Heinrich Cosponsors Bill to Crack Down on Big Corporations Shrinking Products Without Reducing Prices
WASHINGTON — U.S. Senator Martin Heinrich (D-N.M.) cosponsored the Shrinkflation Prevention Act, legislation supported by President Biden to crack down on corporations that deceive consumers by selling smaller sizes of their products without lowering the prices. This builds on Heinrich’s work as Chairman of the U.S. Joint Economic Committee to fight corporate greed and price gouging, including his recent report going after corporate consolidation, lowering costs, cracking down on junk fees, and supporting unions.
“New Mexicans work hard for every dollar they earn and it's a slap in the face when big corporations get away with raising prices while reducing the size of food products,” said Heinrich, Chairman of the U.S. Joint Economic Committee (JEC). “I’m proud to cosponsor the Shrinkflation Prevention Act to crack down on corporate greed, cut costs, and put more money into the pockets of working families in our state.”
Shrinkflation is one of several tactics corporations use to hike prices and increase profits. It occurs when a corporation reduces product size without lowering the price. As a result, the unit price increases, and the consumer spends more money for less product. Because the size change is often not advertised, consumers may be unaware that they are getting less bang for their buck.
The Shrinkflation Prevention Act would prohibit shrinkflation by giving the Federal Trade Commission (FTC) and state attorneys general authority to crack down on corporations deceiving consumers. Specifically, the legislation would:
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Direct FTC to promulgate regulations to establish shrinkflation as an unfair or deceptive act or practice, prohibiting manufacturers from engaging in shrinkflation;
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Authorize FTC to pursue civil actions against corporations who engage in shrinkflation;
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Authorize state attorneys general to bring civil actions against corporations engaging in shrinkflation.
The legislation was led by U.S. Senator Bob Casey.
Alongside Heinrich, the bill is cosponsored by U.S. Senators Tammy Baldwin (D-Wis.), Elizabeth Warren (D-Mass.), Jacky Rosen (D-Nev.), Cory Booker (D-N.J.), Sheldon Whitehouse (D-R.I.), Sherrod Brown (D-Ohio), Patty Murray (D-Wash.), and Bernie Sanders (I-Vt.).
The bill is endorsed by Groundwork Collaborative, Public Citizen, Consumer Federation of America, and WorkMoney.
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