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1, 1998 2:17 PM
FOR IMMEDIATE RELEASE
CONTACT: Consumer Project on Technology / Essential Action
James Love or Robert Weissman, 202-387-8030
|Consumer Groups Criticize Exxon-Mobil Merger Proposal|
- December 1 -
James Love, director of the Consumer Project on Technology, and Robert Weissman,
co-director of Essential Action, today released the following statement:
The Teddy Roosevelt-era trustbusters had it right when they busted the Standard Oil monopoly. Now it is time for the current Federal Trade Commission to preserve what is left of their work and block the proposed Exxon-Mobil merger.
If the antitrust authorities fail to block a merger between the number one and number two U.S. oil companies, it will predictably lead to more mergers and an even higher level of industry concentration.
The proposed merger will predictably raise consumer prices, especially in the many areas where Exxon and Mobil compete directly.
The purported "economies of scale" from the merger are fallacious. If either or both of the companies have excess refining capacity, they can sell and close their facilities without a merger. If they are bureaucratically bloated, they can shrink their corporate offices without merging. They can and do have numerous joint ventures in every aspect of the business. The merger is completely unnecessary to achieve efficiencies, and it is motivated entirely by a desire to limit competition.
A combined Exxon-Mobil would be the largest industrial corporation in the United States. A combined "Exx-bil" will be able to exert enormous leverage over policymaking in Congress and the executive branch in a myriad of areas, including the crucial issue of global warming. A more de-concentrated industry is relatively less able to exert such power, and more prone to internal division and conflict.
If the Exxon-Mobil merger is permitted to proceed, it will open the floodgate for a rapid series of mergers not only in oil but in other leading sectors of the economy.
The Consumer Project on Technology and Essential Action are both Ralph Nader-founded groups.
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