Bill empowers Federal Trade Commission and state attorneys general to crack down on corporations reducing product size without a reduction in price
Since fall 2023, Senator Casey has produced four reports detailing his investigations into corporate greed squeezing families’ budgets
According to government data compiled in Casey’s greedflation series, from June 2020 through June 2022, inflation rose by 14 percent while corporate profits rose by more than 74 percent
Federal Reserve research found corporate profits accounted for all of inflation from July 2020 through July 2021 and 41 percent of all inflation from July 2020 through July 2022
Casey to New York Times this week: “You can’t wait a year to buy paper towels or to buy boneless chicken or to buy groceries or to buy Huggies diapers.”
Washington, D.C. – Today, 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.”
"Corporations are using deceptive practices like shrinkflation to increase profits on the backs of consumers,” said Lindsay Owens, Executive Director, Groundwork Collaborative. “Charging families the same price—or an even higher one—for smaller products should be illegal and the Shrinkflation Prevention Act is a first step to putting a stop to this deceptive practice once and for all."
“When corporations reduce their product’s size while maintaining the same retail price, they are simply attempting to rip off their consumers,” said Lisa Gilbert, Executive Vice President, Public Citizen. “Public Citizen welcomes this common-sense legislative effort from Senator Casey which would empower the FTC to define shrinkflation as the inherently deceptive act that it is, and move forward to regulate it.”
During the COVID-19 pandemic, 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 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 November 2023, Chairman Casey released the first report in his greedflation series, “Greedflation: How Corporations Are Making Record Profits on the Backs of American Families,” detailing how big corporations are using inflation as cover to raise prices and rake in record profits at the expense of middle-class American families and laying out Senator Casey’s vision to hold greedy corporations accountable. Corporate executives claim they’ve “earned the right” to raise prices and that their products “are worth paying a little bit more for.”
Ahead of Thanksgiving, Casey released his second report, “Stuffing Their Pockets: How Big Food and Agriculture Businesses Are Making Your Holiday Meals More Expensive," examining how the agribusiness companies that process Americans’ food have increased prices for everyday staple foods and raising questions about why those price increases are necessary, particularly during the holiday season. Some of these companies have a history of engaging in price-fixing, colluding to raise prices, anti-competitive conduct, and touting their ability to raise prices without limit. Seeking answers, Senator Casey sent a letter to the Federal Trade Commission and United States Department of Agriculture requesting that the agencies use all necessary resources to investigate possible unfair pricing practices of major chicken and pork processors in the United States. The Federal Trade Commission, in response, assured Senator Casey that policing potentially anticompetitive conduct in food industries continues to be a top priority for the Commission given the high stakes for American families, farmers, and the Nation’s economy.
In December 2023, Casey released his third report of his greedflation series, “Less Bang for Your Buck: Casey Releases Shrinkflation Report Exposing Big Corporations for Reducing Product Size While Keeping Prices High,” calling out household consumer products, food, and beverage corporations for reducing the size of household consumer goods, from toilet paper to cereals to snacks, while continuing to sell them at the same retail price. To better protect families’ pocketbooks, Senator Casey sent letters to the trade associations representing household consumer products, food, and beverage corporations demanding answers about pricing strategies, package size practices, and how shrinkflation affects customers.
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.
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