Why Socialists Should Be Wary of Antitrust
Last week Joe Biden tweetedLet’s be clear: capitalism without competition is not capitalism. It is exploitation.
It would be too much to expect this rather obscure politician to understand, let alone approve, the classic Marxist analysis of profit from the exploitation of workers – they produce more in value for their employer than they are paid in. salary. But the remark, in all its naivety, captures a widespread belief in liberal political circles that monopoly is at the heart of our economic problems, from crappy jobs to crappy wages and benefits. I am not convinced.
From the introduction to economics I learned in college – which is true a long time ago – two essential characteristics of monopolized markets were high prices and tight supply. These characteristics were not at all visible in the US economy until the pandemic began to disrupt supply chains, leading to a shortage of supplies in some sectors in the face of pent-up demand, demand supercharged by stimulus checks.
Despite this, shortages and price spikes affect only a few sectors, like new cars and wood. They have not yet spread throughout the economy and there is no indication that they are about to do so. They are not the product of long-term monopolization. For most of the past forty years inflation has been fairly low – largely because the working class was crushed as the 1970s turned into the 1980s, and because shortages were rare.
The giants that people point to as proof of our monopoly problem include Amazon, Google, and Facebook. Amazon, like Walmart before it, is known for its low prices that crush its competitors. (The workers too.) This is not standard monopoly behavior. Google and Facebook dominate their domains, but most of their “products” are free. Yes, that means ‘you are the product’ as the saying goes, but what kind of improvement would it be if busted Googles and Facebooks billed for their services or maintained the same business model of monetizing the identity of the company? user than the originals?
It is also not clear how the introduction of competition would improve the quality of service. One of Facebook’s lures, for those who are lured, nearly three billion users at most recent countis that there are so many people on it. It facilitates communication. Dividing it into competing services would render an AT&T telephony customer unable to contact a Deutsche Telekom subscriber.
Behind antitrust lies a faith in competition as a positive good. As socialists we should oppose this. We already have too much competitive individualism in this society, and we no longer need it. We need solidarity. Stimulating the war of each against all is not the way to achieve it.
A better way to deal with greatness is to regulate the behemoths and encourage the growth of unions. It would do more to improve working conditions at Amazon than to turn it into four or twenty little Amazons. As political economist Sam Gindin pointed out in a interview on my radio show, the deregulation movement of the 1970s and 1980s was a war against regulated oligopolies, and it was accompanied by the dismantling of unions, cuts in wages and job losses. It could be a harbinger of life under the breakup monopoly.
Why is antitrust gaining the attention of liberals these days? In his book on the history of American corporate governance, the professor of law Marc Roe notes that Franklin Roosevelt saw it as a war against “private” socialism that could ward off “government” socialism. We can see something similar now. With socialism decently poll, the socialists who find their way into the Democratic Party and the business class in disrepute with a large part of the population – Gallup Reports that 73 percent of the public is somewhat or very dissatisfied with big business, compared to 48 percent in 2001 – pursuing antitrust may be a campaign to restore the prestige of capitalism itself. Making small business the emblem of commerce is a classic bourgeois self-defense strategy.
Small is not magic. Vincent Carosso finishes his huge book on the Morgan banking family, citing an anonymous socialist refusing to curse Peak Morgan, JP, on his death: “We regret that he cannot live longer, to further organize the productive forces of the world, because he has proven in practice what we theoretically argue that competition is not essential to trade and development. It’s a feeling that deserves to be reclaimed.