Reference no: EM133810212

Assignment:

Need an original discussion point on the below response and what are your views about the action taken by the government under the antitrust laws? Do you agree or disagree with the action? Why?

In 1937, an antitrust case against ALCOA was launched, which accused the company of violating the Sherman Antitrust Act by monopolizing the U.S. aluminum industry. ALCOA, at the time, controlled nearly all of the bauxite market, which is aluminum's raw form that is mined as an ore. ALCOA grew to become vertically integrated across all aspects of aluminum production as well, which ultimately raised concerns of monopolizing. Although ALCOA didn't engage in price-fixing or overtly illegal practices, its dominating control over the supply chain and market was seen as a monopoly, which operated in such that unfairly restricted competition. In 1945, the Second Circuit Court ruled that ALCOA unjust dominance in the aluminum industry, even if achieved through efficient business practices, constituted as a violation of antitrust laws. The ruling set a precedent that market power alone, even without illegal conduct, could be problematic and encourage anti- competition practices. Resulting in the breaking up of ALCOAs control over the industry, this settlement aimed to further allow competitors to more easily enter the market.

I agree with the ruling, as unchecked economic dominance can hinder fair competition practices, which is critical for market innovation and consumer choice. It is this foundation of the antitrust laws that has made sure that no single company can dominate an industry or market sector, allowing our economy to continue to grow healthily and fairly.