byTepper, Jonathan & Denise Hearn, reviewed by Jay Bushnell

         Tepper and Hearn describe how the United States has evolved from an innovative production centered economy to one solely interested in making money. Failure to regulate has led to the formation of large dominant corporations that dictate the conditions and prices of production. These monopolies kill competition. Warren Buffett’s primary investment strategy targets industries that control a particular aspect of the economy, i.e. these industries are monopolies, or duopolies. “Buffett loves monopolies and hates competition,” (p.2). Peter Thiel, the libertarian billionaire of PayPal fame, holds the same distain for competitions. In his book, Zero to One, he states competition ‘…is a relic of history” (p. 4)        

Since the 1990s, there has been an avalanche of mergers that has resulted in a drop from over 7,000 to just over 400 public listed companies on the stock exchange! Many of the companies were cannibalistically removed from competition.   In essence, these monopolies/duopolies control wages, the availability, and the price of what they produce. This allows a system that “…leads to higher profits, higher prices for consumers, fewer startups, lower productivity, lower wages, and greater inequality,” (p.13). Competitive innovation also becomes less important. Ponder this. There are now only five defense contractors satisfying our military appetite. Will the Pentagon be able to maintain our present defensive edge in this environment? Costs assuredly will rise but will improved quality follow?       

Failure of the federal government to regulate this system of concentration has provided corporations the power to determine pricing whether it is the beer you drink, the drugs you need, the price of an airline tickets, access to TV, defense contracts, phone service, your salary, employability, insurance rates, banking protection, or health care. This system becomes like the old “company store” of the past. Being the only job in town, makes it easy to be abusive. Rural areas have been hit the hardest. Rural America is dying because these folks are not being protected. The market is controlled by large conglomerates. The chicken industry is the poster child of this abuse. Many farmers actually qualify for food stamps! This is a feudal system.

         The concentration of wealth in the hands of a few corporations also provides the opportunity for them to not only fix prices but to also change the laws in their favor. You may remember the euphemism “the right to work laws” in states like Wisconsin that were aimed at destroying unions. It became illegal to force someone to join a union in order to work at a company. Well, some of the same companies now require one sign an agreement that an employee can not move to another company. For example, if you worked at a McDonalds, one could not move to a Wendy’s or even another McDonalds! Also, increasingly class action suits against an employer are being removed.

Corporations’ buybacks of their own shares increase the value of shares available to the public and provides a bonus to CEOs, but not the employees. Of course, the recent tax break provided the funds for massive buybacks. These are scams.           Pundits continually harp on the low rate of unemployment. What they do not mention is that the rate describes temporary employment with low salaries, no tenure or benefits. The salaries do not provide a living wage. Job security is becoming a thing of the past.        

One of the most disturbing elements of this issue involves companies like Google, Facebook, and Amazon. Google, Facebook, and Amazon practice censorship that prevents competition plus they mine your personal lives for profit without your permission. Even President Obama failed to rein in these monopolies because they provided him with the   “…second-largest source of campaign donations…” (p.95). In fact, whether Republican or Democrat, antitrust enforcement has been AWOL. Lobbying provides the muscle to prevent legislation that fosters competition. This is especially effective when enlisting former congressional members.             Ironically, there has been an explosion of regulations at the federal level that actually adversely affect economic growth. Many of the regulations actually favor monopolies because they stifle competition. So, monopolies often welcome government regulations. Moreover, because they have the funds and staff to fight against regulations, they do not like they are less concerned about them even though they use deregulation as a talking point. Deregulation is cultural mantra of their political base. Small businesses simply do not possess the resources to challenge these regulations. Moreover, “the greater the incentive to lobby, the more dysfunctional the political system becomes, and the more disillusioned voters come to be “(p.189).        

Tepper and Hearn outline several systemic solutions to reestablishing competition into our capitalist system. For example, rules should restrict industrial reps from working in government and government workers from becoming industrial reps. The authors also outlined personal things that each and every one of us can do. When possible, support companies like Costco that takes care of their employees. One needs, to recognize that the services of companies like Google and Facebook appears to be free but they are not. One is being played when using these ‘services’. There are other choices that the authors outline. It will take a lot effort on our part to help reform the system. The authors stress that political freedom requires economic freedom.