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?