For the past several months, I’ve been researching lost knowledge. I’ve long been fascinated by when, why, and how we lost the understanding that our economy and how it’s organized is intimately connected to, and often dictates, the amount of freedom and liberty we can expect from our government. I’ve written about the connection between a highly-concentrated economy and an increasingly authoritarian government here a few times, because I believe our ability to reclaim that knowledge and act on it is crucial to the survival of a republic governed by and responsive to its people.
Those months of research become this Democracy Journal essay, which tells the story of how the relationship between monopolies and Hitler’s fascist regime in Germany deeply influenced American trustbusting for generations — and how, a half-century ago, we lost our way and returned corporate monopolies to power. It’s long: 7,000 or so words. I wrote that much because I think the story of how Americans came to understand the links between monopolies and fascism, and how that collective knowledge was stolen from us, is critical if we are going to again recognize the grave threat monopoly power poses to both our economy and our democracy today. Let me explain.
Today, corporate power dominates the economy. Because so much of our modern lives happens online — communication, shopping, entertainment, on and on — the technology giants that dominate our online spaces wield immense power over how we work, shop, and play. Out in the physical world, waves of mergers, private equity roll ups, and monopoly tactics have left us with a deeply concentrated economy. Our grocery stores, our pharmacies, our hospitals, farms, phones, the ways we travel, the utility companies we pay every month, the news and television and movies we watch; the list of monopolized industries is shockingly long.
For many years in America, this concentration has taken place under governments that have presented themselves as reasonable caretakers of our republic, by word if not always by deed. For most folks, there has been a cognitive disconnect between the realities of our increasingly-monopolized economy and our system of government. Yes, the economy has fallen into fewer and fewer private hands and our ability to make ends meet has suffered, but on the surface, our political system felt stable. We might not like one politician or another, or one party or the way they governed, but elections have continued more or less as normal, and no matter what your political beliefs were or what direction you thought the country was heading in, good or bad, it always felt like you were one election away from getting the thing turned around.
The truth is that for the past half-century, we have been locked in a kind of political and economic free fall, in which officials from both political parties have turned over the keys to the economy to corporate giants. In doing so, they have brought government and industry closer and closer together; today, in most government offices, you’ll find two former industry executives — one lobbyist and another government employee, be it a regulator or an elected official.
This symbiosis between government and industry warped government’s duties and goals. Rather than serving the people, government has come to serve corporate interests, shareholders, and executives. Increasingly, elected leaders view any threat to corporate interests as a threat to government itself. Democratic values fade, and the desires of political leaders and corporate power become fully aligned: Dominate at all costs.
For much of the 20th Century, from the rise of Nazi Germany through the 1970s, we understood that a monopolized economy fostered this alignment between industry and government, where maintaining power and control mattered far more than preserving economic and political democracy. So we fought monopolies for multiple generations, until the late 1970s, when corporate interests used the stagflation crisis to reclaim power, ushering in the Reagan Administration and enmeshing itself into the government’s halls of power.
If our history of resisting both fascism and monopoly rule is interesting to you, I think you’ll appreciate my Democracy Journal essay. It’s worth your time. In future WSR posts on monopolies and fascism, I’ll share snippets of what I learned during my research about American corporations’ long embrace of fascism and authoritarianism — and how those sentiments helped lead to our increasingly authoritarian federal government today.
Excellent historical perspective. I think monopolies are responsible, at least in part, for the income inequality we have in the U.S.