From the Economist: Across the West powerful firms are becoming even more powerful Excerpt: A wake-up call The view that competition might be in peril extends beyond those travelling from New York to Chicago. It feeds into the public’s sense that the economy is rigged. Pension funds are making huge bets that the likes of Facebook and Hilton can crank out vast profits in perpetuity. Economists worry that powerful firms could distort interest rates; central-bank bosses debated this in August at their gathering at Jackson Hole. In Europe regulators are angry with Silicon Valley. America’s antitrust agencies are waking up from a decades-long slumber, rather like financial regulators after the shock of 2008. Into the vacuum has stepped a radical new antitrust movement that believes the ideal economy is made up of lots of smaller firms with fragmented economic power. It wants to smash concentrations of capital in the name of liberty. But the story is more complex than big business unfairly crushing all before it. Powerful firms are often efficient and pass the gains to consumers; think of Walmart selling mountains of baked beans for peanuts. They are often innovative, too. Netflix is burning cash to entertain 130m binge watchers. Populists often claim that the West has been ravaged by Chinese competition and is full of lazy incumbents, but can both be true? If monopolies are causing prices to rise, why is inflation low? ...Three of America’s four big airlines have spent time in Chapter 11 protection from creditors since 2005, while its three biggest telecoms firms invest $45bn a year. Expedia’s margins are falling. It is hard to prove that big investors collude. Adam Smith, a Scottish economist, attacked the guilds that stifled 18th-century Britain. As America boomed in the 19th century industrial empires were created that trust-busters later broke up. Cartels were instrumental in 20th-century totalitarianism. In 1946 American administrators dissolved Japan’s zaibatsu (large industrial and banking conglomerates), and Germany’s Christian Democrats made competition their first priority in their economic manifesto in 1949. Margaret Thatcher used competition to revive Britain’s economy in the 1980s. In the 1990s the European Union used the single market to prise open stuffy industries. But after 2000 the West became complacent. Globalisation was assumed to guarantee competition. Over-mighty firms were judged to be a risk for corrupt emerging countries like Russia and the Philippines but not the rich world. In fact powerful firms were gaining more clout in the West, for bad and good reasons. The bad reasons involve muffling competition. Some $44trn of takeovers have taken place since 1998, many aimed at creating pricing power or efficiency gains whose benefits are not passed to consumers. It has become fashionable for managers to build “moats”, or barriers to entry. The good reason for more powerful firms is the rise of an innovative elite that is an engine of efficiency. Its members are companies that have mastered digital technologies and enjoy network effects that help them fend off slower competitors, says John Van Reenen of mit. In the tech sector this is clear. In old-fashioned industries, however, particularly regulated ones, digital wizardry is less likely to explain powerful firms’ clout. Whether they were created by cronyism or genius, if extraordinary profits are maintained for many years with no sign of new entrants, it is a clue that competition may not be working. In America and Europe there is a growing body of evidence that this is the case.[/quote] Now look up the word that best characterizes the market-economy in which we live. It is "oligopoly". So, where's the Department of Justice when you (the consumer) need it? Go ask Donald Dork ...
Tax them BIG TIME, cut payroll tax to near nothing and allow the worker to start new businesses to compete. Tax those rich individuals at a super high rate also that will allow the worker to catch up with time. Fixed it ! Regulate the rich, free the poor.... Close the boarder will help too... Trump is actually right about that... Regulate all corps. No corp can grow to a valve above 1XX.XXX.XXX.XXX.XX, no one man can be worth XXXX... If not, in 100 more years .0001% will have 99.97% of the money.
