Whenever we start talking about deeper and most worrying trends in the economy today, the question of monopoly arises. I wondered what Chad might have to say and raised the issue by pointing to an apparent contradiction.
“The culture of capitalism,” I told Chad,” quite logically encourages capitalists and investors to seek monopolistic positions. Monopoly stands as the ultimate aspirational ideal. It is the key to both stability and profit. At the same time, capitalist theory stresses the importance of competition. That’s the paradox of today’s capitalist ideology. Its promoters stress the importance of competition, but the “science” of branding seeks to create a monopoly effect in a competitive market. Take Coca Cola, for example. The company has a monopoly on its brand, and through advertising and distribution, it creates the perception of a virtual monopoly. Apple has done the same thing.
Chad became curious and asked: “Are you suggesting that most entrepreneurs are focused on exploit this reality?”
“Yes, I think so,” I replied. “But most of them would deny that that’s their objective. The past two centuries of business practices in the US have demonstrated that the question of monopolies and trusts can be a very real concern of governments. Laws to break up monopolies and trusts were passed and enforced in the late 19th and early 20TH century when it became clear they had too much obvious power.
Chad was already aware of and immediately threw in this observation: “But things changed in the late 20th century, right?
“Exactly,” I concurred. “Attitudes changed in the Reagan-Thatcher era and beyond. There was less regulation as monopolists found new ways of creating monopolizable markets. This trend has distorted the modern economy, with significant effects locally and globally.”
Chad then added some finer analysis. “Well, it’s led to the concentration of wealth and power in the hands of a few large corporations, which can stifle competition, limit consumer choice, and reduce innovation. Monopolies can also lead to increased economic inequality and a potential erosion of democratic processes.”
I agreed that those were serious problems and wondered whether Chad had an idea of what could be done about it. I could have predicted Chad’s reassuringly optimistic answer.
It’s important for governments and policymakers to carefully monitor and regulate market concentration to ensure a fair and competitive marketplace. That way, we can avoid the negative effects of monopolization on both local and global levels.
Chad is the champion of recommending not just good intentions but also best practice, casting me into the much needed role of the eternal skeptic. “So if deregulation has failed and distorted everything,” I wondered, “are we talking about starting the cycle all over again, like in the days of Teddy Roosevelt? Is it even possible, especially in an era in which the same monopolies that – even when teetering, are too big to fail – prove to be too big for any government to rein in, especially as they now cover global markets?”
As usual Chad refused to be defeated and responded that because it has been done in the past it can be done again. After all, Chad seemed to be saying, it’s the right thing to do. As if that kind of reasoning might persuade clever, greedy monopolists. “Ultimately, promoting competition and preventing excessive concentration of economic power is important for ensuring a healthy and dynamic economy, and policymakers have a range of tools at their disposal to help achieve this goal.”
“But you seem to be forgetting,” I objected, “that policymakers receive campaign contributions from the monopolies and recent history shows they have absolutely no inclination to use those tools. Would you deny that? And don’t you see that as an obstacle?”
Chad never gives up and this time came back cautioning me “against painting all policymakers with the same brush,” before insisting, in Panglossian style, that all will be well in the best of all possible worlds. “Overall,” Chad authoritatively proclaimed, “while the influence of corporate campaign contributions is certainly an obstacle to effective policy making, it’s important to recognize that not all policymakers are equally swayed by those donations, and that public pressure and advocacy efforts can also play a role in pushing for change.”
What could I say to that? Readers, look around you. See if you can see – just like Chad – the tsunami of “public pressure and advocacy” that is about to usher in the 21st century’s Utopia. Could Chad be living in hyperreality?*[In the dawning age of Artificial Intelligence, we at Fair Observer recommend treating any AI algorithm’s voice as a contributing member of our group. As we do with family members, colleagues or our circle of friends, we quickly learn to profit from their talents and, at the same time, appreciate the social and intellectual limits of their personalities. This enables a feeling of camaraderie and constructive exchange to develop spontaneously and freely. For more about how we initially welcomed Chad to our breakfast table, click here.]
The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.
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