Book review: “The Curse of Bigness: Antitrust in the New Gilded Age”

The Magna Carta, the Constitution of the United States, and other foundational laws of democracies around the world were all created with the idea that power should be limited– that it should be distributed, checked, and balanced, so that no one person or institution could enjoy unaccountable influence.

Yet this vision has always had a major loophole. Written as a reaction to government tyranny, it did not contemplate the possibility of a concentrated private power that might come to rival the public’s, of business people with more influence than government officials, and of an artificial creature of law, the corporation, that would grow to have political protection exceeding that of actual humans.

The struggle for democracy now and in the progressive era must be one centered on private power– in both its influence over power, and union with, government.

I picked out this quote from the conclusion of the book, because it provided a nice summary of the thrust of this book: that the biggest threat to our democracy today are massive corporations. This is a real concern of mine, and the more I read about it, the more concerned I get. I first took notice when I read a book with a similar aversion to concentrated power: The Road to Serfdom by Friedrich Hayek. Hayek wrote that book as a scathing critique of concentrated power in government, and directly connects the dots to Nazism and Communism. Hayek, who is a strong believer in markets and a conservative intellectual, however, also mentions in passing that concentrated power in any form, including the corporate world, can be just as bad. It was just in passing, but it seemed to beg the question: when is there too much concentrated power in business, and have we already witnessed it?

Historically, I was already acquainted with the Gilded Age and its robber barons: Andrew Carnegie, John D. Rockefeller, and J. P. Morgan. History books documented their stories– and of course, Teddy Roosevelt’s epic quest of trustbusting. To me, that was a dragon already conquered. But why hadn’t their been any similar stories today? I wasn’t aware of the more recent battles with AT&T and Microsoft, but that was because they were before my time. And come to think of it, who kept giants like Amazon, Google, and Facebook and bay? Oh wait. They don’t.

Since then, I have read additional books in the same thread, including [The Elite Charade of Changing the World](). This one is a scathing critique of the accumulation of excessive wealth, summing it up as a way to bypass democratic processes. Money, no matter how well spent or to what charity it goes to, is used to influence policy and determine priorities that aren’t determined by the people. I was a little suspicious, because while I was agreed with many points, it sometimes sounded a little too left for me. I think markets are good and important, and government meddling is the ultimate hubris that they can make everything right if they just stick their hands in. But the author does a masterful job of incorporating a firm backing in political theory: Thomas Hobbes’ Leviathan:

Hobbes believed that structurelessness wasn’t all it cracked up to be [by the way, compare this with Hayek’s idea that organization equals power], especially for the weak. The powerful Leviathan for which he advocated is often treated as shorthand for monarchy or authoritarianism. But in fact what Hobbes is suggesting was that the choice is not between authority and liberty, but between authority of one sort and authority of another. Someone always rules; the question is who. In a world without a Leviathan, which is to say a strong state capable of making and enforcing universal rules, people will be ruled by thousands of miniature Leviathans closer to home– by the feudal lords on whose soil they work and against whom they have few defenses; by powerful, whimsical, unaccountable princes.

I could definitely see today’s tech giants as powerful, whimsical, unaccountable princes.

Wu’s The Curse of Bigness doesn’t have as much apparent bias towards left or right. His argument about markets, I think, could appeal to both sides. And historically, the issues of trusts has been a bipartisan issue. He nails something down that I hadn’t thought about before: when it comes to the economy, I always thought championing markets meant laissez faire: you don’t try to meddle with the invisible hand, because it is the most efficient way of doing things. It will figure itself out. Anything less is trying to impose a political dogma in the economic sphere. But Wu says that isn’t the primary value of markets. He critiques laissez faire economics as a historical ally of Social Darwinism (Social Darwinists embraced laissez faire, opposing any interventions that might be thought to stop from displacing the weak) and the de facto rule of the wealthy.

Instead, Wu reminds us that the whole reason markets are efficient is the principle of competition. That should be the prime goal of markets. If competition isn’t present, you just let the few who unscrupulously climbed their way to the top rule the hill and push anyone back down who may try to displace them. Wu includes a very insightful historical analysis of the rise of corporations in the 1890s, the rise of the Robber Barons, the trustbusting heydeys, and some insights into why that doesn’t happen today. He includes in the conclusion a few ways forward, and how we can reclaim the spirit of trustbusting to maintain a vibrant democracy.

It is an interesting idea that the economy itself is a part of our democracy. We usually separate the two. Wu uses a reformer from a previous age, Louis Brandeis, to explain this idea:

If he had a unifying principle, politically and economically, it is what we have said: that concentrated power in any form is dangerous, that institutions should be built to human scale, and that society should pursue human ends. Every institution, public and private, runs the risk of taking on a life of its own, putting interests about those of the humans it was supposedly created to serve

Wu mentions some current events, but as it was published in 2018, it misses some interesting current developments. I was thinking of Elizabeth Warren’s campaign promise to take on Google and other tech giants. Will she follow through? And the recent case of pharmaceutical companies being held accountable for the opioid crisis. Will that potentially lead to an opening for trustbusting in the pharmaceutical industry? Probably not, and they’ll just pay a lump some of money and move on. I would hope that this got more attention, and I do hope Wu’s book gets the hearing it deserves.

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