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Lawmakers consider how a Kroger-Albertsons merger would affect consumers

RACHEL MARTIN, HOST:

High inflation has Americans paying close attention to how much we all spend on groceries. And now two of the nation's biggest grocers are planning to merge, becoming a supermarket giant big enough to compete with Walmart. Kroger is trying to buy Albertsons for $25 billion. Safeway, Harris Teeter and Fred Meyer would all be part of the same corporation as a result. Some lawmakers are concerned about how that might affect consumers. Democratic Senator Amy Klobuchar of Minnesota is one of them, and she is among the group of senators holding a hearing on this today. Senator, thanks for being here.

AMY KLOBUCHAR: Well, thanks so much, Rachel. And it's great to be on to talk about what, as you know, is beyond grocery stores. Whether it's Ticketmaster, whether it is tech companies, we are seeing so much consolidation in our economy from cat food to caskets. And this is one big example of it.

MARTIN: So let's talk about this. How - put - help us put this particular proposed merger into context. If this grocery store merger goes through, how many communities would be affected?

KLOBUCHAR: It would affect literally every community in the country because so many communities have one of these stores or could have one of these stores in the future. So let's go with the Kroger brands are - Kroger's (ph) has Kroger's, and it has Food 4 Less. It has Harris Teeter, Fred Meyer, King Soopers, Ralphs. Albertsons has Albertsons, Safeway, Balducci's, Jewel-Osco - you name it - Pavilions, Vons. And when you combine them, it's the No. 1 and No. 2 grocery stores in the country. The FTC will be ultimately making the decision on this proposed merger, but we have a hearing. Senator Lee - you know, conservative Republican.

MARTIN: Mike Lee of Utah.

KLOBUCHAR: He and I - yeah, we're holding a bipartisan hearing. And the whole focus is, let's get the information from these two CEOs and other witnesses under oath - helpful for the FTC to make its decision, but also for the senators, because we're considering legislation relevant overall with antitrust, given the changing economy that we're seeing right before our eyes...

MARTIN: So what are you...

KLOBUCHAR: And the effect it has on costs and quality. Go ahead.

MARTIN: What are you worried about, Senator? I mean, is there evidence that this merger goes through and automatically prices go up?

KLOBUCHAR: Well, what you're worried about - first of all, these stores have already come forward and said, you know, we are directly competing with each other, so we would have to divest at least 375 stores. That means sell them off. This was tried before by Albertsons in the past. And what happened was the company they sold them to - of the 100 divested stores, as a result, 100 of them - of the 150 stores, 100 of them were actually closed for good. Eight thousand people were laid off. We know that...

MARTIN: So that means potentially there will be communities with fewer grocery stores, you're saying?

KLOBUCHAR: Exactly. And you have got areas in our country - maybe not where everyone lives that's listening, but that have no access. They maybe have one store. They maybe have two stores. And one-third of the grocery stores have closed in the last 25 years, leaving over 10% of Americans in low-access food areas. So - and that's rural and urban. And, you know, it's not the same thing as they may argue today to go to, say, a CVS and try to find some food in there. Yes, you're going to be able to get milk and a few other items, but it's certainly not the same thing as having access to fresh food and the like.

MARTIN: So what specific questions are you going to ask today?

KLOBUCHAR: Well, we're going to ask about how the proposed merger will affect consumers - No. 1 question. No. 2 - how are they going to handle these stores that they divest, and will there be even more? And No. 3 - we still don't have the number on - when you look at the grocery store market and you don't include things like restaurants, we still don't have the number of what their combined dominance will be, No. 1 and 2. So we want to get that number because they are throwing in a bunch of things that we don't believe are the same. And then their commitments to lower prices and improve wages - if this does go through, what are they going to do with the cost savings they get from combining the companies? Are they committed to lower prices and improved wages?

MARTIN: Democratic Senator Amy Klobuchar of Minnesota, we so appreciate your time. She is helping to chair a hearing today on a proposed merger between the two largest grocers in the country. Senator Klobuchar, always a pleasure to have you on. Thank you so much.

KLOBUCHAR: Well, thank you, Rachel. It was great to be on, and thank you for covering this issue. It's, like, the biggest issue that not everyone is talking about, monopolies. And it's - you're starting to see the effects throughout our nation's economy. I believe in capitalism, and we must have competition.

MARTIN: Thank you, Senator. Transcript provided by NPR, Copyright NPR.