Rihanna - Lift Me Up

Under Pressure, Snyder Selling Commanders Before He is Forced Out

More than a decade ago, the Washington City Paper's Dave McKenna offered NFL fans the definitive guide to the lameness of NFL owner Daniel Snyder.   Snyder was widely considered to be the ultimate cheapskate-- selling his fans stale beer and expired food products.  He even once tried to get media outlets to stop using the team name without permission.  As if  charging some of the league's highest prices for parking and beer wasn't enough to alienate his fan base!

For years, the short-statured owner refused widespread calls to change the racist name of the team-- even in the face of losing the legal trademark on the team's namesake.  Snyder finally succumbed to the pressure and changed the team's name to the one of the worst options available to him.  Nevertheless, Snyder continued to operate the worst stadium in the league-- in fact, part of the stadium collapsed just last season following an Eagles-Commanders game.  Yikes!

Now there are indications that the embattled owner is finally being forced to sell the team.  According to Forbes magazine, Snyder has hired Bank of America to sell the team.  The diminutive executive  already has at least four calls from groups interested in buying the team. Snyder and his bankers are exploring all options, and a transaction could be for the entire NFL team or a minority stake.

It's become obvious why little Danny Snyder is trying to unload the team.  The U.S. attorney’s office in the Eastern District of Virginia has opened a criminal investigation into the organization over allegations that the team engaged in financial improprieties. Government prosecutors are investigating evidence that the Commanders withheld ticket revenue from visiting teams and refundable deposits from fans.  In 2016, a U.S. House committee found that the team had kept up to $5 million from season-ticket holders and concealed sharable revenue from the league.

The Commanders kept two sets of financial records. One of them was for "under-reported ticket revenue that went to the NFL" and the other was the "full, complete picture" of the organization’s finances. Snyder was aware of this and "also being privy to the actual data."

Congress began investigating the team in October 2021 when allegations of sexual harassment and workplace misconduct arose after emails from then-Commanders team president Bruce Allen were leaked.  Snyder was found to have played a significant role in fostering a toxic work environment and he even went so far as to impede the NFL’s independent probe into those allegations. Snyder refused to testify at a hearing before House lawmakers in June as part of the investigation. 

Indianapolis Colts owner owner Jim Irsay publicly called for Snyder's removal during the NFL fall meetings in New York, stating there was "merit" to do so after ESPN reported that Snyder had hired private investigators to dig up dirt on other NFL owners to insulate himself from disciplinary action.  NFL policy stipulates 24 of the league's 32 owners must vote in favor of a removal in order for Snyder to be ousted. An NFL owner has never been voted out.   It's looking like Snyder is going to bail out before that happens.

Feliz Dia de Los Muertos

Bridge Collapse in India Kills 134

The death toll from a foot bridge collapse in India rose to 134 on Monday, including many children, as police detained nine people as part of a criminal investigation into one of the deadliest accidents in the country in the past decade.

CCTV footage from just before the collapse showed a group of young men taking photos while others tried to rock the suspension bridge from side to side, before they tumbled into the river below as the cables holding it together gave way.  Police in the western state of Gujarat, where the disaster occurred, told Reuters they had detained nine people after registering a criminal case against unnamed people responsible for the renovation, maintenance and management of the bridge.

Ashwin Mehra, who was undergoing treatment after sustaining leg and back injuries when he plunged from the bridge, said he and six others had reached the shore by holding onto the bridge’s metal railings and netting.  “Some 15-20 mischievous young kids were shaking the ropes of the bridge. Three times a noise came from the bridge before it collapsed,” he said.

Local officials said that the manager of the bridge, a company making clocks and electrical items, had not informed the authorities that the bridge would be reopened after repairs, adding that no certificate that it was fit for public use had been issued.  The colonial-era footbridge over the Machchhu River in the centre of Morbi town was packed with sightseers enjoying holiday festivities when it collapsed on Sunday evening, plunging people about 33 feet into the river.  Some 400 people had bought tickets to get onto the bridge to celebrate the Diwali and Chhath Puja festivals.

About 35 victims were under 14, according to a list of the deceased seen by Reuters. About 170 people had been rescued by the morning.  “People were hanging from the bridge after the accident, but they slipped and fell into the river when it collapsed,” said Raju, an witness who gave only one name. “I could not sleep the entire night as I had helped in the rescue operation. I brought a lot of children to the hospital.”  Narendrasinh Jadeja, whose friend lost seven members of his family, including four children, said: “I cannot express how angry and helpless I am feeling.”  A government official said at the site that the river’s muddy waters were hampering rescue work and that there might be people trapped under the remains of the bridge.

Gujarat-based electrical appliances maker Oreva group, known for its Ajanta clocks, had been in charge of maintaining the bridge for 15 years, said Sandeepsinh Zala, the chief officer of Morbi municipality.  “They did not give us any information that they were reopening the bridge,” Zala said. “We have not issued any fitness certificate to them.”  Jayrajsinh Jadeja, a local lawmaker from Prime Minister Narendra Modi’s Bharatiya Janata Party, blamed Oreva for selling tickets without restrictions and said overcrowding led to the bridge collapse.  The bridge was previously maintained by the local municipality, which limited the number of people on the bridge at one time to 20, he said.

The bridge is 4 feet wide and 255 yards long, connecting the Darbargadh Palace heritage hotel and the town. It was built in 1877 when India was a British colony.  Opposition politicians in Gujarat, where elections are due by early next year, said the disaster exposed the lack of oversight of infrastructure in the country.  “Not just extremely sad on bridge collapse in Morbi but also very angry. Because it was a tragedy in waiting,” Gurdeep Singh Sappal, a member of the Congress party, wrote on Twitter. “For some time now, bridge collapse, roads caving-in, dams breaching are happening quite often.”

Happy Halloween

Kroger Merger a Bad Deal For Consumers

Kroger, which operates around 2,700 stores, plans to acquire Albertsons, which has around 2,200 stores. Announcing the planned merger, Kroger CEO Rodney McMullen hinted that it would lead to lower prices for customers-- so says the man whose previous wisdom includes that “a little bit of inflation is always good in our business.”

Many people aren’t so sure that cost savings will materialize—and some are warning that the merger could increase prices. There’s damn good reason for suspicion. Grocery prices were up 13% in September over the previous year, while Kroger profits have risen, pointing to the retailer raising prices more than was necessary to account for its costs. Add that to the manufacturers of products being sold in supermarkets also having increased prices more than necessary to juice their own profits, and you start understanding why grocery prices are high right now.

A year ago, before this merger was proposed, Kroger “spent the summer of 2021 gloating that ‘a little bit of inflation is always good in our business’ before citing inflation to justify price hikes. Kroger publicly acknowledged that they could get away with increasing prices on consumers as long as prices didn’t rise by more than 3 or 4 percent.”  Then, in October 2021, Kroger’s chief financial officer said the company was “very comfortable with our ability to pass on the increases that we’ve seen at this point [...] and we would expect that to continue to be the case.”  So no-- we can’t take Kroger and Albertsons at their word when they say that, following a merger, they’ll invest in lower prices.

Companies wanting to merge often claim that economies of scale will allow them to decrease prices, but it doesn’t tend to work out that way. One 2008 study looked at five mergers and found that four of them led to increased prices. Michael Hiltzik at the Los Angeles Times looks at some more recent mergers—2011’s Comcast merger with NBCUniversal, 2018’s AT&T acquisition of Time Warner, the 2017 CVS-Aetna merger—and finds that they were justified with the likelihood of lower prices that didn’t exactly materialize.

“At a time when grocery prices are soaring, in part because of monopolies in the food chain, this merger makes no sense,” former Labor Secretary Robert Reich told Hiltzik. “The current food inflation has two sources: (1) Grain prices have been increasing around the world because of grain shortages brought on by the war in Ukraine and climate change. (2) Domestic monopolies in seeds, fertilizer, and food processing have used the cover of inflation to raise their prices higher than their increasing costs — including the costs of agricultural commodities, labor and transportation.”

“There is no reason to allow two of the biggest supermarket chains in the country to merge — especially with food prices already soaring,” Sarah Miller, executive director of the American Economic Liberties Project, said in a statement when the plan was announced. “With 60% of grocery sales concentrated among just 5 national chains, a Kroger-Albertons deal would squeeze consumers already struggling to afford food, crush workers fighting for fair wages, and destroy independent, community stores. This merger is a cut and dry case of monopoly power, and enforcers should block it.”

On Tuesday, Sens. Elizabeth Warren and Bernie Sanders, along with Rep. Jan Schakowsky, wrote to Federal Trade Commission head Lina Khan, asking her to oppose the merger. “Kroger’s and Albertsons’ histories of aggressive profiteering during the pandemic present a dangerous roadmap for how a larger and more powerful company would act if this acquisition were allowed to proceed,” they wrote.  They also highlighted concerns for workers at the merged company, noting not just how Kroger cruelly cut off their employee's hazard pay just weeks into the COVID-19 pandemic.  “Kroger and Albertsons have both faced allegations of unfair labor practices and unsustainable conditions for their employees, concerns that could be compounded by this merger. A 2021 survey by the Economic Roundtable of more than 10,000 Kroger workers found that 75 percent of Kroger workers reported being food insecure, and more than 60 percent did not earn “enough money to pay for basic expenses every month.”

Sanders, Warren, and Schakowsky aren’t the only public officials with concerns. Rep. Kim Schrier, a Democrat from Washington, wrote her own letter to Khan, noting, “Last year, Kroger openly stated it was passing on higher costs to consumers while posting some of the largest profits in decades.”

Will this merger go through? The FTC’s Khan has started out with a much more aggressive approach to anti-trust enforcement than her recent predecessors, and Democratic lawmakers are obviously mobilizing to put pressure on the deal. But whatever happens with this merger, a close look at Kroger and Albertsons is a reminder of just why grocery prices and corporate profits are so high at the same time.

 

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