Excerpt from chapter 39. Oligopolies

Posted: October 15, 2011 in Uncategorized

Sub-chapter: Too Big to Fail

The e-book, ‘The Age of Big Business’, by Burton J. Hendrick (178) presents a great historical view of the establishment of big business in the USA and is very enlightening to read in the context of these chapters.

Our corporate watchdogs have been asleep at their post, having allowed oligopolies to develop – not just in one sector but in all major industries and services. But even governments are virtually powerless in regulating multinational corporations. This is discussed in detail in the next chapter.

Once corporations attain a certain size they become immune to any meaningful prosecution because too much of a nation’s economy is then dependent on their assured survival and wellbeing. They will have become ‘Too Big to Fail’ (179), thereby making governments (us taxpayers) their de-facto guarantors. Now where was that line between capitalism and communism again?

The power of such corporations and the control they wield over their embedding economies can easily overwhelm the democratic voice. That is a serious potential threat to democracy. Almighty non-democratic entities serving the profit goals of their protected proprietors and shareholders can control the economic wellbeing of nations, and there is virtually nothing a government or its people can do about it. This is too much concentrated power.

Governments themselves actually create massive monopolies by privatising and selling off public assets for short-term gain. That is very destabilising for the relevant market sectors. It causes great imbalance when the new monopolistic monsters try to merge into competitive market systems while concurrently trying to meet government privatisation conditions. Governments put sharks into goldfish ponds. It is stupidly hypocritical to have laws against monopolies while creating them at the same time.

When individuals display aggressive, selfish, antisocial behaviour, we have a wide variety of laws that remove them from society and place them in jail. Society cannot function with individuals acting this way, let alone corporations. We must therefore also have an amicable constraint on this unacceptable brutality of big business. The selfish, sociopathic personality must change or be changed.

If we tighten laws too much in this regard, we gradually approach state control and all the problems associated with that. Law lets humanity down miserably in this area – sometimes because the beneficiaries of big business are often the same people making the laws. The human motivator of desire turns into greed in its extreme form, unless it is restrained either by law (which is unlikely) or by goodwill.

We, the public are already encumbered as de-facto guarantors to big business so it might be time to consider introducing a statutory public (non-government) voting share in corporations, proportional to their size and public impact. Working out details for this is would be quite a challenge and falls well outside the scope of this book. But we cannot let any non-democratic entity inhabit a position of power from which they could potentially undermine or even hijack our democracies and economies. Even non-democratic foreign governments are buying evermore controlling shares in such critical corporations and farming operations, to secure their own national interests (181; 182). These frightening developments cannot be left to market forces.

We examine some effective ways to de-brutalise business for the betterment of mankind as we progress. Corporations and oligopolies are still made up of individuals, and each person’s own integrity affects that company and its actions.

BIBLIOGRAPHY

178. Hendrick, Burton J. The Age of Big Business, A Chronicle of the Captains of Industry (e-book). FullBooks.com. [Online] 1919. [Cited: 14 Jun 2010.] http://www.fullbooks.com/The-Age-of-Big-Business1.html.

179. Sorkin, Andrew Ross. Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the FinancialSystem–and Themselves . New York : Penguin, 2011. 978-0143120278.

181. Weekly Times, The. Foreign swoop on Australian farms. The Weekly Times . [Online] 15 Nov 2010. [Cited: 15 Nov 2010.] http://www.weeklytimesnow.com.au/article/2010/11/15/259501_latest-news.html.

182. Mayne, Stephen. Chinese investments in Australian resources. The Mayne Report . [Online] 19 Jul 2010 . [Cited: 27 Mar 2011.] http://www.maynereport.com/articles/2008/05/19-2213-8127.html.

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