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Massachusetts Sen. Elizabeth Warren and New York Rep. Alexandria Ocasio-Cortez announced plans to introduce legislation Tuesday to prevent large corporations from taking over small businesses during the current period of coronavirus-related financial duress.
Called the Pandemic Anti-Monopoly Act, the bill would impose a moratorium on risky mergers until the Federal Trade Commission has decided that small businesses, workers and consumers are no longer in a position of severe financial vulnerability.
Specifically, the rule targets companies with more than $100 million in revenue or market capitalization, hedge funds, private equity companies and businesses with exclusive patents on pandemic-related items.
"As we fight to save livelihoods and lives during the coronavirus pandemic, giant corporations and private equity vultures are just waiting for a chance to gobble up struggling small businesses and increase their power through predatory mergers," said Warren. "We're introducing legislation to protect workers, entrepreneurs, small businesses, and families from being squeezed even more by harmful mergers during this crisis and any future national emergency."
Small businesses throughout the country are suffering, many having been forced to close entirely under strict lockdown guidelines. The legislation is based on the idea that larger businesses, which are better positioned financially to weather the near-term economic pain, may be waiting on the sidelines to buy out smaller businesses.
Warren in particular, who ended a failed bid for the Democratic presidential nomination earlier this year, focused her campaign at taking down greed on Wall Street, which included breaking up what she perceived as monopolies. Some of her policies even called for undoing mega-mergers that had previously been approved.