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Amazon-Whole Foods deal hurts grocery stores in my district, says Silicon Valley congressman

  • "The main problem is it is going to hurt local grocery stores," Silicon Valley congressman Ro Khanna tells CNBC.
  • Amazon and Whole Foods can "engage in low-cost pricing and it is also going to put pressure on wages," he says.

Amazon's $13.7 billion deal to acquire Whole Foods will cause a few problems in one major district of California, U.S. Rep. Ro Khanna told CNBC on Monday.

"The main problem is it is going to hurt local grocery stores," Khanna, a Democratic congressman whose district includes a large portion of Silicon Valley, said on "Squawk Alley."

Amazon and Whole Foods can "engage in low-cost pricing and it is also going to put pressure on wages," he added.

Rohit 'Ro' Khanna
David Paul Morris | Bloomberg | Getty Images
Rohit 'Ro' Khanna

Khanna spoke after he called for the Justice Department and the Federal Trade Commission to review the impact the deal would have on food prices and wages.

On Monday, Amazon's stock jumped to an all-time intraday high, three days after the company announced its blockbuster agreement to acquire Whole Foods.

Khanna said Wal-Mart's dominance in the grocery space has already had a negative impact on wages and local grocery stores. He said the Amazon-Whole Foods deal will further "aggravate" the situation.

CNBC has reached out to Amazon, Whole Foods and Wal-Mart for comment.

Whole Foods said it has "nothing to add."

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