The interference reduction capability of antenna arrays and the power control algorithms have been considered separately as means to increase the capacity in wireless communication networks. The minimum variance distortionless response beamformer maximizes the signal-to-interference-and-noise ratio (SINR) when it is employed in the receiver of a wireless link. In a system with omnidirectional antennas, power control algorithms are used to maximize the SINR as well. We consider a system with beamforming capabilities in the receiver, and power control. An iterative algorithm is proposed to jointly update the transmission powers and the beamformer weights so that it converges to the jointly optimal beamforming and transmission power vector. The algorithm is distributed and uses only local interference measurements. In an uplink transmission scenario, it is shown how base assignment can be incorporated in addition to beamforming and power control, such that a globally optimum solution is obtained. The network capacity and the saving in mobile power are evaluated through numerical study.