This article appears in the Summer 2019 issue of The American Prospect magazine. Subscribe here.
I spent the day after the 2016 election at Yale Law School, Hillary Clinton’s alma mater. I was supposed to speak to a foreclosure litigation class about my book Chain of Title, and then address the local chapter of the American Constitution Society over lunch. I got through the class, but the lunch speech never came off; Yale Law students were too deep in grieving mode over the results of the election. The catered lunch was still there, so my contact and I went down to eat in this huge, empty lecture hall where I had been scheduled to speak. As I looked up, already demoralized by the day’s events, I saw the massive portrait of one of Yale Law’s former professors: Robert Bork.
What struck me in that moment, and now, is that Robert Bork had won. Not because Donald Trump was elected, although there is a direct through line between Bork’s contributions to jurisprudence and Trump’s success, as I’ll explain later. No, Bork had won long before he became nationally known as a failed Supreme Court nominee. In a very real sense, we’re living in a world Robert Bork constructed. We’re all breathing Robert Bork’s air, suffering through Robert Bork’s wage stagnation and inequality, limping through Robert Bork’s twisted version of democracy.
Robert Bork changed U.S. policy toward concentrated corporate power without ever serving as an elected official, without altering a single line of text in any statute. His book The Antitrust Paradox simply reinterpreted the Sherman Antitrust Act as entirely concerned with consumer welfare, defined narrowly as efficiently delivering goods at low prices. He had written the concepts of democracy or economic liberty or protection of markets completely out of the story.
After a decades-long crusade, aided by a network of University of Chicago scholars, Reagan administration appointees, judges, corporate lobbyists, and executives, and even some willing Democrats, Bork got the antitrust establishment to adopt his circumscribed, dangerous vision. Federal policy on monopolies, once a subject of public interest, became a cloistered venue for economists, who build models singing the praises of the efficiencies derived from corporate combinations.
The next 40 years tell the rest of the story. We’ve seen economic gains funneled to the very top; monopolization of core industries in technology, health care, communications, defense, and agriculture; a completely anomalous situation of soaring corporate profits amid low private and public investment; a degradation in quality service, because monopolists don’t have to compete for your business to thrive; a slow death of entrepreneurship and innovation, with incumbents sitting on their personal fiefdoms and talented people unable to get their ideas into the marketplace; and a democracy that responds only to the very few.
Whether you’re an environmentalist trying to save the planet from devastation, or a fast-food worker in need of a living wage for your family, or a student survivor of a mass shooting who wants to save lives, you’re fighting concentrated corporate power. If you want to travel on an airline, or sign up for cable and internet, or drink a beer, or get treatment for illness, you’re transacting with concentrated corporate power. You can see concentrated corporate power’s effects in a supermarket aisle, with shelves and shelves full of brands and products that, if you look at the name of the corporate parent on the back, turn out to be from a handful of companies. We have the illusion of choice, but the reality of a captured economy.
And yes—the presence of Too Big to Fail banks that crashed our economy and then held up the political system for a bailout convinced many Americans that we had a rigged system, beliefs ripe for a right-wing demagogue to exploit. Moreover, a primary reason Trump sneaked through the Electoral College despite losing the popular vote is that corporate concentration has led to a regional hollowing out, where a few superstar cities with dominant firms have pulled away from the rest of the country, leaving despair in their wake. Startups are heavily concentrated in big cities, while everywhere else, chain stores have replaced mom-and-pop businesses, finance comes from Wall Street instead of local lenders, and money flows out of these regions instead of into them. That too is a monopoly problem.
There was a time in America, during the last Gilded Age, when monopoly power played a central role in our political debates. The 1912 election presented multiple solutions for the problem of monopoly, and Woodrow Wilson (and his top adviser, Louis Brandeis) won, with their economic vision of dismantling concentrated power and democratizing corporate America—a project largely halted by our entry into World War I.
But today, after decades of near-silence, antitrust—the idea and the movement—has been reborn, midwifed by an economy warped by the concentration of business and the concentration of power. There hasn’t been this much talk about monopoly on the presidential campaign trail in over 100 years.
Bernie Sanders, in his June speech defending democratic socialism, stated: “We see huge private monopolies—operating outside of any real democratic oversight and often subsidized by taxpayers—with the power to control almost every aspect of our lives.” Sanders has little in common with centrist John Hickenlooper, who has antagonized Sanders supporters by excoriating their socialist beliefs. But the former Colorado governor, too, has decried “competition-strangling mega-firms in many sectors after decades of erosion in antitrust enforcement.”
This unanimity spans the full spectrum of the Democratic field, from John Delaney to Amy Klobuchar to Elizabeth Warren, whose proposal to break up tech giants has galvanized talk of anti-monopoly policy in the 2020 race. She’s backed that up with plans to bust up Big Ag, and has long sought to take on big banks. I interviewed Warren about her anti-monopoly work for this section.
The broader political system is coming around, too. The Federal Trade Commission and the antitrust division of the Justice Department, in what seemed like a prelude to long-delayed action, announced they had divvied up Facebook and Amazon (FTC) and Google and Apple (DOJ) for future investigations. In early June, the antitrust subcommittee of the House Judiciary Committee held hearings on the market power of tech platforms and its effect on a free press. This was “the first significant antitrust investigation undertaken by Congress in decades,” noted subcommittee chair David Cicilline. The hearings, along with the investigations, were bipartisan.
So was a remarkable hearing in the House Oversight Committee in May about a military spare-parts contractor called TransDigm. Committee members ranging from Alexandria Ocasio-Cortez on the left to Freedom Caucus leader Mark Meadows on the right successfully demanded that the company return $16.1 million in excess profits gained through controlling a monopoly on small parts and marking them up, in one case, by as much as 4,451 percent.
This special section of The American Prospect highlights several sectors where monopoly power has run amok, and seeks to understand how these markets went awry and what we can do about it. We examine how the digital platforms control vast amounts of online advertising, peeking under the hood of the process to show the linkages between the loss of our privacy and the concentration of market power. We delve into the insulin market, questioning how a 100-year-old drug could possibly have tripled in price in a decade. We explain the big banks’ latest maneuver to frustrate regulation by touting financial literacy programs in an effort to displace the burden for fair dealing onto the individual customer. And we show how antitrust laws have been distorted to reinforce the power of big business, while preventing associations of workers or small producers from banding together to exercise power on their own.
The destruction of antitrust policy and the resulting extreme concentration of market power is one more example of the disgrace of neoliberal ideology—the claim that markets can regulate themselves in the public interest. In a concentrated, laissez-faire economic system, regulation does not go away: But private businesses in effect become the regulators, and instead of democratic decision-making we get decisions handed down from the corporate boardroom. The result is naked, predatory self-interest. We intend to stay on the case, as we keep exploring the multiple failures of neoliberal ideology when it is applied as policy.
The new awakening on the campaign trail, among regulators, and in the halls of Congress on the dangers of monopoly power won’t get very far, however, unless it’s matched by a wave of public indignation. Historically, the ability to counteract monopolies has come not from Washington but only when the public demands that their representatives put America back on track. The first step to pursuing a sustained battle lies in understanding the full scope of the challenge that corporate concentration poses. Let this section be part of that guide.