’s that coupled with, especially in rural communities that sense of self-sufficiency and you can’t feed your own kids really connects well. The loneliness, I mean that’s what farm consolidation does. I don’t think humans really grasp it yet. When you had seven farms living on one street and it becomes one or two, it’s lonely.

There are a lot of social ties that are built that way and they’re kind of weak social ties in the sense that these are people that are more acquaintances sometimes than lose friends or those are more neighbors than close friends and yet those ties are really valuable. I think there’s a way in which that gets overlooked and it’s happening, as you know, across rural America too.

The one thing that gives me hope now is farmer’s markets because that’s kind of filling that void. But no, I totally agree with you. It’s an under-appreciated thing because a lot of those coastal communities, it’s fine. It’s a robust civic society but with the hollowing of local news, you don’t see that. I mean Southwest Iowa, Warren Buffet owns most of the newspapers.

And, I’ve had small town publishers tell me they agree with the Monsanto … I really focused on opposing Bayer-Monsanto’s merger. That’s also one of the largest ad buyers. They’re barely getting by. They’re losing subscribers. They’re losing their advertising base. Why bite the hand that feeds them?

And so, what counts is what can be measured and things that are harder to measure or can’t be measured aren’t on the table, even though those impacts are exactly what we should be considering in the context of a merger. Say if you merged two companies and it has these downstream effects on all these communities and the health of those places, that really matters. It use to be part of how we though about merger review before it was so quantified before kind of the economists, the cult of economics profession sort of came in and redid how we review mergers to make anything that isn’t really a price effect that can be measured not on the table, not part of the analysis.

But he’s saying, “Our next thing we are concerned about is we have a lot of Sudanese moving in, so we have to essentially make sure that we have the resources to have Arabic translators.” You don’t see that in the data. I can sit in my little D.C. cubicle, look at my Excel sheet I wouldn’t know that. But, I think part of the cult of efficiency is just laziness.

I got so much pushback for supporting 5 for 15. I think that’s part of the problem is because the financing, they control it and candidates have to devote a disproportion amount of time because Barbara Barrens can drop a ton of money on you and you have to raise a lot of money to go tit for tat. How do you have a voice in that? I mean then you see candidates who break that mold and it gives you hope this cycle.

The other one is a woman named Deidre DeJear, and she’s this African-American woman running for Secretary of State. She’s one of those people, you know when you meet someone they’re just like they radiate your life?

Just part of what concerns me now is people have nationalized their news intake. They read the New York Times or whatever kind of food public … whatever kind of interest publications. People really are kind of losing touch with what’s going on in their own communities. Local news doesn’t have that money so a lot of people don’t know. So, it’s like finding out, helping those candidates get their message out is so important.

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Just turning back to the anti-monopoly approach, there’s this really interesting quote that I saw from you where you said you can try to organize workers at a slaughterhouse all you want but if that company has 60 percent market share, they can just shut it down. I thought that was interesting because it really spoke to the fact that for a long time the focus for people organizing around worker justice has been how do we reinvigorate Unions, how do we raise the minimum wage, and those things are important but you’re really pointing to the fact that concentrated power, if we don’t confront that, this other stuff may not matter.

I think what you saw happen is a tyrant came along, exploited that anger and just instead of blaming Tyson, he blamed the bottom person. There’s validity to the anger a lot of people feel, it’s just these companies have so much resources and they will crush you. I’ve seen it with tons of sustainable agricultural candidates in Iowa. You have them and their cronies at the Farm Bureau will just dump a lot of money on you. A lot of times I’ve seen Democrats who can’t co-op these. You’re incredibly naïve if you think you can take their money and neuter them in a way. Like no, they are gonna … these will only intensify. So, I think it’s just confronting it head on.

Also, it’s like David versus Goliath. I think candidates anymore, why fundraise all the time to buy media, earn media because it’s so much funner than being in a little box calling people all day for money. It’s fun being out there helping being a part of a fight for 15 protests, being part of a final protest. Get to know those communities but make sure you talk about it on social media. Make sure you tell that local newspaper, all that kind of stuff.

I mean the scary thing about this moment too is how much of the business community is going to ignore the President’s very … I mean I don’t know what words to use to describe what he says because you can’t even attach that. We talked about this once at Treasury and we all … everyone’s kind of like cowers when you say the word but there’s some dancing around fascist lines really close.

I regret not working as hard for 2016 as I did for prior elections and making sure, as October and November comes, telling everyone, every person you know, like “Make sure you vote.” Here’s what I mean. This is why I care about a candidate. Donating to candidates as almost like donating to causes. The candidates you really think … you really connect with their message, give ’em money. Give ’em your time. Have that be your Saturday activity.

I’m also that we can usually, in the darkest moments of our country, we have these great moments really for … it took that gilded age to make that progressive movement. I hope we can see a second gilded age to get to that second progressive movement. So, we are dancing so close to so many lines right now.

One of my favorite works you guys are doing is that North Dakota pharmacy stuff. I had never heard about it until a few months ago. The fact that, was it pharmacy has to at least be 51 percent owned by a pharmacist?

We just see this in so many sectors. Another one that comes to mind is broadband provision. If you push back against Comcast and Time Warner, I mean one of the things you’ll hear from their supporters is the reason that our broadband prices are so high in the U.S. compared to the rest of the world is that we’re a very largely rural country where everything is really spread out and it costs a lot of money to extend these cables and everything to a more spread out kind of population than say in Europe or elsewhere.

And then, what’s so funny and ridiculous about that is that the lowest broadband prices for in this country are actually in rural areas where there are small co-ops and other providers that have built these high speed fiber networks that are better and cheaper than what Comcast and Time Warner are doing in cities. The reason that those companies are so expensive is because they have a monopoly in most places. That’s what’s really going on.

It’s challenging to … I realize in going out and making these kinds of arguments or pointing to this information that people are … it’s hard for them to see it in a way because we’re so steeped in the ideology that bigger is cheaper, and that yeah, we might be nostalgic about the loss of the local business, maybe they’re these sort of touchy feely reasons why we miss them but a hard-nosed kind of analysis is that they really can’t compete. That ideology is so prevalent that even when you present people with that information it doesn’t always really sink in.

I was downtown and I had stumbled upon a men’s store. You don’t see men’s stores anymore. I can probably count on one hand how many are in Iowa. Went in and it was really good customer service, young guy taking over his dad’s business. In my head I was like “Oh, I’m gonna pay way more than anything I would pay at a bigger store. I’m gonna buy a nice pair of socks, that way I can give ’em some business. Feel good about myself.” But, I figured in my head “Oh, I’m paying four or five more dollars.” I went online later to price check. His socks were the same price.

It’s a simple little thing where like in my head I’m thinking I’m paying a price premium, that feel goodness and it’s just not true but it’s so ingrained in us.

So, he ended up writing a completely different story, which was he said, “I’ve been shopping at Amazon on the theory that I’m saving money and it turns out I should have been going to this local hardware store all the time.” It’s again, sort of more of that ways in which we have these blinders on that are really about ideology not about actually seeing what’s right in front of us.

It’s just simple things. But, professional class people, you don’t have a little dinger on you. People screw up.  You know, if they’re not feeling good, they might screw around on Buzzfeed for an hour. God, I almost used this term called low-skilled worker. I think that’s one of the most patronizing things in economics. I remember I said that to my mom once. And, my mom use to work at a Starbucks, and it takes a lot of skill to socialize for ten hours, to be on your feet. And, it was just one of those things that came out of my mouth because I was so use to that ecom jargon. You’re like that’s so dehumanizing.

I didn’t mean to go on a rant on that but just the respect of Christmas parties, holiday parties, that sense of … you’re seeing them disappear. You’re seeing that kind of … because a lot of these executives, these consolidated entities don’t even live in the community. They’re not on the same soccer team anymore. They don’t see what it means, what these policies mean for people. I mean you had Quest from Iowa. You had a candy factory close because it was going through a merger ten days before Christmas and fire 250 employees. Why would you do that to a human being, having them lose their job ten days before the holidays? Why not wait until January, February? Where’s that decency?

So, it’s great to have you on the show. I’ve really enjoyed listening to you and hearing more about what you’re talking about in Iowa and what you see as ways to change these things.

But, if you have ten communities trying to do it, they’re going to start being stretched thin. And once you make a crack in them, we win. We’ve all just got to keep taking those hits. You know, speaking truth’s a power because then you get these moments where someone breaks through and then it’s a different game changer.

For the Institute for Local Self-Reliance, I’m Stacy Mitchell. I hope you’ll join us again in two weeks for the next episode of Building Local Power.