Growing corporate power threatens America's strength -- its middle class
Last week’s ruling by a federal judge approving AT&T’s $85 billion purchase of Time Warner was the latest in an unbroken string of massive victories for too-big-to-fail corporate America.
Expect the AT&T ruling to unleash a stampede of mega corporate mergers. On the heels of the AT&T ruling, cable television giant Comcast announced a bid for 21st Century Fox. Comcast will be battling with another entertainment colossus, Disney, over the Fox assets. Drugstore mega chain CVS now has a stronger hand for its acquisition of Aetna and its millions of health care insured. The race is on for huge corporations that dominate in one area seeking to expand their influence by buying up other large companies that excel in different types of business.
Granted, the Justice Department opposed this merger, an exception in an administration that has otherwise worked to remove restrictions on corporate power. That led to speculation that Justice, in opposing the deal, was acting on President Donald Trump’s behalf to punish CNN, which is owned by Time Warner.
In any event, AT&T’s judicial triumph adds to the long winning streak for corporate America at the federal government level. It is almost a cliché to state that corporate interests rule the country.
Theodore Roosevelt — a Republican — was the first American leader to champion the role of government acting as the umpire to regulate capitalism. Roosevelt advocated that government curb capitalism’s unchecked tendencies to corner markets and create monopolies.
Ever since, corporations and government have waged their battles over regulations in court and in Congress. In our recent history, however, campaign money has placed a large thumb on the scales, tilting them dangerously in favor of the corporations.
Capitalism is not a villain. Far from it. Capitalism is the best economic driver the world has ever witnessed. The profit-driven competitive system delivers products and services at affordable rates to masses of people. Capitalism is the vehicle that created the American middle class. The capitalist credo of free market competition rewards innovations that make money. That is the bedrock of what has driven American prosperity and world economic dominance.
Yet capitalism does not promote the general welfare. Maximizing profit for the company and for shareholders is what drives business decisions.
Free markets provide individuals the opportunities to pursue the “unalienable rights” of “Life, Liberty and the pursuit of Happiness” referenced in the Declaration of Independence. But it is up to government to guard against corporate power becoming so great or its behavior so abusive that it inhibits rather than enables these rights.
Increasingly, American governance, broken and corrupt, is failing to meet that obligation. Corporate capitalism has gained the upper hand to thwart government regulation. Corporate funding is spent to breed policymakers who act on the behalf of corporate interests.
Corporate capitalism, the engine that once powered the middle class, now is having the opposite effect. Manufacturing jobs are shipped overseas to cut costs. Technology is wiping out even more good-paying careers. At this rate, there won’t be enough people with good jobs to purchase all the goods capitalism supplies.
The resulting accumulation of wealth and influence and the erosion of the middle class is why so many Americans are discontented. It is a big reason why the nation elected Trump president.
Yet, under Trump, the situation has gotten worse. Much worse.
Both major parties are beholden to the financial, defense, insurance, energy, and pharmaceutical industries that fund their campaigns and perpetuate incumbency. However, it is the Republican Party that effectively has become a wholly-owned subsidiary of corporate America.
This is why protecting profit, rather than meeting national defense priorities, drives weapons production. It is why America has no health care system assuring citizens access to basic care. And it is why Wall Street hedge funds proceed unchallenged as they buy and destroy American businesses for profit alone.
The nation has a federal agency called Environmental Protection which, under Administrator Scott Pruitt, is systematically dismantling regulations intended to restrict corporations from polluting the air and water. Under acting Director Mick Mulvaney, the Consumer Protection Agency has become the corporate protection agency, eliminating safety and fraud regulations.
Government must regain its ability to defend the public interest with tighter corporate regulations. Corporations must play a longer game than trying to improve the last quarter’s earnings report.
Most importantly, the public needs to cease treating politics like a TV show and take its role in the process seriously. It will take what it has always taken to address abuses – an engaged citizenry, hard-nosed bargaining, principled arguments, and, ultimately, compromise.
America once was the place where the world learned how to do things better. It is well past time for us to be that again.
The editorial board is composed of the publisher and four journalists of varied editing and reporting backgrounds. The board's discussions and information gained from its meetings with political, civic, and business leaders drive the institutional voice of The Day, as expressed in its editorials. The editorial department operates separately from the newsroom.
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