Some consolidation is natural, but a huge part is caused by mergers and acquisitions (M&A) fulled by Private Equity. The M&A benefits the shareholders of participating companies at the expense of consumers, employees, and other companies.
Monopolization almost certainly is occurring. The left usually cites weak antitrust enforcement. The right usually cites regulatory barriers that make it expensive to compete without economies of scale. I actually think both sides are at least partially correct.
However what almost everyone overlooks is the demographic transition. The US, along with every other developed economy, is significantly older today than it was 40 years ago. And the fact of the matter is that an older work force almost certainly leads to an economy with larger, older firms.
Most entrepreneurial activity is disproportionately carried out by younger people. Young workers are much more likely to work for small, young, growing firms. That makes sense because they have longer horizons and can take more risks. Older workers, who have higher fixed expenses and are closer to retirement, prefer the stability of a stable, large company with low employee turnover.
Macroeconomists who have attempted to quantify this impact, generally find that the average firm age in an economy linearly increases with the average worker's age.[1] Since older firms, tend to be larger, slower growing, and less competitive, it's not wonder we've seen an increase in monopolization.
> The left usually cites weak antitrust enforcement.
Personally for a left view I would add cash/capital accumulation. It's kind of the same thing happening for individuals with wealth and real estate. Regulation is failing to bring the balance between the revenues of capital (which are exponential unregulated) vs the revenues of work. At one point you can't even compete anymore if you start from scratch. Competitors with billions in cash can pretty much "kill" any new business they want.
Firms that are monopolistic are less competitive, larger, and slower growing. Reducing monopolistic tendencies increases capital growth, competition, and reduces average firm size. This is well understood economics.
Monopolies arent' some hypercompetitive ultra capitalist battlespace, they're fat and happy, and the most impactful teams they employ are lobbyists and policy folks in DC. Look at like, comcast and what they did with the FCC.
Those attributes stem from them being a monopoly, they don't create it in the first place. He's questioning the implication that being less competitive and slower growing would allow you to obtain more of a monopoly.
The large, lumbering not-yet-a-monopoly has no method to increasing market share other than buying smaller competitors; thus leading to monopolization.
Yes, regulatory capture is a problem, but it's somewhat ludicrous to make a blanket statement like "government is the tool used to suppress competition". It's one tool in the toolbox, perhaps a significant one, but hardly the only one.
Health care is another example. The government empowers the AMA to strictly control the number of seats in medical school, thereby restricting the supply of doctors and competition.
Licensing, permits, etc, are all ways to limit and prevent competition.
I could ask any surfer on the beach right now and even they'd be able to identify that you've now entered a kind of argumentation where, if government is at all involved, government is the problem, no matter how it's involved.
"The AMA strictly controls the number of seats, and the government has a medical licensing process, therefore the AMA's actions are the government's fault."
Again, I do not deny that governments have been used as a tool for monopolies to form, but it is dubious that they are the only tool used by bad actors, nor is regulatory capture the only method for anticompetitive behavior.
You didn't, but your phrasing certainly implied it. "The government is the tool used to suppress competition" is a very stark statement. Next time, say "a" or "one of the" tools.
A simple alternative ingredient could be that firing (read "punishing") employees on a small scale has a large chilling effect. Relaxing labor laws/job security may have a much larger long term effect. If I ask for a raise, will I get fired first either way?
You need government to build an ISP in the first place. No private company would be able to negotiate with that many land owners to build out fiber on a large scale.
And once a company does build a network, absent government regulation requiring them to let other companies use it, the existing infrastructure is an enormous barrier to entry.
Telephone lines were almost always built following existing public roads or private railroads (that were built with government assistance and government land grants) even in the early days.
There is no history of a successful, large scale infrastructure project built without government assistance. Either directly or due to the fact that much of it was built on government land.
(unless maybe you consider some case where private infrastructure was built in one large area controlled by a small group of owners, but that's basically just a government by another name and doesn't apply to modern America.)
railroads were given the go-ahead by the federal government back when they were built, because the federal government granted the land to both sides of the rails to the rail builders (if they built it).
It's hard to argue that the railroad builders were not given "assistance" (the granting of land).
Those were all local municipalities, responsive to their electorate - if the surfers in a community wanted Google fiber huts, they could elect councils who would allow them.
I think it's reasonable that people should have local control over their city environs, even if it means a multinational like Google can't come in and build new infrastructure. It's not a "will of the people, unless Google wants to build fiber huts everywhere" kind of society. Maybe they should just go surfing instead.
>Those were all local municipalities, responsive to their electorate - if the surfers in a community wanted Google fiber huts, they could elect councils who would allow them
This is an idealistic line of thinking, but as a practical matter, is completely untrue. Essentially 0% of America understand their county commissioners' stance on ISP competition, myself included. No one campaigns on those things.
It's a lot like saying that electorates are responsible for police violence because sheriffs are elected officials after all.
> The government is the tool used to suppress competition.
Oh? Network effects don't exist? Economies of scale don't exist? Dumping doesn't exist? Branding doesn't exist? The only kind of moat in existence is regulatory capture?
Regulatory capture is real, but it's one of many tools that suppress competition. I can think of one single solitary competitive analysis I've been party to where we decided it was the largest factor.
If only fixing anticompetitive markets were as easy as "drowning the government in a bathtub" we'd have solved this problem ages ago.
"the tool" meaning it was the first tool they reached for, not the only tool.
For example, if I said "Star Wars" was "the movie" to see in 1977, I obviously did not mean it was the only movie.
If I meant it was the only tool, I would have written "the only tool".
If you need to insert the words "only", "always", "never", "100%" into my words in order to argue, you should reconsider the strength of your argument.
Nah, I heard what you said and you said what you meant.
Even so, I'm happy to engage with your new argument: that regulatory capture is the first tool companies reach for to unfairly suppress competition. That's still wrong. Regulatory capture is slow, unwieldy, and opportunistic. The first tool a company reaches for is typically either M&A or dumping.
When WhatsApp was getting popular, did Facebook respond by crafting legislation with a plausibly deniable dual purpose, cultivating connections with campaign contributions and a held-open revolving door, wait for a wave of public sentiment that could carry their law up the priority list, through congress, and onto the books, and then sit back and pray that the resulting wind blowing at their backs and in WhatsApp's face would tip the balance enough to keep them on the throne? No, of course not! Facebook bought WhatsApp. Where there were two competitors, a free market exchange happened, and then there was one competitor. See also: banks. Yeah, they need FTC approval, but the free-er the M&A market, the easier it is for competitors to just merge together, and the more anti-competitive the result.
As for dumping, you'll often hear people blame legislation for the big ISP monopolies we have. Certainly there are no shortage of legislative failures in this space, yet it's not illegal to start an ISP. If you set out to create an ISP of your own, you'll probably be able to find a municipality willing to deal with you. The actual trouble will appear when you start selling your service. Your first few customers will gladly switch in order to take advantage of the better deal you're offering, but once the regional ISP monopoly notices the churn, suddenly you'll find that all of your prospective customers recently received a promotional discount from the monopoly and are no longer interested in your service. Then you go out of business, and customer rates go back up. It wasn't a law that kept you out of the market, it was the fact that your competitor had a larger war chest.
In both cases, more market freedom = less competition. Certainly, regulatory capture also exists and is also a problem, and in that case more market freedom = more competition. In some cases, it's even more complicated: economies of scale create genuine value by amortizing costs across volume, but they also create an anticompetitve moat. They have good aspects and bad aspects that are inextricably linked and inseparable from each other.
Still, focusing exclusively on regulatory capture will lead you to misdiagnose most markets. The cure will appear obvious, but where your diagnosis is incorrect, it won't work.
Government has funds, land, resources and tons of attention. A competent business man should be able to forge large numbers of jobs out of this. If done on sufficient scale elaborate services and infrastructure can be build that gives corporations a huge advantage. These jobs can remove people from the labor pool and create a kind of cabin in the woods "exit" strategy that will eventually drive up wages and the value of training/education.
The situation is far more nuanced. If you said instead "The government can be a tool used to suppress competition," I think most would agree with you.
The distinction is that there are plenty of other tools companies can use to suppress competition, and Government also can be used as a tool to encourage competition.
A strict black and white view point that more government = less competition is absurd.
> The US, along with every other developed economy, is significantly older today than it was 40 years ago.
Looking only at average age doesn't give a full picture, how does this square with the Millenials recently becoming the largest generational cohort? By your logic shouldn't there be a massive wave of young growing companies.
> The US, along with every other developed economy, is significantly older today than it was 40 years ago.
As employees are squeezed out of profit, life gets more expensive and it gets harder to have kids.
Watching Super Size Me 2 you realize that the same thing happened to the chicken industry. It’s frightening. It’s like we have a democracy (so far) and under that a lot of smaller authoritarian organizations that are hard to notice or dismantle. Some of the farmers were basically slaves, in huge debts to these companies way of running things. Unbelievable.
And its growing ever more unavoidable in daily life for anyone trying to live.
Pretty much everyone is becoming subject to these authoritarian regimes (corporate structures) as they invade and carve away at our democracy through financial influence, regulatory capture, etc.
This should be actively fought every step of the way. We don't have to allow any corporation to do anything, they belong to the people who believe and give them power. Everything can be taken away, and everything can be burned.
Is there a way a startup could set up this business model, or would it necessarily require all the tax and legal implications of a publicly traded company?
The libertarian argument generally goes that competition will keep them all in check, but history has shown again and again how it doesn't work in the general case.
If you want to see what small government/strong corporate control is like, look back a century in American history. Corporations controlled much more of American life than they do even now, and the 20th century regulatory state is all very much a direct response to all that.
Say a group of people unionized and formed a collective coop org.
Workers would get paid fairly who were employed by the co-op and would be members of the union.
The union would create it's own credit union and financial instruments and be a mesh of a CU and old style savings/loan.
The CU/Bank aspect would also invest in real estate (section 8 housing mostly and other but try to keep rents down wherever it has rentals and keep rent competition in check).
$$ brought in would be pooled, and as we grew to a certain size we'd launch our own health insurance company. All $$ from investments/real estate/etc would go towards the health care, premiums would basically be collective medical costs - income from investments / members of union, and members could choose to pay more for members w/ more financial burden.
Eventually we could start other businesses and encourage our union to ONLY use those businesses that we own as a co-op. ISPs, Amazon-clone, Google alternative, etc...
Eventually we gain $$ and power to start building or buying hospitals of our own. We also invest in our own generics drug company and maybe even a research company to design new drugs. Everything we do we deliver at cost or close medical wise. When we have surplus at the end of the year members vote whether we should diversify it into more investments, pay out dividends to all union members, or apply it to the medical fund, etc....
Eventually we could expand beyond our co-op and offer to be the 'benefit plan' for states' medicaid/medicare, as well as employer plans. The goal being have better quality and lower costs for employers, states, and members.
Eventually we get state $$ on top of union dues to cover the $$ needed for our m4a plan. If we're constantly in the green, we could start looking at a UBI plan.
The concept is a marriage of capitalism, unions, socialism, libertarianism. It's based on the concept of dual power. Eventually you get enough power that you weaken the healthcare lobbies (by taking their business) so that the $$ and political will to thwart you isn't there because they can no longer enrich politicians because they're cash on hand keeps dwindling, eventually we'd have more $ to lobby with than they would.
Oh, I am all in favor of unions, and you're absolutely right. It's a tragedy, yet an unsurprising one, that business co-opted government to restrain union power the way it did.
In fact, in the "small government" vein, I'd suggest repealing Taft-Hartley immediately. The biggest immediate benefit to repealing that would be that unions could once again freely conduct wildcat strikes.
But that's not what libertarians generally think about when they think "small government," they think of ending social programs -- at least, in every conversation I've ever had with them. I've never had a one-on-one conversation with a libertarian (and I've had quite a few, thanks extended family) who thinks unions are a good thing or a way to balance corporate power.
Big difference though between 'libertarian party' and libertarian socialism. I'd support M4A, I've just given up hope through gov't sanctioned socialism, so let's find a new path through unions and combining forces of the many, creating some huge collective. W/ the internet it doesn't need to be local anymore.... it'd kind of be like those religious health share programs, but no religion needed.
This is an argument a lot of non-authoritarian socialists make: democracy only governs the few hours when people are not sleeping or at work, so a deeper, fuller democracy would include running workplaces democratically as well. Whether by employee-elected boards, cooperatives, democratically run unions (a necessary distinction), or some other form of collective control, that the consent of the governed is a question for all situations in which people find decisions about their lives being made.
Democracy is not an efficient way of running a business. Look at the multi-trillion dollar deficit as an example. Workers are incentivized to choose themselves over the health of the company or the customer.
Also, people overwhelmingly would rather exchange their stake in the company for the equivalent value in cash. It's only when the company's valuation skyrockets when they retroactively declare this to be unfair.
>Democracy is not an efficient way of running a business
Have any data to back that up? Comparing a democratically run corporation to the US government is a non sequitur. Outside VC there is no business model that will allow you to run at a loss for decades. So it's a scenario that's not even possible hypothetically.
Somewhat anecdotal but there is a Worker Co-op in Spain, Mondragon, that's been a very competitive corporation for over 50 years. It can clearly work long term and it leads to better outcomes for employees and the communities they work in.
Part of this is that VCs as you describe. It doesn't matter if a democratic social media company is more sustainable than Facebook when Facebook receives a half a billion dollars in VC funding to patch up its problems.
Anecdotally, I hear that Ford's biggest problem right now is the union's resistance in adopting the Toyota production system. If I were a factory worker, I wouldn't want to change the way I do things just so the shareholders get richer. That's a perfectly reasonable attitude to have, but it does place Ford at a disadvantage to car makers without unions like Tesla and Toyota.
For that business it might not be a good formula but public education seems to be the biggest thing missing. I've talked with employees who could very very easily run the show themselves if they simply got organized and made a [much smaller] bid on the contract their employer was bidding on. They also know their managers share in the huge profits, drink coffee all day and never show their face(!) If the people doing the work ask for anything there will be a huge deliberate delay or it won't be done as a reminder not to ask for things. Do it again and you will get punished. They are on a first name basis with employees working far away because of the sheer amount of improvisation. If you need widgets you will have to get them from someone.
The employees all know they could run the business but they cant picture themselves doing it. Their arguments are "It's to complicated" but struggle and fail to explain how. It might still not be a good idea but that they draw a blank is the ultimate hurdle for now.
what if all workers were shareholders and the 'union' was a subsection of the company like an autonomous entity w/in the company that still had some voice but that ultimately was ALSO about their bottom line so that their shares go up as do the shares of all other employees?
I often hear people complain about others making money in the stock market, so I suggest they invest in stocks, too. They respond saying it's too risky.
Well it literally is. If they are talking about Wall St. bankers they have no way to replicate the results of those people. Wall Street can make poorly thought out multi-trillion dollar bets on housing bonds and when they go bust they get bailed out and still get their Christmas Bonuses. There is no similar mechanism to protect a non-institutional investor from similar levels of risk.
The problem is you need capital to begin with, and the median American barely has enough on hand to cover an emergency, nevermind build significant investments.
Many of us might be fortunate to have well paid jobs, and the ability and capital to invest, but it's understandable how someone could view the ability of those with capital to generate further capital without any labour to be unfair.
The median American buys new cars, so they could by a used car and invest the difference.
I've known many people who didn't have any cash on hand, yet lived high on the hog with expensive clothes, new cars, and nice houses. They didn't have any cash on hand because they spent it as fast as possible.
If Earth was government by one big country, you'd have solid point, but most Americans would prefer that the next trillion dollar companies not all be based in India and China.
Also, what's best for the workers isn't necessarily what is best for society. Globalization is anti-worker, but it helps the consumer with cheaper prices, the company with extra profits, and developing countries afford what developed countries take for granted like antibiotics.
The parent comment is making a universal statement, and so it would hypothetically apply to companies everywhere, including in India and China. Perhaps then there would be a world without trillion dollar companies, or maybe the workers can figure out a way. The Mondragon Corporation is a tens-of-billions-dollar workers cooperative [0], for instance.
This line of discussion is also making the assumption that what's best of workers and what's best for companies are necessarily in conflict, which is rather silly given that if a company goes under, the workers themselves are in trouble. There is at least one example I can point to where a workers union forced management to recognize the need to be more economically competitive. [1] Also, it makes the assumption that management and/or shareholders necessarily know best for a company's future, and there is no shortage of evidence to the contrary, some even recent. [2]
> The parent comment is making a universal statement, and so it would hypothetically apply to companies everywhere
I don't find much value in hypotheicals. Even the far right Ben Shapiro admitted he would support UBI if automation makes most jobs obsolete.
There are smart workers and dumb shareholders, but at the end of the day, people respond to incentives. Audi workers would never agree to convert their factory to EV had Tesla not already proven that EVs are something consumers actually want. This isn't a bad thing, but it comes with a cost. Tesla was able to ramp up production as fast as it did because they didn't need to run every decision past a union.
Your opinion doesn't change the fact that your response was invalid. You are responding to a normative, idealistic statement about universal values with your own slightly more concrete hypothetical. A misapplied exercise in practicality.
> Audi workers would never agree to convert their factory to EV had Tesla not already proven that EVs are something consumers actually want.
That seems like a hypothetical without basis. One doubts that General Motors assembly line workers were the ones who killed the EV1.
> Tesla was able to ramp up production as fast as it did because they didn't need to run every decision past a union.
There are some smart CEOs and there are dumb ones. Who's to say that the incentives given to traditional management schemes are truly correct? Businesses fail all the time. Startups, in particular, fail all of the time, and there are no shortage of egregious examples of boneheaded management decisions, or of shortsighted shareholders. Pointing to a Tesla and Musk, or to an Apple and Jobs, is simply survivorship bias.
> You are responding to a normative, idealistic statement about universal values with your own slightly more concrete hypothetical.
What's your point? I obviously don't think the purpose of life is to maximize shareholder value. I'm merely illustrating where I find such idealism falls apart. I could be more specific, but I'm not trying to write a book.
You don't need to be a Nobel economist to know how people respond to incentives. An average family person doesn't want to risk their time, money, and health on helping to pivot Audi to a company that makes bleeding edge EVs. A company that is truly revolutionary has to focus as much energy as possible on delivering or some other company is going to do it first. That's why most successful startups are very cult-like. This comes at a cost to the worker and leads to scam companies like Theranos, but the alternative is that you're left behind.
> An average family person doesn't want to risk their time, money, and health on helping to pivot Audi to a company that makes bleeding edge EVs.
That article is from 2017. EVs were already more or less an accepted mainstream technology, even though certainly not the majority of the automotive market yet. You're making it sound like it's as difficult as it was for Tesla back in 2003- the union was simply demanding Audi management to respond to the needs of the market and expand its product line, for the betterment of the company and to protect their livelihoods by staying competitive. Audi building EVs does not require, as far as I know, a pivot.
Theranos is also a good example to mention. Perhaps if it was a worker-owned co-op or a union there, some sort of countervailing force against both managerial and investor incompetence, that fiasco could have been averted. Perhaps with a system in place to provide support against those powerful forces, and someone sympathetic to listen to whistleblowers, Ian Gibbons would still be alive.
It's all well and good to lionize Randian revolutionary lone geniuses, but the creative destruction they tend to wreak in their wake tends to fall upon a lot of the little people. And worse off, these geniuses at world-changing companies are few and far between, and far outnumbered by copycats and wannabes who cause more damage through imitation. We have checks and balances in our societal governance; why not likewise in our corporate governance?
I keep [half] joking to my managers that they should spend a few days on the work floor doing those jobs they argue so easy about. Not doing so makes it impossible to prioritize their own tasks properly. There is some child like joy in picking tasks by what they feel like doing.
As we've seen in recent cases, corporate management has become incentivized to choose the interests of the investors over the health of the company or the customer or their workers, making short-term decisions that look good in quarterly reports.
It seems that all the forms of collective control you listed are perfectly legal. If the majority of workers prefer workplaces like that then those places will thrive.
What you are implying though, is that the government forces all workplaces to conform to your desired control scheme. So fuller democracy equals government limiting choice, as long as it is your desired choice.
That's a bit like saying "Here we are in 1650 under an absolute monarchy. The people are the majority, they could topple our illegitimate hereditary government and make it a democracy, but they haven't done it yet because they certainly prefer things this way".
Not at all. If the people tried to topple the monarchy, they would be actively in conflict with the military. I am pretty sure you can start a co-op without risking conflict with the military.
Can you tell me the exact things the government is preventing people from doing in this case?
Another metaphor: "Linux is open and free, it can be a major desktop OS if everyone just switched to it, but because they haven't they obviously don't care for it."
Not to go off on a tangent but what you said is true, most people don't care about Linux...or Windows, or MacOS. They have a general apathy to whatever desktop OS they use, with a slight bias to whatever they used last. People just want to use the applications they want and need.
Perhaps the same statement would apply to workplace control. Most people have a general apathy to their workplace governance and only care about their pay and benefits.
I really don't know how you make people care about things, but compelling a change that people are free to make today by government force is last on my list of things to try.
My overall point is that there are many examples of the dominant players in a market being inferior in certain ways compared to more obscure choices, and there are different reasons for it. Cooperatives and alternative corporate governance models are simply less well-known, not unlike the average consumer hasn't even heard of Linux. They don't know the benefits involved in these alternate models. You can extend to many other categories where there are superior, but obscurer, alternatives that come with trade-offs.
There's also situations where dominant players make it difficult for smaller competitors to survive. In a loose analogy, Microsoft's monopolistic strategies in the '90s can be compared to the past decades' weakening of laws protecting unions.
Strengthening unions, or rather reversing the weakening of unions in this country, doesn't really require oppressive government force. That's in line with the misconception that considers America's sickly unions- who are an absolute paper tiger at this point in history- to have any considerable strength.
In terms of not crashing, fewer security issues, no telemetry, or having to pay money for it, sure. Point is it's an alternative that could potentially serve the needs of some users better than Windows does, but will likely never be considered by them just because it's almost unknown to the general public. I'm sure better examples exist.
Sure, but the point is that it's possible for a market to be dominated by a brand- or, in our original discussion, by a way of thinking or governing- that might be inferior to a lesser known choice.
There are a good number of hackers who would consider Linux superior to the dominant OS's, which is why I made that arbitrary comparison.
>I really don't know how you make people care about things
To follow your tangent, I actually did a little bit of not terribly formal research on this at one point (maybe about 15 years ago now), calling up a variety of people in different volunteer organizations and asking them about their background and motivation for their volunteer work.
Generally, the anecdotes I gathered all roughly corresponded with their volunteer work tying in in some way with other facets of their lives.
For example, a man who had received books in prison from a volunteer organization joined that organization after he got out because he believed in the value of what they were doing. A mom volunteered on an organization that arranged activities for kids, which hers participated in. That sort of thing.
My takeaway was not terribly revolutionary: you can't -make- someone care about things, but their circumstances will increase the chance that they will care about related things.
I don't know - there are cooperatives - it is not like you need to risk your life to work at one. Somehow they are not that popular. There are also partnerships - which are kind of close to cooperatives, when they employ only the partners and for example outsource office cleaning and stuff. In some industries they do pretty well - for example in law.
Why cooperatives do poorly? Maybe people usually are not very good at governance, that's understandable, you can have trade-offs - slightly worse pay for better working conditions, or better dignity. Does it work like this?
I don't think you have evidence to back this up. The reality is that cooperatives are very rare, so 99% of people don't even have to option to work for one. It's probably not even clear to the vast majority of workers that such a thing is even possible. This says nothing of the extreme aversion to anything even remotely resembling collectivism in the US.
Maybe they're less popular because they're less well-known, their benefits and downsides are as well, and so they're less likely to be considered by people incorporating a new business? Or maybe they're less advantageous to the founders so that's why they're simply not pursued?
I have seen economist claim that cooperatives tend to be pretty inflexible. Slack was a communication tool for what is now a failed gaming company. If the company was owned by game developers, artists, and story writers, how many of them would have voted to sack themselves and pursue a chat application?
In my limitied view, this seems to be one of the biggest obstacles. I'm heartened to see new cooperative investment funds coming online, like Evergreen Cooperatives (http://www.evgoh.com) and accelerators, like Start.coop (very new)
>If the majority of workers prefer workplaces like that then those places will thrive
The majority of workers have probably never even heard of worker coops and those that have probably imagine it to be related to socialism and therefore un-American.
>So fuller democracy equals government limiting choice, as long as it is your desired choice
So more democracy actually == more authoritarian. Astounding logic.
So people are dumb, they just need to listen to me.
That is the lazy way. If people are uniformed, we need to do more to inform them. People have power to choose where they work and where they spend their time and money. No one needs to come in and force Amazon into becoming a co-op. If top talent wants to work for co-ops and consumer prefer to get their good from co-ops, Amazon will adapt or die.
There is literally no one advocating for existing corporations to be converted into co-ops. People are saying there should be more co-ops in general, but that can be promoted by creating an environment that's more friendly and attractive to founding co-ops. Or educating people to promote the concept, which is largely unknown to the public. Bringing up the possibility of government force in the discussion is cheap scaremongering. It's like screaming "communism!" in a practical discussion about tax policy.
Though the concept of Amazon becoming a co-op is interesting. One wonders if a majority of Amazon employees organized and wanted that, if there would be even any legal avenue for them to do that. They probably wouldn't have enough shares to make that change from within.
This comes up a lot, nobody is literally chained to their desks. Democracy in the workplace comes from voting with your feet and taking another job at another company. It's not perfect, particularly for lower income people, but it's also not slavery and generally the arc of worker rights is improving through time.
You could make a case that some of the current anger in the united states is because COVID's destruction of the economy has removed that freedom to switch jobs (as the jobs have gone) demonstrating how important it is.
> It's not perfect, particularly for lower income people...
I don't think many minimum-wage retail or service workers can just "vote with their feet" and easily get another job, especially if you don't consider major changes in location and hours to be a non-starter.
For folks with kids, or who depend on public transit to get to work, "up and moving" isn't really an option. If you're one missed paycheck away from eviction, bankruptcy, or arrest due to missed fines or court fees then you can't play "hardball" with your employer.
Saying the arc of history improves overall cruelly glosses over the reality today for millions of Americans.
> Saying the arc of history improves overall cruelly glosses over the reality today for millions of Americans.
No it doesn't. Medical understanding and technology has gotten way better over the centuries, and people still die of things that could have been handled. Acknowledging progress doesn't imply perfection, but progress.
Let’s say I work at Kroger. I don’t like the way I’m treated, so I quit.
Now the remaining grocery stores I can work for owned by Albertsons or Amazon. What kind of choice is that?
Pick any other industry and you’re likely to find similar problems.
It would be really interesting to see what mandatory democratic corporate governance might look like.
Or, perhaps, fixing union regulations so that unions don’t have a bunch of downsides for the employee or other regulatory issues that seem to have directly led to their decline.
The fundamental problem is that there’s less demand for unskilled US labor than there are unskilled US laborers looking for work. Fix that, and most of the issues people are worried about go away.
That likely has to be solved at the federal or international government level.
I don't think, "we've mostly gotten rid of actual leg irons" is the paen to worker's rights you think it is. To the extent slavery was outlawed, that happened 150 years ago. In many ways, things have gotten worse for the average worker since that era. (If you don't believe me, read Lincoln himself. [1])
Fair conditions grow out of equal power. But a fundamental problem with managerialist capitalism is an imbalance of power that will never be solved with vote-with-your-feet slogans. You have one job. A CEO has tens, hundreds, thousands of employees. It's always easier for a boss to fuck you over than it is for you to push back. Individual action is not enough to fix that.
Personally, I'd love it if everyone could easily vote with their feet. I think there's more overlap between certain libertarian and socialist visions of the economy than most people realize. In our current system, there's a lot of factors that prevent people from voting with their feet: healthcare, location, switching costs, and availability of jobs being chief among them, but also newer phenomena like non-compete contracts.
Yes there are other states that have similar limits, and many other states that don't.
>and in all of them if they are determined to be unreasonable in court
That's a tautology. A court can refuse to enforce any contract for many reasons. The problem is that what may be considered unreasonable in California might not be in Georgia.
It's also not super helpful for someone who can't afford a lawyer to fight it. Or for someone who can't find another job because companies don't want to deal with the hassle.
Courts tend to take a dim view of well-monied people bullying the not-monied in courts. Larger companies are well aware of this, so are their employees, and the companies get sued constantly by those employees, and the companies usually settle because it's cheaper.
Don't worry, it isn't true in theory either. Courts don't give a shit about that sort of high-minded honorableness.
Why, the existence of anti-SLAPP laws comes directly out of courts not caring how they're weaponized by well-monied people bullying not-monied people. That's literally the point of anti-SLAPP laws.
GP's claim makes no sense with even the dimmest awareness of the court system.
> it's so completely untrue from a practical perspective
Poor people successfully sue businesses ALL THE TIME.
Besides, just last week a friend of mine told me that the former boss of one of his employees threatened a lawsuit over a non-compete agreement. He simply told the former boss "see ya in court and you'll be paying my legal bill". That was the end of that.
Not only are most of these just bluster, it's not profitable to sue poor people, since poor people don't have money.
I think the cause and the effect is reversed. There is more money for investment now than ever before (due to an aging population, and increased inequality) which leads to both a low/zero interest rate, and lots of money for PE.
If it was an artificially low interest rate we'd see wage inflation, as opposed to just asset inflation.
Interest rates are artificial. IMHO they are currently way too low. I dont even think the absolute rate is what affects the economy, its rate of change in interest rates that causes change. Declining rates stimulate the economy while rising ones act as a brake. The absolute level of the rates determine where money flows and inversely affects the price of big things like housing and cars. Low rates lead to inequality and hardship. These are just thoughts and observations, I would love to build a good mathematical model.
Nominal interest rates are artificial. Real interest rates (nominal rates - inflation) are not. If central banks set nominal interest rates too low you get inflation which negates the purchasing power of the borrowed money. That's what the grandparent poster was alluding to.
(The mathematical model - and the proof - for this is taught in most introductory macroeconomics courses. So is monetarism, which is the "declining rates = stimulus" that you mention.)
It's been a persistent question why the super-low nominal interest rates that central banks have set for the last decade haven't resulted in consumer inflation, and there's no consensus among experts for it. My personal theory is that it comes from the entry of China and other large developing nations into the world economy, which a.) has dramatically lowered the price of labor-intensive consumer manufacturing, offsetting much of the inflation caused by the large money supply and b.) changed the mix of savers in the world economy; Chinese people are much more in the habit of saving large fractions of their income than Americans are, which leads to a glut of savings, which lowers the real interest rate.
I think you're right that low interest rates boost wealth inequality due to rising asset prices, but they also reduce income equality because of the tight labor market.
And by artificially low I meant below the natural interest rate or NAIRU.
It's just a natural product of capitalism[1]. When you can buy a chunk of a business and own that chunk of its profits, you can use those profits to buy a larger chunk of the business, repeat ad nauseum, until you have so much money that your needs for more profit aren't satisfied by any one business, but you have enough money to perform multi-business maneuvers. Higher interest rates might make some of these maneuvers less possible in the short term, but that would just delay the problem until the wealthiest capital-owners accumulate enough money that they can put forth more collateral to get better loans.
[1] By capitalism I mean private ownership specifically, not the usual HN definition of something something markets something something competition.
Some consolidation is natural, but a huge part is caused by mergers and acquisitions (M&A) fulled by Private Equity. The M&A benefits the shareholders of participating companies at the expense of consumers, employees, and other companies.