Biden Hails Judge's Decision To Block Spirit, JetBlue Merger: 'Capitalism Without Competition Isn't Capitalism'

President Joe Biden has lauded a federal judge’s decision to block the proposed merger of Spirit Airlines Inc. SAVE and JetBlue Airways Corporation JBLU, asserting that it is a triumph for consumers.

What Happened: Biden, in a statement on Tuesday, praised the ruling by U.S. District Judge William Young to thwart the merger, reported The Hill. The President emphasized that the decision is a win for consumers who seek lower prices and more options.

“Capitalism without competition isn't capitalism – it's exploitation,” said Biden, according to the report.

"Today's ruling is a victory for consumers everywhere who want lower prices and more choices. My Administration will continue to fight to protect consumers and enforce our antitrust laws."

JetBlue had proposed a $3.8 billion acquisition of Spirit, which would have made it the fifth-largest airline in the U.S. However, Judge Young found that the merger would significantly reduce competition, contravening the Clayton Act, which aims to prevent anti-competitive practices.

Biden, who has made promoting competition a cornerstone of his economic plan, has often stated that capitalism without competition is exploitation. The decision to block the merger is seen as a significant victory for the Justice Department, which had filed a lawsuit to prevent the deal from going through.

See Also: Passengers Hit Boeing With Lawsuit: Ill-Fated Alaska Airlines Flight Was ‘Waking Nightmare’

Why It Matters: The decision to block the merger is a major development in the U.S. airline industry. As per a Benzinga report, the Justice Department had vigorously opposed the deal, arguing that it would raise airfare costs and reduce flight availability. The court’s decision has led to a significant drop in Spirit Airlines’ shares.

Back in March 2023, the Justice Department had sued to block the $3.8 billion deal, citing concerns about reduced competition and increased ticket prices. The recent court ruling to halt the merger aligns with the Biden administration’s focus on promoting competition to address economic challenges such as inflation.

Price Action: On Tuesday, JetBlue shares closed 4.9% higher at $5.13 in the regular session and were largely unchanged in the after-hours trading. On the same day, Spirit shares fell sharply by 47.09% to $7.92 in regular trading and declined another 4% to $7.60 in the after-hours session, according to data from Benzinga Pro.

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