The Return of Monopoly
I was reading a book by Frederick Lewis Allen, The Big Change last night. Written in 1952, it is a fairly detailed and readable account of various changes in the American economy, society, and to a lesser extent, in the American polity (mainly how the polity became more integrated with the economy) between 1900 and 1950. One of the most interesting of Allen's points is that the Soviet Communist critique of the American economy in 1950 was fifty years out of date. Unlike the economy of 1900, large corporations were generally publicly owned by a fairly broad sector of the population who had substantial information about the property they owned thanks to more transparent accounting practices. Moreover, what monopolies those corporations had were fairly narrow. Competition was fairer. Like all moderate liberals of the recent era, Allen attributes these revolution-impairing changes to the growth in the size of the federal government since World War I and the ability of this government to regulate and manipulate this economy to a degree that syndicates of the wealthiest private individuals had been able to achieve in 1907 but had failed in 1929 thanks "to the collapse of the market economy that had developed in the nineteenth century."
Allen has much to recommend his thesis, including a strong rebuttal of current laissez faire thinking in modern conservative economics in two respects. First, he establishes that private economic initiative and the classical economics that informed it was insufficient to control the speculation that led to the 1929 crash and to end the depression that followed. Second, he establishes that the corporation has no standing under natural law (read, the common law) and that the modern corporation is a creature of legislation, and so can be legitimately legislated to life or death according to the requirements of public policy. The holding company, he reminds us, is but a legislative innovation created by the state of New Jersey to enlarge its tax base.
One current of thought about American government or government in general that owes its genesis to Marx, but its sophistication to others, is that world governments, including our own, are fronts for powerful multinational corporations. One publication, The People's Almanac listed the largest multinational corporations in the same section where the countries of the world were listed. Although I have called our form of government capitalista in frustration, I've never really found any justification for thinking that the US belongs anyone but those of its citizens who vote. No matter what happens, politicians still need votes. Moreover, it's hard to believe that all major corporations would abandon competition to unite under the banner of one candidate or another. Yes, corporations take advantage of the feeding trough, but the greatest monopoly of our era is a maker of software. Microsoft is not quite as dominant as United States Steel once was. It is hard to believe that any corporation or group of corporations could do anything to thwart the popular will.
Well, I used to think that. After reading Robert F. Kennedy's recent article on the media conglomerates , I'm not so sure.
One important point to make after reading Kennedy's article is that the theoretical legal obligations of newspapers are weaker than those of radio and television broadcasters, but the level of journalistic integrity present in newspapers (at least I think this is the common opinion) is stronger. Newspapers and related print media have foundations in the American legal system that date to the early 18th century. Indeed, these are often constitutional provisions. Oft-quoted in this blog is the Pennsylvania Constitution of 1776, "a free press being necessary to a free society, the freedom of the press shall not be abridged." This provision was not included in the equivalent of the Bill of Rights but in the Frame of Government, thereby theoretically establishing the press as an independent branch of government. By 1940, the rules for newspapers were finally reduced to one: don't engage in false libel. Some might add the rule: don't shield sources in the context of legal proceedings, but I think that rule should be broken in most cases.
Radio and television journalism is on shakier legal ground. The airwaves are legally public domain, and broadcasters are thought to provide a public service. I usually argue that corporations that provide such public services can be more strongly bound by the government on the grounds of Roger Taney's Supreme Court decision in the Charles River Bridge Case, but I think everyone here is familiar enough with the language of public domain to understand that broadcasters probably should be bound by an inverted libel statute of some sort to prevent the absurdity in Florida that Kennedy recounts. I would argue for the creation of a pro se tort of whitewash that would allow grounds of countersuit for journalists or anyone else that could prove that broadcasters knowingly broadcast false information, especially for the benefit of their advertisers. And boy, would I like to get at the advertisers, too.
In other news: Opportunity data release!
ESA(20040824.1)
I was reading a book by Frederick Lewis Allen, The Big Change last night. Written in 1952, it is a fairly detailed and readable account of various changes in the American economy, society, and to a lesser extent, in the American polity (mainly how the polity became more integrated with the economy) between 1900 and 1950. One of the most interesting of Allen's points is that the Soviet Communist critique of the American economy in 1950 was fifty years out of date. Unlike the economy of 1900, large corporations were generally publicly owned by a fairly broad sector of the population who had substantial information about the property they owned thanks to more transparent accounting practices. Moreover, what monopolies those corporations had were fairly narrow. Competition was fairer. Like all moderate liberals of the recent era, Allen attributes these revolution-impairing changes to the growth in the size of the federal government since World War I and the ability of this government to regulate and manipulate this economy to a degree that syndicates of the wealthiest private individuals had been able to achieve in 1907 but had failed in 1929 thanks "to the collapse of the market economy that had developed in the nineteenth century."
Allen has much to recommend his thesis, including a strong rebuttal of current laissez faire thinking in modern conservative economics in two respects. First, he establishes that private economic initiative and the classical economics that informed it was insufficient to control the speculation that led to the 1929 crash and to end the depression that followed. Second, he establishes that the corporation has no standing under natural law (read, the common law) and that the modern corporation is a creature of legislation, and so can be legitimately legislated to life or death according to the requirements of public policy. The holding company, he reminds us, is but a legislative innovation created by the state of New Jersey to enlarge its tax base.
One current of thought about American government or government in general that owes its genesis to Marx, but its sophistication to others, is that world governments, including our own, are fronts for powerful multinational corporations. One publication, The People's Almanac listed the largest multinational corporations in the same section where the countries of the world were listed. Although I have called our form of government capitalista in frustration, I've never really found any justification for thinking that the US belongs anyone but those of its citizens who vote. No matter what happens, politicians still need votes. Moreover, it's hard to believe that all major corporations would abandon competition to unite under the banner of one candidate or another. Yes, corporations take advantage of the feeding trough, but the greatest monopoly of our era is a maker of software. Microsoft is not quite as dominant as United States Steel once was. It is hard to believe that any corporation or group of corporations could do anything to thwart the popular will.
Well, I used to think that. After reading Robert F. Kennedy's recent article on the media conglomerates , I'm not so sure.
One important point to make after reading Kennedy's article is that the theoretical legal obligations of newspapers are weaker than those of radio and television broadcasters, but the level of journalistic integrity present in newspapers (at least I think this is the common opinion) is stronger. Newspapers and related print media have foundations in the American legal system that date to the early 18th century. Indeed, these are often constitutional provisions. Oft-quoted in this blog is the Pennsylvania Constitution of 1776, "a free press being necessary to a free society, the freedom of the press shall not be abridged." This provision was not included in the equivalent of the Bill of Rights but in the Frame of Government, thereby theoretically establishing the press as an independent branch of government. By 1940, the rules for newspapers were finally reduced to one: don't engage in false libel. Some might add the rule: don't shield sources in the context of legal proceedings, but I think that rule should be broken in most cases.
Radio and television journalism is on shakier legal ground. The airwaves are legally public domain, and broadcasters are thought to provide a public service. I usually argue that corporations that provide such public services can be more strongly bound by the government on the grounds of Roger Taney's Supreme Court decision in the Charles River Bridge Case, but I think everyone here is familiar enough with the language of public domain to understand that broadcasters probably should be bound by an inverted libel statute of some sort to prevent the absurdity in Florida that Kennedy recounts. I would argue for the creation of a pro se tort of whitewash that would allow grounds of countersuit for journalists or anyone else that could prove that broadcasters knowingly broadcast false information, especially for the benefit of their advertisers. And boy, would I like to get at the advertisers, too.
In other news: Opportunity data release!
ESA(20040824.1)
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