Marc Levinson – The Great A&P and the Struggle for Small Business in America
This is an excellent history that is playing out again in today’s antitrust revival. A&P was the first nationwide grocery store chain. Though it barely exists today, in its prime it was the nation’s largest retailer. A&P inspired fear among its competitors and outrage among populists.
People made many of the same arguments against A&P in the popular press and in antitrust cases that people make today against Walmart, Amazon, and other big companies. The word choices, hyperbole, and breathless tone are almost identical. And yet, A&P was no match for consumer preferences, which eventually shifted elsewhere. The company chose not to adapt, and today exists on roughly the same scale as Blockbuster Video, which is down to a single store in Oregon.
Some of the very same charges, such as A&P’s selling self-branded products at lower prices than outside brands, are being revived today against Amazon. A&P-era arguments are even being repurposed to argue against Apple and Google’s app stores and search results. Not only were their business practices never anti-competitive, they clearly weren’t enough to save A&P from the competitive process. Nor will it be enough to save today’s big tech companies. Consumers are harsh sovereigns, and as soon as someone does it better, they’ll move on.
History does not repeat itself, but it often rhymes. Levinson digs up some of the lost stanzas of a poem being rebooted all over Washington today. There are lots of lessons here for people on both sides of the antitrust revival.
Inertia Wins! 