WASHINGTON – Today, Senators Sheldon Whitehouse (D-RI), Ruben Gallego (D-AZ), Elizabeth Warren (D-MA), and Cory Booker (D-NJ), and Representative Rosa DeLauro (D-CT) led 31 of their Senate and House colleagues in demanding the Federal Trade Commission (FTC) investigate which large companies are using the Trump Administration’s tariff policies – and the confusion surrounding them – as an excuse to raise prices in excess of actual cost increases, and to prosecute individuals and companies that price gouge American consumers.
“President Trump’s on-again, off-again tariffs build an especially fertile environment for price-gouging. The new tariffs have created a cloud of uncertainty that gives companies cover to raise prices on all goods, regardless of whether they are subject to new tariffs or whether their costs have meaningfully increased, above and beyond what is necessary to cover any cost increases,” the members wrote.
They continue, “While small businesses operating on thin profit margins will be forced to pass on many costs to stay afloat, the chaotic and sweeping nature of President Trump’s tariffs is especially conducive to price gouging by large companies with significant market power […] Even if President Trump decides to reduce or eliminate tariffs, companies may nonetheless decide to maintain higher prices—or raise them even further, claiming ‘market uncertainty.’”
The members note that many large corporations have already admitted to raising prices regardless of the actual impacts of tariffs, such as when the CEO of AutoZone said on an earnings call last September, “if we get tariffs…we generally raise prices ahead of [when] we know what the tariffs will be,” or when, during the first Trump Administration, manufacturers raised the price of dryers, even though only washing machines were subject to tariffs.
To prevent this type of corporate price gouging at the expense of working families, the members urge FTC Chair Ferguson to fulfill his public commitment and to ensure President Trump’s trade war is not a “green light” for price gouging by:
- Using his authority under Section 6(b) of the Federal Trade Commission Act to require large companies to report their costs and retail and wholesale prices since November 6, 2024 and the extent to which tariffs have increased their costs.
- Using his authority under Section 5 of the Federal Trade Commission Act to investigate and prosecute companies engaging in “unfair or deceptive acts or practices in or affecting commerce.”
The members also criticized Chair Ferguson’s decision to abruptly close an FTC investigation into corporations using Americans’ personal information to tailor their pricing and gouge individual consumers. The tactic, known as “surveillance pricing,” is used by corporations to target consumers with increased prices based on their location and browsing history.
“Armed with the knowledge that the FTC has turned a blind eye to this price-gouging tactic, companies now have free rein to use surveillance pricing to price gouge consumers. A former FTC official said, ‘The message that is coming out of this administration…is that the watchdog is gone and companies feel emboldened to rip people off.’ We urge you to fulfill your public commitment and to ensure President Trump’s trade war is not a ‘green light’ for price gouging,” concluded the members.
You can read the full text of the letter, including additional questions posed by the members to Chair Ferguson, HERE.
