Sunday, April 17, 2016

Invisible Hand Repurposed To Build A Wall Between Rich And Poor

The number of corporate mergers and acquisitions has been a normal and growing part of our world for quite some time, even though there are recent efforts to slow them down. But what I think people ignore when they start talking about the idea that corporations should be able to grow in this way is its place within capitalist models.

The core principle of the "invisible hand" of capitalism can only be considered if there are a large number of very small players, a condition that is best to keep competition from disappearing. A small number of very large players is a condition that kills competition; it evaporates in favor of an anti-capitalist protectionist mode. Those people who own and run the largest players in the economy are looking to remove competition through acquisitions and mergers, something that removes any hope for any theorized invisible hand to have any role, other than to build a wall between rich and poor.

We've been through this kind of thing before, and we responded with what are known as anti-trust laws. But these laws have been weakened or ignored for many decades now, allowing for the eroding of an economic environment that looks to maintain competition in favor of one that subdues it. The "too big to fail" problem is a symptom of this movement toward larger players.

I think we need to embrace the joint ideas that public-motivated regulation is necessary to stop the concentration of power in the hands of a few rich and powerful people with control over large corporations, and continuous evaluation of the results of our efforts in order to make adjustments that keeps bureaucracy functioning smoothly and motivated to maintain the public good without becoming punitive. We can help fix the first problem by keeping corporations from becoming too big (and breaking up the huge ones that already exist), and the second problem with mandatory voting so everyone has to evaluate and help make decisions about what's going on.

We can build a society that benefits as many as possible, but not if we fail to see how the over-concentration of wealth and power works against almost all of us, and don't reverse the lack of participation in the democratic process.

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