"This is the year of the woke corporation, the year the chieftains of the most powerful companies got bored with making money and decided to remake America, principally by telling Americans how bigoted and backward they are.
Major League Baseball shipped the All-Star Game out of Georgia when that state's elected representatives dared enact modest election-integrity measures. Big Tech silenced a sitting president, banned books it didn't like, and threatened to install itself as censor of the nation's speech.
America's founders had a word for this state of affairs: aristocracy. We might call it oligarchy, rule of the wealthy and the few. The founders understood that concentrations of power in either government or the economy are dangerous, threatening the rule of the people. That's why they curbed monopolies and strictly limited the corporate form, largely confining its use to educational institutions and churches and sometimes public-works projects. They wanted the people to govern the nation, not an elite, whether that elite resided in government or business.
It's time America recovered the founders' political economy. We need a new era of trustbusting, an agenda to break up Big Tech and the other concentrations of woke capital that threaten to turn the U.S. into a corporate oligarchy. The aim should be simple: Give working Americans control again over their government and their society. In short, protect our democracy.
We are living in an age of monopoly power. Since the 1990s, two-thirds of American industry has become more concentrated. In 1995 the nation boasted 60 major pharmaceutical companies. By 2015 they had merged to form just 10. Big banks grow bigger while top airlines control ever larger shares of revenue. The credit-card market is now effectively a duopoly, and online it's no better. Google and Facebook control more than 60% of digital advertising.
Big-business consolidation strips Americans of economic opportunity. In today's corporate economy, small and new businesses struggle. New-business formation is barely half what it was in the 1970s, and the pandemic has further privileged the largest players at the expense of local and family enterprises. Concentrations of market power also mean a smaller share of gross domestic product for labor, which leads to flat wages for workers. As the market power of big U.S. corporations has increased, business investment has declined, meaning less spending on innovation and less productivity growth.
Not surprisingly, corporate monopoly leads to political power. It has always been thus. The giant railroads of the 19th century tried to bully and buy entire legislatures, including the U.S. Congress. Today, Major League Baseball -- exempt from antitrust laws -- and a cohort of megacorporations such as Delta and Coca-Cola are trying to order about states on election integrity, while Google, Facebook and Twitter decide which citizens may say what in the public square. Nike lectures the nation on social justice while it is suspected of profiting from forced labor overseas, as the Congressional-Executive Commission on China noted in its March 2020 report. Welcome to the woke economy, led by concentrated woke capital. Do as these companies say or face cancellation.
Americans weren't content to let monopolists run the country a century ago, and we shouldn't be today.
I propose three measures. First, break up Big Tech. The tech companies are the most powerful corporations in the country and likely in American history. They control what Americans read and what they say, what Americans share and what they buy. The Big Tech companies are the railroad monopolies, Standard Oil and the newspaper trust rolled into one, and tech CEOs are our robber barons. Congress should enact new bars on industry consolidation that will prevent the dominant tech platforms from simultaneously controlling separate industries and services. Google, for example, shouldn't be able to own the world's dominant web-search platform and run the cloud. That's too much power and it's bad for competition.
Second, cut the other megacorporations down to size. We can start by banning mergers and acquisitions for corporations larger than $100 billion. No exceptions. There is no good reason for a corporation to buy its way to the size of a small country. Vertical integration, in which one company buys up an entire supply chain -- think Amazon marrying Whole Foods with its Prime shipping network -- should also receive antitrust scrutiny.
Third, give courts a new standard to evaluate anticompetitive conduct. For years, courts have asked whether an alleged monopolist harms consumer welfare. In other words, does the business behavior in question drive up consumer costs? That's a fine question, but trustbusting isn't about consumer prices alone. The tech companies insist that most of their services are free, even as they extract monopoly rents in other ways, like taking private consumer data without consent.
Trustbusting is about promoting robust competition. It's competition that helps workers, spurs innovation and ultimately preserves the power of the ordinary citizen. Our founders understood that competition, not monopoly, is a friend to liberty.
Republicans were once the party of trustbusters. They should be again. The left is increasingly willing to cheer on the new monopolists -- so long as they push the left's agenda on cultural and other issues. In the face of this new alliance between big government and big business, conservatives must recover the wisdom of the founders' vision: liberty, not monopoly. [1]
1. The Big Tech Oligarchy Calls Out for Trustbusters
Hawley, Josh. Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]01 May 2021: A.15.
