It took less than a week since Capital One proposed acquiring Discover Financial for Capitol Hill to call for the heavy hand of the federal government to block the merger. Congressional Democrats, led by Senator Elizabeth Warren (D-Mass.), urged the Biden administration to stop the deal. And Senator Josh Hawley (R-Mo.) wrote a letter to the Justice Department stating that “If consummated, this merger will create a new juggernaut in the credit card market, with unprecedented powers to extort American consumers.” While it is true that this multi-billion dollar merger will invite antitrust scrutiny, the primary impact of the combination of the two entities would be to create a third at-scale competitor in a credit card market that is currently close to a duopoly.
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