Rod Grams: “Yesterday a mock hearing for the press was hosted by Congressmen Schumer and Gejdenson, along with Prof. Ronald…”

“Yesterday a mock hearing for the press was hosted by Congressmen Schumer and Gejdenson, along with Prof. Ronald Cotteril, director of the Food Marketing Policy Institute at the University of Connecticut. The topic was price collusion in the cereal market, a charge which has not been proved over the past 20 years. After review of all of the evidence which refutes the collusion theory, I find it difficult to understand why the three continue this curious drama. I would like to present to my colleagues some history on this issue, which began with the dismissal of an antitrust complaint by the Federal Trade Commission after 10 years of tedious and costly examination of the industry by the FTC. Last year Federal Judge Kimba Wood, former nominee for Attorney General during the Clinton administration, rejected an antitrust suit brought by the State of New York to prevent the Post Co. from buying Nabisco Shredded Wheat. Judge Wood indicated at the time that the cereal industry was 'highly competitive.' She indicated that there was no collusion, and no one company was able to control prices in any market segment. She characterized the testimony of the State's star witness, Professor Cotteril, one of the hosts of today's mock hearing, as 'unreliable,' 'flawed,' and 'erroneous.' Last year Congressman Schumer and Gejdenson asked the Justice Department to initiate a criminal investigation into cereal prices.”