There’s not much that both Adam Smith and Karl Marx agreed upon, but both discuss the tendency of capitalism toward monopoly. They’re not the only ones of course. Here’s a series of graphic representations of the current trends.
First the Banking industry;
The nation’s 10 largest financial institutions hold 54 percent of our total financial assets; in 1990, they held 20 percent. What could possibly go wrong?
Now food and other common goods;
Next, a big one. Information and Communication.
None of this has anything to do with the maniacal opposition to all those horrible socialist gummint regulations of course; you know, the ones that are being rolled back at every opportunity.
Regulations that did not, as it happens, emerge as a result of bored civil servants just looking for something to do (to hear some GOP rhetoric nowadays, that’s what you’d think), but as a result of previous problems with monopolies arising during the 40 plus years after the Civil War when the Federal Government did just about nothing but maintain the Army and deliver the mail. No SEC, no FDA, no OHSA, no EPA, no FCC, no nothing. Yes, that’s right, the Good Old Days.
Result? Monopolistic headlocks on industries vital to free commerce, thus resulting in anything but free commerce. You’re a farmer wanting to get your perishable produce to market? Great, use the railways. Only problem is you have to pay the freight rates that magically go through the roof, coincidentally, just about harvest time. Pay up, sucker, or let your fruit rot on the loading dock, after all, in a free country choice is what it’s all about.
I bring this up because a little while ago I had dinner with some old friends over in the North Fork—one guy is in his eighties now and was talking about how his grandfather, as a hardworking fruitgrower, was driven into penury by exactly that situation. Lost everything including his orchards and house, which were purchased by a railroad executive from the bank that repossessed them.
The Sherman Antitrust Act, passed in 1890, declared that no person or business could monopolize trade or could combine or conspire with someone else to restrict trade. In the early 1900s, the government used the act to break up John D. Rockefeller’s Standard Oil Company and several other large firms that were rigging the game simply because they could.
The government has been playing whack-a-mole ever since. Monopolies are above all profitable— there’s a powerful monetary incentive to lock up a corner of the market in anything. When it comes to news media though, it’s not just profitable but also a powerful means to control public opinion. It’s not by chance that would-be authoritarians move as early as possible to control the press. Neither is it chance that we are seeing one attempt after another (it’s CISPA this time) to throw control mechanisms over the internet. They are all flying false flags of course—copyright protection, piracy, hacking, “security” and so on.
Internet freedom was praised to the heavens when it facilitated the “Arab Spring”. Lets see what the verdict is when it plays a role in a “European Spring”, or even an “American Spring”. Because if they keep pushing this austerity thing, which the way they’re doing it is really just a way of sluicing money out of the public and into the private sector, the shit really will hit the fan.
This may be a “right-of-center’ country so far as where the center used to be 50 years ago or so, but the crazies who have colonized the GOP since then have now dragged the center so far to the right that folks like that old farmer don’t even recognize their own party anymore. He said that very thing, and this is a guy who has never voted democrat in his life I’d bet, just like most all of the second and third generation farmers and ranchers around here.
I doubt he’ll vote democrat this time either, to be honest, but there’s the smell of a turning tide in the air. That Randian/Norquist absolutism is a bridge too far for a lot of people who have no problem thinking of themselves as conservative.
Oh, and that farmer lives in a County that has not had a democrat in local office since god knows when, and it also has a County Hospital, funded by a mill levy on property taxes, that provides care to all regardless of ability to pay. Insurance? They’ll take it. No insurance? No problem. It’s enormously popular and very successful, having expanded three times now from its original size, and is now a pretty good sized place with a full trauma ER, cancer clinic, orthopedic surgery and a lot of other things.
Any local politician, of any party, running for office in that county who was stupid enough to suggest that hospital be fully turned over to the private sector would be run out of town on a rail. Tax-funded, non-profit with an elected board of governors. Socialism, basically, and conceived and executed by elected politicians running on the GOP ticket.
Could today’s GOP be the architects of something like that? I’d say not a chance in hell.
Not all American conservatives subscribe to the idea that government is less effective than the private sector always and everywhere. Not by a long shot. The GOP is in trouble. It may or may not become fully apparent in this coming election, that depends on a lot of things, but they have one hell of a problem if they’re pissing off third-generation ranchers around here.
And they are. Slow but sure, they are.
Which is actually an excellent point. We all depend on each other. If one part of society is failing, well, sooner or later the cracks spread and everything falls to pieces.
We may live in a gorgeous house and done everything right in our lives – but the minute the guy next door can’t pay his mortgage and the house is in foreclosure, well, that may well affect the value of our house.
Enabling everyone to be successful not only makes us all more successful. It makes us enjoy our success even more!
Being rich is no fun in a society of have-nots.
Yup Kevin – the government (IRS) are very selective with their accounts – I should be very wary of referencing them and stick to blogosphere talking points
The USA has one of the most progressive national income taxes in the world. However I agree that other taxes work against that, notably FICA and sales tax, to an extent local property taxes and for sure state lotteries. But think how much worse it is in Europe with 20% plus VATs.
Couldn’t agree more Elena.
I would add the corollary that holding people back and pulling them down never leads to joy.
Expat:
oh FFS no one is talking about “holding people back”, the issue here is how gross the imbalance has become. We have not seen such a gap in our society in almost a century, and back then it was properly labeled the “Robber Baron Era”.
And the GOP is ready to make the situation worse, not better – that is the essence of the Ryan Plan, which they have all voted for. Every one of them, even the so-called “moderates”.
As for the tax rates, I never said the IRS figures were off, just that Federal income tax is just one component of a far more complicated picture. In one blog after another, it is “conservatives” that use talking points from think tanks to push this notion that “half of all Americans don’t pay taxes”, which is bullshit, and poisonous bullshit at that.
Now I have to sign off, work calls. Catch you all some other day.
Last year I earned $1200 and some change. On that I am supposed to pay $147 in self-employment tax (FICA etc.). Comes to a bit over 12%. But of course it’s not “income” tax (despite its being based on my income) so it doesn’t count, does it? So I’m counted among that proverbial 50% of Americans who “pay no tax at all.”
This year I might earn just enough to cover my living expenses. And I’ll have to pay 12% of that in tax, most of it toward Social Security that I will never collect on. And there’ll be “income” tax too. Looks like I’ll be paying a much higher rate than the Romneys. As a result, my income won’t cover my living expenses after all.
Can someone explain to me again how fair this is?
Why do you think you won’t collect on SS Madame?
Expat:
What’s the problem with VAT? In a sense, it’s a very fair tax, in that the more you spend, the more you pay. (One imagines that both Gingrich and Romney would be contributing rather more daily to the tax coffers than they do now if the US had VAT.) And everyone pays it: there’s no escape, no opportunity for avoiding it or evading it; no opportunity of dodgy deals to exempt this corporation or that corporation. Nor, obviously. can you get out of it by setting up offshore. Nor is there any point in a company wandering about from one town or region to another (remember Chief Wiley’s constant municipal efforts to attract business?) in search of an ever-better deal-of-the-month.
(The snag, of course, is that since it’s applied to services as well — being a poor crippled squirrel, I don’t pay income tax, or the British equivalent of property tax — it has a disproportionate effect, in that it’s rather a large percentage of my phone and utility bills. But it’s not, at least in the UK, applied to what might be termed the absolute essentials: food [apart from hot pasties!], children’s clothing, or books.)
Expat – Because I’ll be collecting my dead husband’s SS. So whatever I pay in counts for nothing.
Ah – that’s how it works Madame. The wonders and inequities of SS.
Red – VAT is regressive in the sense that no matter how little you earn you still have to pay it for most if not all of life’s necessities. Governments like it because it is easy and to a degree stealthy. I never noticed VAT until I came to live in the states and got annoyed by a 5% sales tax being added to the final price at the checkout. Before then I hadn’t noticed that near 20% was being added along the way for any purchases that I made back in the UK. I believe that Maggie liked VAT – fair in the sense that everyone paid regardless – like a poll tax.
Fuck yeah.
http://www.guardian.co.uk/media/2012/may/01/rupert-murdoch-fox-licences-us
http://www.guardian.co.uk/media/2012/may/02/murdoch-phone-hacking-us-senator