Senator Casey takes after Biden, introduces Shrinkflation Prevention Act

28 February 2024- U.S. Senator Bob Casey (D-PA), Chairman of the Senate Health, Education, Labor, and Pensions (HELP) Subcommittee on Children & Families, introduced the Shrinkflation Prevention Act to crack down on corporations that deceive consumers by selling smaller sizes of their products without lowering the prices. Since November 2023, Chairman Casey has been investigating corporate price gouging and other actions by big corporations that have squeezed the budgets of American families and contributed to the increase in inflation. Recently, the New York Times featured Senator Casey’s investigation into shrinkflation.

“Corporations are trying to pull the wool over our eyes by shrinking their products without reducing their prices—anyone on a tight budget sees it every time they go to the grocery store,” said Senator Casey. “Pennsylvania families are sick and tired of digging deeper into their wallets for their weekly grocery runs while corporate CEOs laugh all the way to the bank. I’m fighting to crack down on shrinkflation and hold corporations accountable for these deceptive practices.”

During the COVID-19 pandemic, the Senator says, big corporations took advantage of the crisis to prey on consumers through greedflation: raising prices by even more than necessary to cover increases in their costs, and hiding behind inflation and supply chain disruptions to do it. Now that the market shock of the pandemic has largely abated, corporations’ costs are coming down and profits are rising. But for American families, prices remain high.

Chairman Casey says in a statement that he believes more must be done to hold corporations accountable for taking advantage of American workers and their families and has a plan to lower costs for working families by following four overall goals: put more money in the pockets of working families; make big corporations pay their fair share; fight unfair corporate price gouging; and take on corporate monopolies to increase competition and lower costs.

In January 2024, Casey released his fourth report of his greedflation series, “Additional Charges May Apply: How Big Corporations Use Hidden Fees to Nickel, Dime, and Deceive American Families detailing how big corporations are tacking on excessive fees at the tail end of everyday purchases, from internet plans to ATM withdrawals. Senator Casey believes that no Pennsylvanian should be blindsided by a junk fee and that the negative impacts of hidden fees can be mitigated by: fighting deceptive practices that allow corporations to hide the fees they charge consumers; preventing corporations from deceptively passing along their expenses to working families through bogus fees; and protecting businesses that are honest about their pricing structures.

In a letter to the Government Accountability Office that same month, Chairman Casey pushed the government watchdog to examine the effects of corporate greed on American consumers. In February 2024, Casey introduced legislation to protect American families from greedflation by banning grossly excessive price increases and crack down on corporate price gouging.

The Shrinkflation Prevention Act would:

  • Direct the FTC to promulgate regulations to establish shrinkflation as an unfair or deceptive act or practice, prohibiting manufacturers from engaging in shrinkflation
  • Authorize FTC to pursue civil actions against corporations who engage in shrinkflation
  • Authorize state attorneys general to bring civil actions against corporations engaging in shrinkflation

This legislation is cosponsored by U.S. Senators Tammy Baldwin (D-WI), Elizabeth Warren (D-MA), Jacky Rosen (D-NV), Cory Booker (D-NJ), Sheldon Whitehouse (D-RI), Sherrod Brown (D-OH), Patty Murray (D-WA), and Bernie Sanders (I-VT).

The bill is endorsed by Groundwork Collaborative, Public Citizen, Consumer Federation of America, and WorkMoney.

Read more about the Shrinkflation Prevention Act here.