Cicilline cautious on proposed CVS-Aetna merger

Dec. 12--Congressman David Cicilline argues the United States is in a "monopoly moment" as mega-mergers have concentrated economic power at the expense of workers, but that hasn't put the proposed $69-billion marriage of Woonsocket-based CVS and insurance giant Aetna in his crosshairs.

On the same week he attacked "the hoarding of economic growth by corporate monopolists" in a speech to a Washington nonprofit, Cicilline, the ranking Democrat on the House Antitrust Subcommittee, took a wait-and-see approach to the recently announced CVS-Aetna deal.

"CVS is a great Rhode Island company. They provide good-paying jobs for 8,000 Rhode Islanders and generate billions of dollars in economic activity each year," Cicilline wrote The Journal in an email.

"This proposed acquisition represents a major development in our health-care delivery system, and we need to understand its impact on Rhode Island jobs, wages, costs to consumers, and innovation in the marketplace," he added. "I'll be meeting with CVS officials in the coming days to learn more about this transaction."

A member of House Democratic leadership helping craft the party's national economic message, Cicilline struck a more populist note in his speech to the anti-monopoly Open Markets Institute last week, attacking "waves of anti-competitive mergers -- deals that should never have made it out of the board room," according to a copy of remarks prepared for delivery.

"...For too long, wave after wave of large corporate mergers have decimated jobs and wages while rigging the economy against locally owned businesses, working families, and entrepreneurs," Cicilline said in the speech. "Business dynamism -- a key measure of productivity and economic growth -- has steadily declined over the past several decades as the economy has become dominated by fewer and fewer large corporations."

Beyond corporate mergers, Cicilline's speech also hit on a number of other economic matters, including state-governed issues such as occupational licensing and non-compete agreements.

According to critics, strict education and training requirements act as protection for incumbents while forming a barrier for unemployed people trying to break into the labor force.

A recent report from the libertarian Institute for Justice found Rhode Island required licenses in 72 of 102 lower-income jobs it reviewed and ranked the state's licensing the 27th most burdensome in the country.

The conservative Rhode Island Center for Freedom and Prosperity has identified reducing licensing requirements as a potential area for cooperation with the Democrat-dominated General Assembly in the year ahead.

"This is nothing short of a weaponization of safety requirements against the economic security of working American families," Cicilline said about over-licensing in his speech to Open Markets.

Cicilline also took aim at non-compete clauses, contract provisions barring workers from working for a competitor.

California does not enforce non-compete agreements, which some experts cite as a factor in its booming technology industry, but bills introduced in the General Assembly that would do the same in Rhode Island have gone nowhere.

On the CVS-Aetna deal, Rhode Island's other U.S. House member, Rep. Jim Langevin, struck a similarly cautious tone.

"CVS is an important pillar of Rhode Island's economy that employs thousands, and its locations across the country provide access to vital supplies and quality medical services," Langevin said in an email statement. "As the proposed acquisition of Aetna proceeds, I look forward to learning more about the merger's effects on Rhode Islanders and how the combined company will maintain consumer choice and promote care integration while helping to combat rising health costs."

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