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Running for Congress on an Anti-Monopoly Platform
In this episode, Stacy Mitchell, ILSR’s co-director, chats with former Congressional candidate Austin Frerick. During the Obama Administration, Frerick was a young economist at the Treasury Department when he started noticing how consolidated many industries have become. Pouring over the data, he realized that just two companies produce most of our hearing aids, and the same was true for many other goods, from toothpaste to beer.
After Donald Trump took office, Frerick left Treasury and headed back to his home state of Iowa. There, in rural southwest Iowa, he began to notice how concentration was playing out in the real world, not just on a spreadsheet. He saw farmers going into crippling debt because a couple of global giants control the market for corn seed. He saw his mom lose her job at Target because of Amazon’s rising market power. That’s when Frerick decided to do something: At age 28, he launched a campaign for Congress in Iowa’s 3rd Congressional District.
Austin and Stacy talk about: how raising money from affluent coastal cities impedes the Democrat Party’s ability to connect with rural voters; why we all need to make small donations to our favorite candidates; how monopolies are fraying social ties and leaving more Americans isolated an lonely; and more. Tune in to hear it all.
“You have the world’s best farmland yet the poverty is increasing. You have Red Oak, Iowa, which is a town of four or five thousand. Home to Senator Joni Ernst. Two out of three kids there are on free or reduced lunch. It’s boils your blood. This system’s broken. You can get a better locally sourced meal in D.C., New York, L.A. than I can at a diner in Iowa.”
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Transcript
Stacy Mitchell:
Hello and welcome to Building Local Power. I’m Stacy Mitchell of the Institute for Local Self-Reliance. The 2018 midterm elections are just around the corner. Much has been said about how divided Americans are these days, especially along rural and urban lines. And yet, polls show that voters across the spectrum are actually quite aligned when it comes to several core economic issues. Large majorities of voters believe that big corporations have too much power, and that public policy has rigged the system to favor these corporate giants at the expense of whole communities that have been pushed to the margins.
To help us think about these dynamics and how election campaigns that focus on challenging concentrated power might just be the key to fixing our politics, I’ve asked Austin Frerick to join us on the show today.
Austin launched a campaign last year to win the Democratic nomination for Iowa’s 3rd Congressional District. It’s a district that encompasses the city of Des Moines and a large rural swath of southwest Iowa. Austin eventually had to drop out of the race because he spent too much time talking to voters and not enough time fundraising, but before he stepped aside, he built a strong grassroots following and he’d drawn considerable local and national media attention for the anti-monopoly ideas he was talking about on the campaign trail, and the response he was getting from rural voters. Austin is a seventh generation native of Iowa. He’s also an economist and a fellow at the Open Markets Institute. He joins us today from Kansas City where he’s participating in the Annual Conference of the Organization for Competitive Markets.
Austin, welcome to Building Local Power.
Austin Frerick:
Thanks for having me on Stacy.
Stacy Mitchell:
Well, I want to start just by asking you what led you to decide to run for Congress? I mean, that’s a big thing to take on and I’d like to know more about where you come from and what the motivation was.
Austin Frerick:
I was just going to say there’s not too many 28-year-olds running for Congress. I was actually a tax economist at Treasury before I ran for Congress, and I was actually writing an academic paper on monopolies. It was just an exercise essentially to get ready for the next administration. I kept seeing all these huge monopoly profits in these different sectors that you normally don’t see. Honestly, it was food that really caught my eye because pharmaceutical kinds of dealers, you do all this research, you get a patent, you have a monopoly for a few years. Anyone can make a cracker, so why are you seeing these cracker companies having these huge monopoly profits?
So that kind of got me interested in the whole anti-trust and discovering Barry Linn, the folks at Open Markets. But at the same point, a lot of my family voted for Trump. I like to joke when I say I was probably the only person at Treasury to vote for Bernie Sanders in the primaries, because I don’t think people understood. I think there was a misperception in the capital city, just the pain people feel. And so, I had moved back home because after Trump’s election … I was a civil servant. We don’t have any children yet, so I wanted to run for public office because I thought this was an issue no one was talking about.
I was actually looking at a State Senate seat but then a good friend of mine, retired school teacher, decided to run after … He’s really anti-teacher legislation this past session in Iowa. And also, these anti-trust message, a big component of it is federal. It’s kind of one of those things where I want to move home, I love this message, and it was like, “Oh, this is a competitive primary. This is a very competitive seat. The stars kind of aligned” sort of thing. It wasn’t like I woke up one morning, but it all made sense but slowly. It’s also funny to say you launch your congressional campaign based on an academic paper. It’s the nerdiest thing possible. I think it’s kind of funny.
Stacy Mitchell:
But there must have been something too. I mean, when you were doing that research and really seeing this shocking level of consolidation that was happening in different industries, I mean you mentioned food, there must have been an aspect of that that actually really connected back to what you saw growing up in Iowa. I’m wondering if you could talk a little bit about … you know, obviously you didn’t go out and run a campaign talking to people about a paper you’d done on excess corporate profits, but really talking about what that meant in the context of their lives. I’m curious what it was about running across this issue of monopoly that resonated so much with what you had seen in Iowa.
Austin Frerick:
It was the fresh eyes. Living in Iowa, growing up Iowa, going to college in Iowa, going to D.C. for a few years, coming back and then realizing, “Oh wait, that McDonald’s farm, that imagery, doesn’t exist.” There’s no livestock on farms anymore, it’s all in cages. I mean you still see some beef farmers, but not too many. A lot of that land, when corn went up to seven, was put into ethanol. So seeing that and then just seeing the … I think kind of lost in a lot of these conversations where a lot of the great recession was in urban recovery. A lot of rural growth communities are still struggling.
Just seeing you have the world’s best farmland yet the poverty is increasing. You have Red Oak, Iowa which is a town of four or five thousand. Home to senator Joni Ernst. Two out of three kids there are on free or reduced lunch. It’s boils your blood. This system’s broken. You can get a better locally sourced meal in D.C., New York, L.A. than I can at a diner in Iowa.
Stacy Mitchell:
Wow.
Austin Frerick:
My dad’s a trucker and my mom recently lost her job at Target because of these consolidations stuff. And it’s just like, you get it. It’s one thing to see it on an Excel sheet, but when you talk to people you see the anger, you see the pain.
Stacy Mitchell:
There’s an idea in elite policy circles and among economists and the like that you can’t really run on anti-trust or anti-monopoly as a platform because ordinary people don’t really understand that, that it’s sort of far removed. But what I think is interesting about your campaign is that you really turn that idea on its head. Your campaign was really built on the idea that regular voter know a lot more about concentrated power than even the economists do because they’re on the receiving end of those consequences.
So, when you thought about being motivated to run on this issue of monopoly and concentration and as you went out and started talking to voters, how did you choose to frame that? How did you actually talk about that, and what kind of response did you get?
Austin Frerick:
Honestly, it was just practice. I think a lot candidates need more of just telemarketers. They don’t do retail politics, and half of retail politics is just learning. There’s a term they use called code switching, just learning their language. I know when I’m not connecting with you. When I’m standing in front of you … that Fall when I first announced, as my partner can tell and my campaign manager, it was rough. You have to develop that language.
And I never said the word anti-trust, but my whole campaign was anti-trust. The examples I would use to suburban Des Moines audiences is very different than a rural community. And I have to learn that. That’s up to me to learn as a politician how to communicate this to you and how it impacts your life, and that just takes practice. There’s times I’ve failed, and you just get back up. You ask people “How can I do this better?” But because of this current model of campaign, a lot of candidates don’t do that. They just fundraise and they essentially rely on D.C. consultants to do a random poll and tell them how to talk.
Stacy Mitchell:
Talking to farmers in rural Iowa, what were the notes that you hit. If you’re door knocking and the door opens, what are you saying?
Austin Frerick:
Well honestly, the hard part is getting them to open the door. I had a harder time getting people to open the door in rural communities than in urban Iowa. Your house is you everything, it’s your largest asset. The local plant … manufacturing used to be in urban areas, went to rural communities, then went offshore. People have their home and then they have to drive longer to get a job. You work longer hours for less and our food system’s broke so the cheapest food is usually unhealthy. So, you see this kind of hollowing out of civil society in a lot of rural communities. So, people turn inward.
So, the challenge I had honestly was how do I get to you when people are iglooing. How do I get to your message. For them, the message I found resonating was just hey, I was a Democrat talking, just knowing what corn prices are. Understanding what $7.00 corn, $3.00 corn, talking about their pocketbook with feed costs. You can talk about monopoly, when I say that corn feed tripled in price in ten years, and I promise you didn’t triple as good, A, I’m showing respect to your profession. B, I’m validating your anger.
And so it’s that coupled with, especially in rural communities that sense of self-sufficiency and you can’t feed your own kids really connects well. The loneliness, I mean that’s what farm consolidation does. I don’t think humans really grasp it yet. When you had seven farms living on one street and it becomes one or two, it’s lonely.
Stacy Mitchell:
I feel like this is an area that has been so under reported on and under researched really, which is the ways in which consolidation is undermining the social and civic fabric of places. It’s a lot because I study retail a lot, as you know, independent businesses and the difference between having a neighborhood business district that’s thriving if you’re in a city or a nice downtown if you’re in a small town and kind of running your errands where you’re running in to your neighbors and going in to stores where people know you and that kind of thing.
There are a lot of social ties that are built that way and they’re kind of weak social ties in the sense that these are people that are more acquaintances sometimes than lose friends or those are more neighbors than close friends and yet those ties are really valuable. I think there’s a way in which that gets overlooked and it’s happening, as you know, across rural America too.
Austin Frerick:
We live in an age, and this I saw at Treasury that bothered me is we want to over quantify everything. So, there’s a metric, efficiency. The cult of efficiency. You can’t make a metric for human ties, human relations. But, the fact that you know your local, your pharmacist. That kind of stuff. The humanity. Just seeing the humanity in each other and the more holistic civic society. I mean that third space. I mean that’s kind of sad thing you see is like retail essentially, downtown died because it all went to Walmart and the malls well, malls are dying and it’s just where do people go. Where do they go to see each other.
The one thing that gives me hope now is farmer’s markets because that’s kind of filling that void. But no, I totally agree with you. It’s an under-appreciated thing because a lot of those coastal communities, it’s fine. It’s a robust civic society but with the hollowing of local news, you don’t see that. I mean Southwest Iowa, Warren Buffet owns most of the newspapers.
And, I’ve had small town publishers tell me they agree with the Monsanto … I really focused on opposing Bayer-Monsanto’s merger. That’s also one of the largest ad buyers. They’re barely getting by. They’re losing subscribers. They’re losing their advertising base. Why bite the hand that feeds them?
Stacy Mitchell:
Oh, wow, yeah. Yeah, so you really found you felt like newspapers in your region kind of stepped away from covering that more aggressively?
Austin Frerick:
Oh yeah. I mean a lot of the times too, a lot of these papers, they’re not making money or they’re getting by on 10, 12 an hour when you average it out, but it’s a sense of duty. It tends to be older women who are doing it. And, what happens after that? Who’s gonna carry on that sense of dutiness? Where is the small town newspaper in this current model of concentrated media? How do you thrive?
Stacy Mitchell:
Yeah. Yeah, I mean it’s interesting, this idea of that sort of cult of efficiency that we live in and everything needed to be quantified. It’s an interesting thing to hear from someone who worked as an economist because you really understand that on the inside, but it’s very true and it’s especially true in the anti-trust conversation, I mean I feel like part of the reason anti-trust has strayed so far from its original purpose is that it has become this highly kind of technical affair where it’s largely driven by economic analysis.
And so, what counts is what can be measured and things that are harder to measure or can’t be measured aren’t on the table, even though those impacts are exactly what we should be considering in the context of a merger. Say if you merged two companies and it has these downstream effects on all these communities and the health of those places, that really matters. It use to be part of how we though about merger review before it was so quantified before kind of the economists, the cult of economics profession sort of came in and redid how we review mergers to make anything that isn’t really a price effect that can be measured not on the table, not part of the analysis.
Austin Frerick:
Oh, and honestly, it’s just laziness because it’s easy to just send an Excel sheet and say these magical numbers tell me everything. But, I remember this lesson I learned when I was in college, I did my undergrad thesis on slaughterhouse towns in Iowa and the school districts because I was shocked to kind of see that the majority, minority. They’re very diverse and very poor. I was looking in to it and I’m like you can look at the numbers and say “Oh, this school district’s 40 percent Latino.” You go to the town, you talk to the superintendent and he goes, “That’s masking so much.” What’s happening is maybe the seniors are 15 percent Latino, that kindergarten class is maybe 80 percent. I mean just a simple thing where you just talk with a human being, you learn the nuance, and he’ll tell you, “Oh, what happens is usually the men comes first, then the woman, the kids.” It takes a while for these different ethnic groups to show up in education data.
But he’s saying, “Our next thing we are concerned about is we have a lot of Sudanese moving in, so we have to essentially make sure that we have the resources to have Arabic translators.” You don’t see that in the data. I can sit in my little D.C. cubicle, look at my Excel sheet I wouldn’t know that. But, I think part of the cult of efficiency is just laziness.
Stacy Mitchell:
Yeah. Yeah, that’s right. And then I think that sort of brings me to another thing that I wanted to talk with you about, which is you ran as a Democrat, I’m in Maine, which is another out of the way state that is largely rural and I guess my sense is that the Democratic party, for a long time has been sort of out of touch with rural communities, very much to its peril. There are a lot of I think ideas that people have in big coastal cities about rural areas that aren’t true. I mean one of them is this service I’m sure that rural areas are extremely White when in fact there are lots of people of color, lots of gay people living in rural areas. I mean what do you … when you think about this kind of rural challenge for the Democratic party, what do you think about that and what’s your advice for the party?
Austin Frerick:
One of the big things I learned during my campaign was we live in the age of a candidate and not the party. Those institutional money, that Union money, all that’s been hollowed out. I mean that was a systematic assault by Republicans to rob our band. Like in Iowa, our Democrat party, it’s in an old Pizza Hut looking building, a run down building across from the airport. They’re barely getting by. Staffers are barely paid. So essentially what’s happened to kind of fill that void, and you kind of fall with the new Democrats, with Bill Clinton is upper class White professionals now finance the Democrat party. I mean as a candidate, do I go out there and learn my rhetoric, learn how to speak anti … how do I learn how to connect anti-trust, or do I sit and call upper class White professionals in Northwest D.C. or San Francisco? This message doesn’t connect with them.
I got so much pushback for supporting 5 for 15. I think that’s part of the problem is because the financing, they control it and candidates have to devote a disproportion amount of time because Barbara Barrens can drop a ton of money on you and you have to raise a lot of money to go tit for tat. How do you have a voice in that? I mean then you see candidates who break that mold and it gives you hope this cycle.
Stacy Mitchell:
What kind of candidates are you following with this election?
Austin Frerick:
I’m a big fan of getting to the candidates themselves because a lot of times too you have all these different progressive groups. To me, there’s a lot of grasp going on between consultants to try to cash in. I’m really excited by actually quite a few Iowa Statehouse candidates. The two ones in particular is a young woman named Kayla Koether up in Northeast Iowa in Decorah. Her and her partner are ranchers and she … it’s a very competitive seat. I went to college with her and she’s honestly one of the sharpest people I know. I use to talk tax policy with her on agriculture. She knew more than some of the people I knew at Treasury because she’s a sustainable farmer and so have Farm Bureau will go after her big time. She’s one of those people you want to see people like her thrive.
The other one is a woman named Deidre DeJear, and she’s this African-American woman running for Secretary of State. She’s one of those people, you know when you meet someone they’re just like they radiate your life?
Stacy Mitchell:
Uh-huh (affirmative).
Austin Frerick:
She says those words that would come out of a normal politician’s mouth and they sound hollow. When she says “I want to get people engaged. Register to vote”, you know she means it. I’m a little broke after my campaign but I always make sure whatever I can do to help her. Candidates like her is … so $100 really does matter to candidates. It helps them buy yard signs. It helps them pay their staffers.
Just part of what concerns me now is people have nationalized their news intake. They read the New York Times or whatever kind of food public … whatever kind of interest publications. People really are kind of losing touch with what’s going on in their own communities. Local news doesn’t have that money so a lot of people don’t know. So, it’s like finding out, helping those candidates get their message out is so important.
Stacy Mitchell:
Yeah, and it’s interesting what you say about the Democratic party, that the root of their problem is less maybe about the people in the party or even necessarily the leadership as much as it is about where the money is coming from and that that’s the problem we need to focus on if we want the Democratic party to have a different approach to what it’s doing and actually connect to rural voters and connect to a different agenda.
Austin Frerick:
That’s like the beauty of Unions was when they had more money and power, they were essentially a stop gap app for blue collar workers. So now it’s like you tell a good feel good story of upper class White professionals, they rather hear me talk about being a working class gay man and what I’ve overcome versus the average … everyone has been through struggles in life. You sit and talk with them, you see it. They want to know how you’re gonna make their life better. And so it’s flipping that.
Stacy Mitchell:
That’s really interesting. That’s really interesting. You’re listening to Austin Frerick, former Iowa Congressional candidate and fellow at Open Markets Institute. I’m Stacy Mitchell with the Institute for Local Self-Reliance. We’ll be right back after a short break.
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Just turning back to the anti-monopoly approach, there’s this really interesting quote that I saw from you where you said you can try to organize workers at a slaughterhouse all you want but if that company has 60 percent market share, they can just shut it down. I thought that was interesting because it really spoke to the fact that for a long time the focus for people organizing around worker justice has been how do we reinvigorate Unions, how do we raise the minimum wage, and those things are important but you’re really pointing to the fact that concentrated power, if we don’t confront that, this other stuff may not matter.
Austin Frerick:
So Des Moines home to a really good university called Drake University and they’re known for their journalism program. What the saddest thing is you see a lot of these kids come out of it but there’s not that job in local journalism but there’s jobs in corporate communication. And, you’re seeing Tyson, I mean it’s funny to see these companies brand themselves as do-gooders. Having Monsanto talk about how it cares about employee health is pretty comical. But, they understand that they have that kind of money because they have monopoly profits to do this PR campaign.
I think what you saw happen is a tyrant came along, exploited that anger and just instead of blaming Tyson, he blamed the bottom person. There’s validity to the anger a lot of people feel, it’s just these companies have so much resources and they will crush you. I’ve seen it with tons of sustainable agricultural candidates in Iowa. You have them and their cronies at the Farm Bureau will just dump a lot of money on you. A lot of times I’ve seen Democrats who can’t co-op these. You’re incredibly naïve if you think you can take their money and neuter them in a way. Like no, they are gonna … these will only intensify. So, I think it’s just confronting it head on.
Also, it’s like David versus Goliath. I think candidates anymore, why fundraise all the time to buy media, earn media because it’s so much funner than being in a little box calling people all day for money. It’s fun being out there helping being a part of a fight for 15 protests, being part of a final protest. Get to know those communities but make sure you talk about it on social media. Make sure you tell that local newspaper, all that kind of stuff.
Stacy Mitchell:
Although you had to drop out of the race in sort of trying to keep up with the difficulty of trying to keep up with the necessary sort of money, as you look around the country, do you feel hopeful at what you’re seeing in terms of the 2018 election? Do you feel like there are more candidates who are talking about corporate power successfully? I mean what’s your sort of read of where we’re at right now?
Austin Frerick:
Oh, that’s such a … god, I feel it’s like a quarter, you know when you flip it and every day it’s a different feeling? I mean I keep going back to 2014 when Ebola was a thing. I’m so afraid because these guys have so much money. And, they’re usually all White men. Koch brothers, we know all that hedge fund money, they can dump so much money and gin up a controversy where there’s great people running, there’s some cool people talking about corporate power but what will be that October thing?
I mean the scary thing about this moment too is how much of the business community is going to ignore the President’s very … I mean I don’t know what words to use to describe what he says because you can’t even attach that. We talked about this once at Treasury and we all … everyone’s kind of like cowers when you say the word but there’s some dancing around fascist lines really close.
I regret not working as hard for 2016 as I did for prior elections and making sure, as October and November comes, telling everyone, every person you know, like “Make sure you vote.” Here’s what I mean. This is why I care about a candidate. Donating to candidates as almost like donating to causes. The candidates you really think … you really connect with their message, give ’em money. Give ’em your time. Have that be your Saturday activity.
I’m also that we can usually, in the darkest moments of our country, we have these great moments really for … it took that gilded age to make that progressive movement. I hope we can see a second gilded age to get to that second progressive movement. So, we are dancing so close to so many lines right now.
Stacy Mitchell:
It’s a sobering and the hopeful mix together there and I think that’s a very accurate read of where we’re at. How do you … I mean you’ve offered several suggestions for people, you know, do get involved in campaigns, do give money to candidates that you like, even if it’s small dollars, and definitely talk to your friends and neighbors and everyone you know about voting, about also getting involved in campaigns and giving money. Those things seem really incredibly critical right now. What else, even moving past the election, what do you think people should be doing in their communities about the problem of corporate power?
Austin Frerick:
I think a lot of us are thinking about how do we reassert our own power. We have power at our local levels. I could definitely say I’m not even 30, I’m a failed politician but I remember every email I got, every Facebook message, tried to respond to it. I know other candidates do too. Contact them. Your city council member, like let’s say procurement, it’s a nerdy word but it’s so important. Where do you buy your stuff? Where’s the city buy your stuff? You can push ordinances that say don’t buy Amazon, buy local. Or, even your local school district, buy some part of your food locally. Keep that money within your community.
One of my favorite works you guys are doing is that North Dakota pharmacy stuff. I had never heard about it until a few months ago. The fact that, was it pharmacy has to at least be 51 percent owned by a pharmacist?
Stacy Mitchell:
Yeah, that’s right. You can’t open the pharmacies in North Dakota, you can’t open a pharmacy unless you’re a pharmacist. So, it has to be wholly owned by a pharmacist. So, there are no Walmart or Walgreens pharmacies in North Dakota.
Austin Frerick:
What I found funny about that too is there’s a great Consumer Reports study came out earlier this year where they took six of the most popular generic drugs, called 150 different pharmacies, averaged out what was the price at Costco, Walgreens, and CVS, independent. The independent’s were about $100, 107 I think. CVS, Walgreens were like seven, eight hundred.
Stacy Mitchell:
Yeah.
Austin Frerick:
You have that Amazon or all these things are cheaper, they’re not. They then contacted CVS and like “Hey, what’s going on here”, and CVS was like “Oh, but you didn’t get our coupons.” So what Consumer Reports went back and tried to get these coupon rebates and it was so across the board. Some would give you 20 off, some would give you 150, but even with the cheapest coupon, it was still cheaper to buy your independent pharmacy. Not only is that like a great example of just that narrative being wrong but also people forget with local ownership, local pharmacists, these people are invested members of the community. They’re the ones who are gonna buy that ad in the basketball program. They’re the ones that’s gonna help pay for the food pantry because that’s one of those things I didn’t realize about consolidations. You lose that business community, you lose that professional class. That PTA parent. That civic societiness goes away when you lose that community member, that entity. So, I think that’s such an important point.
Stacy Mitchell:
It’s so striking in how many sectors where we’ve done research where we’ve found that small independent businesses offer a lot of value and sometimes lower prices, better outcomes, and yet people don’t see that. I mean the pharmacy example is a really telling one. People just assume that these local pharmacies can’t compete, that they can’t provide good quality service at low cost, and in fact they’re out competing the chains. The reason that they’re disappearing has to do with the market power of CVS health and other sort of PBMs that undermine them.
We just see this in so many sectors. Another one that comes to mind is broadband provision. If you push back against Comcast and Time Warner, I mean one of the things you’ll hear from their supporters is the reason that our broadband prices are so high in the U.S. compared to the rest of the world is that we’re a very largely rural country where everything is really spread out and it costs a lot of money to extend these cables and everything to a more spread out kind of population than say in Europe or elsewhere.
And then, what’s so funny and ridiculous about that is that the lowest broadband prices for in this country are actually in rural areas where there are small co-ops and other providers that have built these high speed fiber networks that are better and cheaper than what Comcast and Time Warner are doing in cities. The reason that those companies are so expensive is because they have a monopoly in most places. That’s what’s really going on.
It’s challenging to … I realize in going out and making these kinds of arguments or pointing to this information that people are … it’s hard for them to see it in a way because we’re so steeped in the ideology that bigger is cheaper, and that yeah, we might be nostalgic about the loss of the local business, maybe they’re these sort of touchy feely reasons why we miss them but a hard-nosed kind of analysis is that they really can’t compete. That ideology is so prevalent that even when you present people with that information it doesn’t always really sink in.
Austin Frerick:
Well, honestly, I probably thought that as soon a year ago. It sounds so simple but like earlier this summer, I was in Mason City, Iowa and I was just puttering around. I like to bring up my drives. I did a drive from Cedar Rapids to Minneapolis and there’s a big Iowa department store chain called Yonkers going out of business so I was looking at their mall. You’re seeing these retail type of units collapse.
I was downtown and I had stumbled upon a men’s store. You don’t see men’s stores anymore. I can probably count on one hand how many are in Iowa. Went in and it was really good customer service, young guy taking over his dad’s business. In my head I was like “Oh, I’m gonna pay way more than anything I would pay at a bigger store. I’m gonna buy a nice pair of socks, that way I can give ’em some business. Feel good about myself.” But, I figured in my head “Oh, I’m paying four or five more dollars.” I went online later to price check. His socks were the same price.
It’s a simple little thing where like in my head I’m thinking I’m paying a price premium, that feel goodness and it’s just not true but it’s so ingrained in us.
Stacy Mitchell:
It reminds me there was a piece someone wrote for Medium last week. We’ll post a link on the show page for this episode because I’m sorry, I’m forgetting the writer, but he was … he’s in D.C. and he was also gonna write a story about how brick and mortar retail is going by the wayside and what we are sort of losing in that process but what’s driving it is that we are getting lower prices and so kind of like a trade off sort of story. Low prices versus lost local retail. He went in to a local hardware store in D.C. called Logan Hardware and he bought a variety of different things and then went and price checked them on Amazon and lo and behold, Amazon’s prices were about 30 percent higher for that basket of goods that he got at the independent Logan Hardware Store.
So, he ended up writing a completely different story, which was he said, “I’ve been shopping at Amazon on the theory that I’m saving money and it turns out I should have been going to this local hardware store all the time.” It’s again, sort of more of that ways in which we have these blinders on that are really about ideology not about actually seeing what’s right in front of us.
Austin Frerick:
That’s the point I always make with Amazon too with people is they’re known for their customer service, sure. It’s a question of power. Do we want one person to have that much power in our country, to have 150 billion dollars and to control the capital city’s newspaper? We’ve never seen before in the history of our country where one company got every city to put forward their best bribe, and they made a dog and pony show out of it and we’re suppose to celebrate that? It’s concerning. I think a lot of people … I talked with someone who actually works in the warehouse and they have little beeper on them. If they don’t move a package or scan a package in a few minutes, something goes beep, beep, and you’re treated like … kind of one of the things I learned with this monopoly message is people don’t feel respected anymore by their employer.
It’s just simple things. But, professional class people, you don’t have a little dinger on you. People screw up. You know, if they’re not feeling good, they might screw around on Buzzfeed for an hour. God, I almost used this term called low-skilled worker. I think that’s one of the most patronizing things in economics. I remember I said that to my mom once. And, my mom use to work at a Starbucks, and it takes a lot of skill to socialize for ten hours, to be on your feet. And, it was just one of those things that came out of my mouth because I was so use to that ecom jargon. You’re like that’s so dehumanizing.
I didn’t mean to go on a rant on that but just the respect of Christmas parties, holiday parties, that sense of … you’re seeing them disappear. You’re seeing that kind of … because a lot of these executives, these consolidated entities don’t even live in the community. They’re not on the same soccer team anymore. They don’t see what it means, what these policies mean for people. I mean you had Quest from Iowa. You had a candy factory close because it was going through a merger ten days before Christmas and fire 250 employees. Why would you do that to a human being, having them lose their job ten days before the holidays? Why not wait until January, February? Where’s that decency?
Stacy Mitchell:
Yeah. That’s really true. I’m glad that there are a growing number of people out there like you who are either running for office or supporting candidates or getting involved in their communities and talking about these issues because I think this is … there’s an encouraging level of activity happening now at the local level and really in all parts of the country around these issues and people are beginning to connect these dots in a really powerful way. And so, I share your sort of sense of on the one hand what we’re facing is very sobering and scary, and on the other hand, it feels like there’s some real cracks in the façade and that people … light is starting to emerge and people are starting to figure out sort of how these things are related and what’s really going on underneath the story that’s been told for a long time.
So, it’s great to have you on the show. I’ve really enjoyed listening to you and hearing more about what you’re talking about in Iowa and what you see as ways to change these things.
Austin Frerick:
Oh, thank you so much. The last thing I would just say to that point is you can win by losing. I think that’s something where people … I mean don’t get me wrong, it’s good to win. You have to have a conversation with yourself like you’re given a platform when you run, what conversations do you want to start? Is this a vanity project or are you trying to put more … because we all keep taking cracks, it’s essentially gonna break. But, if you have one community try to take on the power monopoly and say “We want our own power system”, that entity can just dump a bunch of money on them.
But, if you have ten communities trying to do it, they’re going to start being stretched thin. And once you make a crack in them, we win. We’ve all just got to keep taking those hits. You know, speaking truth’s a power because then you get these moments where someone breaks through and then it’s a different game changer.
Stacy Mitchell:
That’s right. Well, I want to end by asking you a question that we often end the show on which is do you have like a reading or watching recommendation for our listeners? And it can be related to these issues or not.
Austin Frerick:
Don’t judge me too much but I was actually going to say Rupaul’s Drag Race.
Stacy Mitchell:
Oh nice.
Austin Frerick:
It’s such a good feel-good TV. It’s Rupaul, the famous drag queen from the ’90s. He has a show. It’s kind of like America’s Next Top Model where all these people come on and they compete to be I guess the next drag superstar but it’s such a feel-good TV, whereas a lot of this reality TV anymore is just cutthroat. It’s a feel-good one where they’re … it listed an art form that it’s been so degraded in our culture but yet these people have to be funny. They have to seel. They have to perform. They’re countering gender norms. I don’t know, I love coming home after a campaign day and I’m like, “Okay, let me just watch an hour of campy TV.”
Stacy Mitchell:
That’s great, and not to sound too old-fashioned by asking this question but where can people find Rupaul’s Drag Race?
Austin Frerick:
It’s on Netflix sometimes. I usually buy it. I just buy the episodes. I don’t have cable. I want to support that so I’ll pay $20 and buy a season and watch each episode. I think the different platforms will have it. You can buy hard copies of DVDs I believe. There’s ten seasons. I think Season Four is the best but everyone has their own opinion.
Stacy Mitchell:
All right. You heard it here first, Season Four, Rupaul’s Drag Race. Thank you again, Austin. It’s been so great to have you on the show.
Austin Frerick:
Yeah, thank you so much, Stacy. Keep up the good work.
Stacy Mitchell:
Thank you for tuning in to this episode of Building Local Power. You can find links to what we discussed today by going to our website ILSR.org and clicking on the show page for this episode. That’s ILSR.org. While you’re there, you can sign up for one of our newsletters and connect with us on Facebook and Twitter. And once again, please help us out by rating this podcast and sharing it with your friends. This show is produced by Lisa Gonzalez and Hibba Meraay. Our theme music is Funk Interlude by DysfunctionAl.
For the Institute for Local Self-Reliance, I’m Stacy Mitchell. I hope you’ll join us again in two weeks for the next episode of Building Local Power.
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In this episode, Stacy Mitchell, ILSR’s co-director, chats with former Congressional candidate Austin Frerick. During the Obama Administration, Frerick was a young economist at the Treasury Department when he started noticing how consolidated many industries have become. Pouring over the data, he realized that just two companies produce most of our hearing aids, and the same was true for many other goods, from toothpaste to beer.
After Donald Trump took office, Frerick left Treasury and headed back to his home state of Iowa. There, in rural southwest Iowa, he began to notice how concentration was playing out in the real world, not just on a spreadsheet. He saw farmers going into crippling debt because a couple of global giants control the market for corn seed. He saw his mom lose her job at Target because of Amazon’s rising market power. That’s when Frerick decided to do something: At age 28, he launched a campaign for Congress in Iowa’s 3rd Congressional District.
Austin and Stacy talk about: how raising money from affluent coastal cities impedes the Democrat Party’s ability to connect with rural voters; why we all need to make small donations to our favorite candidates; how monopolies are fraying social ties and leaving more Americans isolated an lonely; and more. Tune in to hear it all.
“You have the world’s best farmland yet the poverty is increasing. You have Red Oak, Iowa, which is a town of four or five thousand. Home to Senator Joni Ernst. Two out of three kids there are on free or reduced lunch. It’s boils your blood. This system’s broken. You can get a better locally sourced meal in D.C., New York, L.A. than I can at a diner in Iowa.”
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Transcript
Stacy Mitchell:
Hello and welcome to Building Local Power. I’m Stacy Mitchell of the Institute for Local Self-Reliance. The 2018 midterm elections are just around the corner. Much has been said about how divided Americans are these days, especially along rural and urban lines. And yet, polls show that voters across the spectrum are actually quite aligned when it comes to several core economic issues. Large majorities of voters believe that big corporations have too much power, and that public policy has rigged the system to favor these corporate giants at the expense of whole communities that have been pushed to the margins.
To help us think about these dynamics and how election campaigns that focus on challenging concentrated power might just be the key to fixing our politics, I’ve asked Austin Frerick to join us on the show today.
Austin launched a campaign last year to win the Democratic nomination for Iowa’s 3rd Congressional District. It’s a district that encompasses the city of Des Moines and a large rural swath of southwest Iowa. Austin eventually had to drop out of the race because he spent too much time talking to voters and not enough time fundraising, but before he stepped aside, he built a strong grassroots following and he’d drawn considerable local and national media attention for the anti-monopoly ideas he was talking about on the campaign trail, and the response he was getting from rural voters. Austin is a seventh generation native of Iowa. He’s also an economist and a fellow at the Open Markets Institute. He joins us today from Kansas City where he’s participating in the Annual Conference of the Organization for Competitive Markets.
Austin, welcome to Building Local Power.
Austin Frerick:
Thanks for having me on Stacy.
Stacy Mitchell:
Well, I want to start just by asking you what led you to decide to run for Congress? I mean, that’s a big thing to take on and I’d like to know more about where you come from and what the motivation was.
Austin Frerick:
I was just going to say there’s not too many 28-year-olds running for Congress. I was actually a tax economist at Treasury before I ran for Congress, and I was actually writing an academic paper on monopolies. It was just an exercise essentially to get ready for the next administration. I kept seeing all these huge monopoly profits in these different sectors that you normally don’t see. Honestly, it was food that really caught my eye because pharmaceutical kinds of dealers, you do all this research, you get a patent, you have a monopoly for a few years. Anyone can make a cracker, so why are you seeing these cracker companies having these huge monopoly profits?
So that kind of got me interested in the whole anti-trust and discovering Barry Linn, the folks at Open Markets. But at the same point, a lot of my family voted for Trump. I like to joke when I say I was probably the only person at Treasury to vote for Bernie Sanders in the primaries, because I don’t think people understood. I think there was a misperception in the capital city, just the pain people feel. And so, I had moved back home because after Trump’s election … I was a civil servant. We don’t have any children yet, so I wanted to run for public office because I thought this was an issue no one was talking about.
I was actually looking at a State Senate seat but then a good friend of mine, retired school teacher, decided to run after … He’s really anti-teacher legislation this past session in Iowa. And also, these anti-trust message, a big component of it is federal. It’s kind of one of those things where I want to move home, I love this message, and it was like, “Oh, this is a competitive primary. This is a very competitive seat. The stars kind of aligned” sort of thing. It wasn’t like I woke up one morning, but it all made sense but slowly. It’s also funny to say you launch your congressional campaign based on an academic paper. It’s the nerdiest thing possible. I think it’s kind of funny.
Stacy Mitchell:
But there must have been something too. I mean, when you were doing that research and really seeing this shocking level of consolidation that was happening in different industries, I mean you mentioned food, there must have been an aspect of that that actually really connected back to what you saw growing up in Iowa. I’m wondering if you could talk a little bit about … you know, obviously you didn’t go out and run a campaign talking to people about a paper you’d done on excess corporate profits, but really talking about what that meant in the context of their lives. I’m curious what it was about running across this issue of monopoly that resonated so much with what you had seen in Iowa.
Austin Frerick:
It was the fresh eyes. Living in Iowa, growing up Iowa, going to college in Iowa, going to D.C. for a few years, coming back and then realizing, “Oh wait, that McDonald’s farm, that imagery, doesn’t exist.” There’s no livestock on farms anymore, it’s all in cages. I mean you still see some beef farmers, but not too many. A lot of that land, when corn went up to seven, was put into ethanol. So seeing that and then just seeing the … I think kind of lost in a lot of these conversations where a lot of the great recession was in urban recovery. A lot of rural growth communities are still struggling.
Just seeing you have the world’s best farmland yet the poverty is increasing. You have Red Oak, Iowa which is a town of four or five thousand. Home to senator Joni Ernst. Two out of three kids there are on free or reduced lunch. It’s boils your blood. This system’s broken. You can get a better locally sourced meal in D.C., New York, L.A. than I can at a diner in Iowa.
Stacy Mitchell:
Wow.
Austin Frerick:
My dad’s a trucker and my mom recently lost her job at Target because of these consolidations stuff. And it’s just like, you get it. It’s one thing to see it on an Excel sheet, but when you talk to people you see the anger, you see the pain.
Stacy Mitchell:
There’s an idea in elite policy circles and among economists and the like that you can’t really run on anti-trust or anti-monopoly as a platform because ordinary people don’t really understand that, that it’s sort of far removed. But what I think is interesting about your campaign is that you really turn that idea on its head. Your campaign was really built on the idea that regular voter know a lot more about concentrated power than even the economists do because they’re on the receiving end of those consequences.
So, when you thought about being motivated to run on this issue of monopoly and concentration and as you went out and started talking to voters, how did you choose to frame that? How did you actually talk about that, and what kind of response did you get?
Austin Frerick:
Honestly, it was just practice. I think a lot candidates need more of just telemarketers. They don’t do retail politics, and half of retail politics is just learning. There’s a term they use called code switching, just learning their language. I know when I’m not connecting with you. When I’m standing in front of you … that Fall when I first announced, as my partner can tell and my campaign manager, it was rough. You have to develop that language.
And I never said the word anti-trust, but my whole campaign was anti-trust. The examples I would use to suburban Des Moines audiences is very different than a rural community. And I have to learn that. That’s up to me to learn as a politician how to communicate this to you and how it impacts your life, and that just takes practice. There’s times I’ve failed, and you just get back up. You ask people “How can I do this better?” But because of this current model of campaign, a lot of candidates don’t do that. They just fundraise and they essentially rely on D.C. consultants to do a random poll and tell them how to talk.
Stacy Mitchell:
Talking to farmers in rural Iowa, what were the notes that you hit. If you’re door knocking and the door opens, what are you saying?
Austin Frerick:
Well honestly, the hard part is getting them to open the door. I had a harder time getting people to open the door in rural communities than in urban Iowa. Your house is you everything, it’s your largest asset. The local plant … manufacturing used to be in urban areas, went to rural communities, then went offshore. People have their home and then they have to drive longer to get a job. You work longer hours for less and our food system’s broke so the cheapest food is usually unhealthy. So, you see this kind of hollowing out of civil society in a lot of rural communities. So, people turn inward.
So, the challenge I had honestly was how do I get to you when people are iglooing. How do I get to your message. For them, the message I found resonating was just hey, I was a Democrat talking, just knowing what corn prices are. Understanding what $7.00 corn, $3.00 corn, talking about their pocketbook with feed costs. You can talk about monopoly, when I say that corn feed tripled in price in ten years, and I promise you didn’t triple as good, A, I’m showing respect to your profession. B, I’m validating your anger.
And so it’s that coupled with, especially in rural communities that sense of self-sufficiency and you can’t feed your own kids really connects well. The loneliness, I mean that’s what farm consolidation does. I don’t think humans really grasp it yet. When you had seven farms living on one street and it becomes one or two, it’s lonely.
Stacy Mitchell:
I feel like this is an area that has been so under reported on and under researched really, which is the ways in which consolidation is undermining the social and civic fabric of places. It’s a lot because I study retail a lot, as you know, independent businesses and the difference between having a neighborhood business district that’s thriving if you’re in a city or a nice downtown if you’re in a small town and kind of running your errands where you’re running in to your neighbors and going in to stores where people know you and that kind of thing.
There are a lot of social ties that are built that way and they’re kind of weak social ties in the sense that these are people that are more acquaintances sometimes than lose friends or those are more neighbors than close friends and yet those ties are really valuable. I think there’s a way in which that gets overlooked and it’s happening, as you know, across rural America too.
Austin Frerick:
We live in an age, and this I saw at Treasury that bothered me is we want to over quantify everything. So, there’s a metric, efficiency. The cult of efficiency. You can’t make a metric for human ties, human relations. But, the fact that you know your local, your pharmacist. That kind of stuff. The humanity. Just seeing the humanity in each other and the more holistic civic society. I mean that third space. I mean that’s kind of sad thing you see is like retail essentially, downtown died because it all went to Walmart and the malls well, malls are dying and it’s just where do people go. Where do they go to see each other.
The one thing that gives me hope now is farmer’s markets because that’s kind of filling that void. But no, I totally agree with you. It’s an under-appreciated thing because a lot of those coastal communities, it’s fine. It’s a robust civic society but with the hollowing of local news, you don’t see that. I mean Southwest Iowa, Warren Buffet owns most of the newspapers.
And, I’ve had small town publishers tell me they agree with the Monsanto … I really focused on opposing Bayer-Monsanto’s merger. That’s also one of the largest ad buyers. They’re barely getting by. They’re losing subscribers. They’re losing their advertising base. Why bite the hand that feeds them?
Stacy Mitchell:
Oh, wow, yeah. Yeah, so you really found you felt like newspapers in your region kind of stepped away from covering that more aggressively?
Austin Frerick:
Oh yeah. I mean a lot of the times too, a lot of these papers, they’re not making money or they’re getting by on 10, 12 an hour when you average it out, but it’s a sense of duty. It tends to be older women who are doing it. And, what happens after that? Who’s gonna carry on that sense of dutiness? Where is the small town newspaper in this current model of concentrated media? How do you thrive?
Stacy Mitchell:
Yeah. Yeah, I mean it’s interesting, this idea of that sort of cult of efficiency that we live in and everything needed to be quantified. It’s an interesting thing to hear from someone who worked as an economist because you really understand that on the inside, but it’s very true and it’s especially true in the anti-trust conversation, I mean I feel like part of the reason anti-trust has strayed so far from its original purpose is that it has become this highly kind of technical affair where it’s largely driven by economic analysis.
And so, what counts is what can be measured and things that are harder to measure or can’t be measured aren’t on the table, even though those impacts are exactly what we should be considering in the context of a merger. Say if you merged two companies and it has these downstream effects on all these communities and the health of those places, that really matters. It use to be part of how we though about merger review before it was so quantified before kind of the economists, the cult of economics profession sort of came in and redid how we review mergers to make anything that isn’t really a price effect that can be measured not on the table, not part of the analysis.
Austin Frerick:
Oh, and honestly, it’s just laziness because it’s easy to just send an Excel sheet and say these magical numbers tell me everything. But, I remember this lesson I learned when I was in college, I did my undergrad thesis on slaughterhouse towns in Iowa and the school districts because I was shocked to kind of see that the majority, minority. They’re very diverse and very poor. I was looking in to it and I’m like you can look at the numbers and say “Oh, this school district’s 40 percent Latino.” You go to the town, you talk to the superintendent and he goes, “That’s masking so much.” What’s happening is maybe the seniors are 15 percent Latino, that kindergarten class is maybe 80 percent. I mean just a simple thing where you just talk with a human being, you learn the nuance, and he’ll tell you, “Oh, what happens is usually the men comes first, then the woman, the kids.” It takes a while for these different ethnic groups to show up in education data.
But he’s saying, “Our next thing we are concerned about is we have a lot of Sudanese moving in, so we have to essentially make sure that we have the resources to have Arabic translators.” You don’t see that in the data. I can sit in my little D.C. cubicle, look at my Excel sheet I wouldn’t know that. But, I think part of the cult of efficiency is just laziness.
Stacy Mitchell:
Yeah. Yeah, that’s right. And then I think that sort of brings me to another thing that I wanted to talk with you about, which is you ran as a Democrat, I’m in Maine, which is another out of the way state that is largely rural and I guess my sense is that the Democratic party, for a long time has been sort of out of touch with rural communities, very much to its peril. There are a lot of I think ideas that people have in big coastal cities about rural areas that aren’t true. I mean one of them is this service I’m sure that rural areas are extremely White when in fact there are lots of people of color, lots of gay people living in rural areas. I mean what do you … when you think about this kind of rural challenge for the Democratic party, what do you think about that and what’s your advice for the party?
Austin Frerick:
One of the big things I learned during my campaign was we live in the age of a candidate and not the party. Those institutional money, that Union money, all that’s been hollowed out. I mean that was a systematic assault by Republicans to rob our band. Like in Iowa, our Democrat party, it’s in an old Pizza Hut looking building, a run down building across from the airport. They’re barely getting by. Staffers are barely paid. So essentially what’s happened to kind of fill that void, and you kind of fall with the new Democrats, with Bill Clinton is upper class White professionals now finance the Democrat party. I mean as a candidate, do I go out there and learn my rhetoric, learn how to speak anti … how do I learn how to connect anti-trust, or do I sit and call upper class White professionals in Northwest D.C. or San Francisco? This message doesn’t connect with them.
I got so much pushback for supporting 5 for 15. I think that’s part of the problem is because the financing, they control it and candidates have to devote a disproportion amount of time because Barbara Barrens can drop a ton of money on you and you have to raise a lot of money to go tit for tat. How do you have a voice in that? I mean then you see candidates who break that mold and it gives you hope this cycle.
Stacy Mitchell:
What kind of candidates are you following with this election?
Austin Frerick:
I’m a big fan of getting to the candidates themselves because a lot of times too you have all these different progressive groups. To me, there’s a lot of grasp going on between consultants to try to cash in. I’m really excited by actually quite a few Iowa Statehouse candidates. The two ones in particular is a young woman named Kayla Koether up in Northeast Iowa in Decorah. Her and her partner are ranchers and she … it’s a very competitive seat. I went to college with her and she’s honestly one of the sharpest people I know. I use to talk tax policy with her on agriculture. She knew more than some of the people I knew at Treasury because she’s a sustainable farmer and so have Farm Bureau will go after her big time. She’s one of those people you want to see people like her thrive.
The other one is a woman named Deidre DeJear, and she’s this African-American woman running for Secretary of State. She’s one of those people, you know when you meet someone they’re just like they radiate your life?
Stacy Mitchell:
Uh-huh (affirmative).
Austin Frerick:
She says those words that would come out of a normal politician’s mouth and they sound hollow. When she says “I want to get people engaged. Register to vote”, you know she means it. I’m a little broke after my campaign but I always make sure whatever I can do to help her. Candidates like her is … so $100 really does matter to candidates. It helps them buy yard signs. It helps them pay their staffers.
Just part of what concerns me now is people have nationalized their news intake. They read the New York Times or whatever kind of food public … whatever kind of interest publications. People really are kind of losing touch with what’s going on in their own communities. Local news doesn’t have that money so a lot of people don’t know. So, it’s like finding out, helping those candidates get their message out is so important.
Stacy Mitchell:
Yeah, and it’s interesting what you say about the Democratic party, that the root of their problem is less maybe about the people in the party or even necessarily the leadership as much as it is about where the money is coming from and that that’s the problem we need to focus on if we want the Democratic party to have a different approach to what it’s doing and actually connect to rural voters and connect to a different agenda.
Austin Frerick:
That’s like the beauty of Unions was when they had more money and power, they were essentially a stop gap app for blue collar workers. So now it’s like you tell a good feel good story of upper class White professionals, they rather hear me talk about being a working class gay man and what I’ve overcome versus the average … everyone has been through struggles in life. You sit and talk with them, you see it. They want to know how you’re gonna make their life better. And so it’s flipping that.
Stacy Mitchell:
That’s really interesting. That’s really interesting. You’re listening to Austin Frerick, former Iowa Congressional candidate and fellow at Open Markets Institute. I’m Stacy Mitchell with the Institute for Local Self-Reliance. We’ll be right back after a short break.
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Just turning back to the anti-monopoly approach, there’s this really interesting quote that I saw from you where you said you can try to organize workers at a slaughterhouse all you want but if that company has 60 percent market share, they can just shut it down. I thought that was interesting because it really spoke to the fact that for a long time the focus for people organizing around worker justice has been how do we reinvigorate Unions, how do we raise the minimum wage, and those things are important but you’re really pointing to the fact that concentrated power, if we don’t confront that, this other stuff may not matter.
Austin Frerick:
So Des Moines home to a really good university called Drake University and they’re known for their journalism program. What the saddest thing is you see a lot of these kids come out of it but there’s not that job in local journalism but there’s jobs in corporate communication. And, you’re seeing Tyson, I mean it’s funny to see these companies brand themselves as do-gooders. Having Monsanto talk about how it cares about employee health is pretty comical. But, they understand that they have that kind of money because they have monopoly profits to do this PR campaign.
I think what you saw happen is a tyrant came along, exploited that anger and just instead of blaming Tyson, he blamed the bottom person. There’s validity to the anger a lot of people feel, it’s just these companies have so much resources and they will crush you. I’ve seen it with tons of sustainable agricultural candidates in Iowa. You have them and their cronies at the Farm Bureau will just dump a lot of money on you. A lot of times I’ve seen Democrats who can’t co-op these. You’re incredibly naïve if you think you can take their money and neuter them in a way. Like no, they are gonna … these will only intensify. So, I think it’s just confronting it head on.
Also, it’s like David versus Goliath. I think candidates anymore, why fundraise all the time to buy media, earn media because it’s so much funner than being in a little box calling people all day for money. It’s fun being out there helping being a part of a fight for 15 protests, being part of a final protest. Get to know those communities but make sure you talk about it on social media. Make sure you tell that local newspaper, all that kind of stuff.
Stacy Mitchell:
Although you had to drop out of the race in sort of trying to keep up with the difficulty of trying to keep up with the necessary sort of money, as you look around the country, do you feel hopeful at what you’re seeing in terms of the 2018 election? Do you feel like there are more candidates who are talking about corporate power successfully? I mean what’s your sort of read of where we’re at right now?
Austin Frerick:
Oh, that’s such a … god, I feel it’s like a quarter, you know when you flip it and every day it’s a different feeling? I mean I keep going back to 2014 when Ebola was a thing. I’m so afraid because these guys have so much money. And, they’re usually all White men. Koch brothers, we know all that hedge fund money, they can dump so much money and gin up a controversy where there’s great people running, there’s some cool people talking about corporate power but what will be that October thing?
I mean the scary thing about this moment too is how much of the business community is going to ignore the President’s very … I mean I don’t know what words to use to describe what he says because you can’t even attach that. We talked about this once at Treasury and we all … everyone’s kind of like cowers when you say the word but there’s some dancing around fascist lines really close.
I regret not working as hard for 2016 as I did for prior elections and making sure, as October and November comes, telling everyone, every person you know, like “Make sure you vote.” Here’s what I mean. This is why I care about a candidate. Donating to candidates as almost like donating to causes. The candidates you really think … you really connect with their message, give ’em money. Give ’em your time. Have that be your Saturday activity.
I’m also that we can usually, in the darkest moments of our country, we have these great moments really for … it took that gilded age to make that progressive movement. I hope we can see a second gilded age to get to that second progressive movement. So, we are dancing so close to so many lines right now.
Stacy Mitchell:
It’s a sobering and the hopeful mix together there and I think that’s a very accurate read of where we’re at. How do you … I mean you’ve offered several suggestions for people, you know, do get involved in campaigns, do give money to candidates that you like, even if it’s small dollars, and definitely talk to your friends and neighbors and everyone you know about voting, about also getting involved in campaigns and giving money. Those things seem really incredibly critical right now. What else, even moving past the election, what do you think people should be doing in their communities about the problem of corporate power?
Austin Frerick:
I think a lot of us are thinking about how do we reassert our own power. We have power at our local levels. I could definitely say I’m not even 30, I’m a failed politician but I remember every email I got, every Facebook message, tried to respond to it. I know other candidates do too. Contact them. Your city council member, like let’s say procurement, it’s a nerdy word but it’s so important. Where do you buy your stuff? Where’s the city buy your stuff? You can push ordinances that say don’t buy Amazon, buy local. Or, even your local school district, buy some part of your food locally. Keep that money within your community.
One of my favorite works you guys are doing is that North Dakota pharmacy stuff. I had never heard about it until a few months ago. The fact that, was it pharmacy has to at least be 51 percent owned by a pharmacist?
Stacy Mitchell:
Yeah, that’s right. You can’t open the pharmacies in North Dakota, you can’t open a pharmacy unless you’re a pharmacist. So, it has to be wholly owned by a pharmacist. So, there are no Walmart or Walgreens pharmacies in North Dakota.
Austin Frerick:
What I found funny about that too is there’s a great Consumer Reports study came out earlier this year where they took six of the most popular generic drugs, called 150 different pharmacies, averaged out what was the price at Costco, Walgreens, and CVS, independent. The independent’s were about $100, 107 I think. CVS, Walgreens were like seven, eight hundred.
Stacy Mitchell:
Yeah.
Austin Frerick:
You have that Amazon or all these things are cheaper, they’re not. They then contacted CVS and like “Hey, what’s going on here”, and CVS was like “Oh, but you didn’t get our coupons.” So what Consumer Reports went back and tried to get these coupon rebates and it was so across the board. Some would give you 20 off, some would give you 150, but even with the cheapest coupon, it was still cheaper to buy your independent pharmacy. Not only is that like a great example of just that narrative being wrong but also people forget with local ownership, local pharmacists, these people are invested members of the community. They’re the ones who are gonna buy that ad in the basketball program. They’re the ones that’s gonna help pay for the food pantry because that’s one of those things I didn’t realize about consolidations. You lose that business community, you lose that professional class. That PTA parent. That civic societiness goes away when you lose that community member, that entity. So, I think that’s such an important point.
Stacy Mitchell:
It’s so striking in how many sectors where we’ve done research where we’ve found that small independent businesses offer a lot of value and sometimes lower prices, better outcomes, and yet people don’t see that. I mean the pharmacy example is a really telling one. People just assume that these local pharmacies can’t compete, that they can’t provide good quality service at low cost, and in fact they’re out competing the chains. The reason that they’re disappearing has to do with the market power of CVS health and other sort of PBMs that undermine them.
We just see this in so many sectors. Another one that comes to mind is broadband provision. If you push back against Comcast and Time Warner, I mean one of the things you’ll hear from their supporters is the reason that our broadband prices are so high in the U.S. compared to the rest of the world is that we’re a very largely rural country where everything is really spread out and it costs a lot of money to extend these cables and everything to a more spread out kind of population than say in Europe or elsewhere.
And then, what’s so funny and ridiculous about that is that the lowest broadband prices for in this country are actually in rural areas where there are small co-ops and other providers that have built these high speed fiber networks that are better and cheaper than what Comcast and Time Warner are doing in cities. The reason that those companies are so expensive is because they have a monopoly in most places. That’s what’s really going on.
It’s challenging to … I realize in going out and making these kinds of arguments or pointing to this information that people are … it’s hard for them to see it in a way because we’re so steeped in the ideology that bigger is cheaper, and that yeah, we might be nostalgic about the loss of the local business, maybe they’re these sort of touchy feely reasons why we miss them but a hard-nosed kind of analysis is that they really can’t compete. That ideology is so prevalent that even when you present people with that information it doesn’t always really sink in.
Austin Frerick:
Well, honestly, I probably thought that as soon a year ago. It sounds so simple but like earlier this summer, I was in Mason City, Iowa and I was just puttering around. I like to bring up my drives. I did a drive from Cedar Rapids to Minneapolis and there’s a big Iowa department store chain called Yonkers going out of business so I was looking at their mall. You’re seeing these retail type of units collapse.
I was downtown and I had stumbled upon a men’s store. You don’t see men’s stores anymore. I can probably count on one hand how many are in Iowa. Went in and it was really good customer service, young guy taking over his dad’s business. In my head I was like “Oh, I’m gonna pay way more than anything I would pay at a bigger store. I’m gonna buy a nice pair of socks, that way I can give ’em some business. Feel good about myself.” But, I figured in my head “Oh, I’m paying four or five more dollars.” I went online later to price check. His socks were the same price.
It’s a simple little thing where like in my head I’m thinking I’m paying a price premium, that feel goodness and it’s just not true but it’s so ingrained in us.
Stacy Mitchell:
It reminds me there was a piece someone wrote for Medium last week. We’ll post a link on the show page for this episode because I’m sorry, I’m forgetting the writer, but he was … he’s in D.C. and he was also gonna write a story about how brick and mortar retail is going by the wayside and what we are sort of losing in that process but what’s driving it is that we are getting lower prices and so kind of like a trade off sort of story. Low prices versus lost local retail. He went in to a local hardware store in D.C. called Logan Hardware and he bought a variety of different things and then went and price checked them on Amazon and lo and behold, Amazon’s prices were about 30 percent higher for that basket of goods that he got at the independent Logan Hardware Store.
So, he ended up writing a completely different story, which was he said, “I’ve been shopping at Amazon on the theory that I’m saving money and it turns out I should have been going to this local hardware store all the time.” It’s again, sort of more of that ways in which we have these blinders on that are really about ideology not about actually seeing what’s right in front of us.
Austin Frerick:
That’s the point I always make with Amazon too with people is they’re known for their customer service, sure. It’s a question of power. Do we want one person to have that much power in our country, to have 150 billion dollars and to control the capital city’s newspaper? We’ve never seen before in the history of our country where one company got every city to put forward their best bribe, and they made a dog and pony show out of it and we’re suppose to celebrate that? It’s concerning. I think a lot of people … I talked with someone who actually works in the warehouse and they have little beeper on them. If they don’t move a package or scan a package in a few minutes, something goes beep, beep, and you’re treated like … kind of one of the things I learned with this monopoly message is people don’t feel respected anymore by their employer.
It’s just simple things. But, professional class people, you don’t have a little dinger on you. People screw up. You know, if they’re not feeling good, they might screw around on Buzzfeed for an hour. God, I almost used this term called low-skilled worker. I think that’s one of the most patronizing things in economics. I remember I said that to my mom once. And, my mom use to work at a Starbucks, and it takes a lot of skill to socialize for ten hours, to be on your feet. And, it was just one of those things that came out of my mouth because I was so use to that ecom jargon. You’re like that’s so dehumanizing.
I didn’t mean to go on a rant on that but just the respect of Christmas parties, holiday parties, that sense of … you’re seeing them disappear. You’re seeing that kind of … because a lot of these executives, these consolidated entities don’t even live in the community. They’re not on the same soccer team anymore. They don’t see what it means, what these policies mean for people. I mean you had Quest from Iowa. You had a candy factory close because it was going through a merger ten days before Christmas and fire 250 employees. Why would you do that to a human being, having them lose their job ten days before the holidays? Why not wait until January, February? Where’s that decency?
Stacy Mitchell:
Yeah. That’s really true. I’m glad that there are a growing number of people out there like you who are either running for office or supporting candidates or getting involved in their communities and talking about these issues because I think this is … there’s an encouraging level of activity happening now at the local level and really in all parts of the country around these issues and people are beginning to connect these dots in a really powerful way. And so, I share your sort of sense of on the one hand what we’re facing is very sobering and scary, and on the other hand, it feels like there’s some real cracks in the façade and that people … light is starting to emerge and people are starting to figure out sort of how these things are related and what’s really going on underneath the story that’s been told for a long time.
So, it’s great to have you on the show. I’ve really enjoyed listening to you and hearing more about what you’re talking about in Iowa and what you see as ways to change these things.
Austin Frerick:
Oh, thank you so much. The last thing I would just say to that point is you can win by losing. I think that’s something where people … I mean don’t get me wrong, it’s good to win. You have to have a conversation with yourself like you’re given a platform when you run, what conversations do you want to start? Is this a vanity project or are you trying to put more … because we all keep taking cracks, it’s essentially gonna break. But, if you have one community try to take on the power monopoly and say “We want our own power system”, that entity can just dump a bunch of money on them.
But, if you have ten communities trying to do it, they’re going to start being stretched thin. And once you make a crack in them, we win. We’ve all just got to keep taking those hits. You know, speaking truth’s a power because then you get these moments where someone breaks through and then it’s a different game changer.
Stacy Mitchell:
That’s right. Well, I want to end by asking you a question that we often end the show on which is do you have like a reading or watching recommendation for our listeners? And it can be related to these issues or not.
Austin Frerick:
Don’t judge me too much but I was actually going to say Rupaul’s Drag Race.
Stacy Mitchell:
Oh nice.
Austin Frerick:
It’s such a good feel-good TV. It’s Rupaul, the famous drag queen from the ’90s. He has a show. It’s kind of like America’s Next Top Model where all these people come on and they compete to be I guess the next drag superstar but it’s such a feel-good TV, whereas a lot of this reality TV anymore is just cutthroat. It’s a feel-good one where they’re … it listed an art form that it’s been so degraded in our culture but yet these people have to be funny. They have to seel. They have to perform. They’re countering gender norms. I don’t know, I love coming home after a campaign day and I’m like, “Okay, let me just watch an hour of campy TV.”
Stacy Mitchell:
That’s great, and not to sound too old-fashioned by asking this question but where can people find Rupaul’s Drag Race?
Austin Frerick:
It’s on Netflix sometimes. I usually buy it. I just buy the episodes. I don’t have cable. I want to support that so I’ll pay $20 and buy a season and watch each episode. I think the different platforms will have it. You can buy hard copies of DVDs I believe. There’s ten seasons. I think Season Four is the best but everyone has their own opinion.
Stacy Mitchell:
All right. You heard it here first, Season Four, Rupaul’s Drag Race. Thank you again, Austin. It’s been so great to have you on the show.
Austin Frerick:
Yeah, thank you so much, Stacy. Keep up the good work.
Stacy Mitchell:
Thank you for tuning in to this episode of Building Local Power. You can find links to what we discussed today by going to our website ILSR.org and clicking on the show page for this episode. That’s ILSR.org. While you’re there, you can sign up for one of our newsletters and connect with us on Facebook and Twitter. And once again, please help us out by rating this podcast and sharing it with your friends. This show is produced by Lisa Gonzalez and Hibba Meraay. Our theme music is Funk Interlude by DysfunctionAl.
For the Institute for Local Self-Reliance, I’m Stacy Mitchell. I hope you’ll join us again in two weeks for the next episode of Building Local Power.
Like this episode? Please help us reach a wider audience by rating Building Local Power on iTunes or wherever you find your podcasts. And please become a subscriber! If you missed our previous episodes make sure to bookmark our Building Local Power Podcast Homepage.
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Photo Credit: Rural Iowa via Max Pixel
Audio Credit: Funk Interlude by Dysfunction_AL Ft: Fourstones – Scomber (Bonus Track). Copyright 2016 Licensed under a Creative Commons Attribution Noncommercial (3.0) license.
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