728x90 AdSpace

Latest News
October 2, 2015

Big Business Is Economic Cancer, Part II

Part I of this series ended with an example of what Big Business does best: corporate blackmail:
U.S. Steel Canada Inc. is threatening to cease operations in Canada by the end of the year if an Ontario Superior Court judge rejects its request to stop paying municipal taxes, halt payments into pension funds, and cut off health care and other benefits to 20,000 retirees and their dependents. [emphasis mine]
Such corporate blackmail and welfare, in smaller and larger forms, occurs hundreds of times every year, across the Western world, with dozens if not hundreds of these corporate fronts robbing from our governments (and thus us). How did we ever get to this point?
Part of the answer was provided in Part I: via our corrupt governments refusing to enforce our (strong) anti-trust laws, which are supposed to prevent corporations from getting “too large”. Indeed, one of the foremost reasons for creating these “anti-trust laws” is because our ancestors understood one of the fundamental equations of economics:
Big Business = corruption
This was one of the two, prime motives for legislating these anti-trust laws, in the first place. Why is Big Business corrupt? Because it can be corrupt. If you provide “temptation” (i.e. the potential for ill-gotten gains) to unscrupulous people, they will succumb to that temptation. One of the principal, inherent evils of large corporations is that because of their enormous size these corporate entities have more than enough financial resources to buy off politicians, buy off regulators, and (as we see today) buy off entire governments.
However, in facilitating this corruption, our puppet governments have done much, much more than merely cease to enforce our anti-trust laws. In fact they have done something far more heinous: all of the so-called “free trade” deals which they have imposed upon us, generally against the will of our populations.
It is beyond the scope of this piece to provide a comprehensive essay on “free trade”. Suffice it to say that what we have bears absolutely no resemblance at all to real “free trade”, because in order to have “free trade” we must have fair trade – and there is absolutely nothing even remotely “fair” about the system-of-oppression which has been imposed upon us.
“Free trade” (as a principle of economics) can only work if all nations which are a part of this agreement operate on a level playing field: equal wages, equal working conditions, equal tax structures, etc. If all of these economic parameters/conditions are not equalized between trading partners then we obviously have an “unequal” playing field (i.e. it’s possible to cheat), and we thus don’t have free trade.
This is what we have today. The Oligarchs who own/control all Big Business have gotten our corrupt governments to erase all of our borders (for the purposes of trade) while doing less-than-nothing to create a level playing field. What these corrupt politicians, media drones, and thieving Oligarchs call “free trade” is simply organized corruption.
How does it work? Simple. Free trade – without any uniform standards – is a permanent race-to-the-bottom. If the Oligarchs can’t get the “best deal” (i.e. the most corporate welfare) for their corporate front in one jurisdiction (via the blackmail shown above), then they will just leave, move to a jurisdiction which will give them all the welfare they demand, and then that same corporation will DUMP its subsidized goods into the economy it just fled.
Understand the full extent of this evil:
1) They harm the economy they are leaving, by taking away jobs and other economic activity
2) They harm the economy they are entering, by blood-sucking it for extreme amounts of welfare.
3) They harm the economy they left a second time by selling their (heavily) subsidized goods back into that economy, preventing that economy from creating a new business to replace the corporation which deserted them.

Lose, lose, lose. That’s free trade, or at least the alleged “free trade” which we have. But that’s only a small part of the evil of this so-called free trade. Paradoxically (to those lacking an understanding of economics) “free trade” kills competition – when combined with the failure to enforce anti-trust laws.
It’s like this: You erase borders for the purpose of trade, creating a much larger overall “market” to which these mega-corporations have access. This allows the mega-corporations (i.e. oligopolies) to get much, much larger (and much, much more corrupt), while they strangle any/all Small Business trying to compete against them, because the “deck” is already ridiculously stacked in favor of Big Business. This brings us to another ‘equation’ of our current, corrupt paradigm:
Free trade = no competition
Why is “competition” continually stressed in this analysis? Several reasons. First there are the positive reasons. Competition maximizes employment. Competition maximizes economic activity. Because of those two reasons, competition maximizes government revenues. And with “maximum revenues”, not only will our governments be solvent, they can “afford” the necessary social programs which our current Corrupt Traitors now all claim are “unaffordable”. Yes, if you hand $trillions and $trillions of corporate welfare to Big Business every year, there will be no money left over for people.
The second reason why promoting competition at every juncture is imperative is because if competition is “strong” within any economy, this will make it much more difficult for corporations to get too large. In other words, in a perfectly competitive economy, we would not need anti-trust laws, because “competition” itself would permanently prevent any business from getting too large.
Of course “perfect competition” is just a pipe-dream, which is why anti-trust laws (and enforcing those laws) will always be necessary. But if we simply enhance competition, and once again properly/rigorously enforce our anti-trust laws, we can return to having sane, honest, prosperous economies.
Note also that with economies filled with competitive Small Business, this game of infinite corporate welfare would instantly come to an end. A small business can make no “threats” against governments, because it lacks the corporate/financial leverage to make good on any such threats.
If a small business demands that a government provide it with exorbitant quantities of corporate welfare, or it will “leave and go somewhere else”, the response of government is automatic: “bye-bye.” 
When a small business leaves one jurisdiction (or simply folds), another small business rises up to take its place, because unlike Big Business, small businesses (as previously noted) cannot possibly have any detrimental impact on “competition” (i.e. the ability of a new business to enter that industry).
Big Business kills competition.
Competition kills Big Business.
Obviously one of these economic dynamics is much healthier than the other. Competition is the very essence of any healthy economic system. Robust competition ensures healthy, prosperous, honest economies – and Big Business kills that. We need governments which promote competition to in order to lessen the evils of Big Business, not governments which serve Big Business, and thus exterminate competition.
What is “cancer”? In general terms; cancer is a disease which multiplies, and relentlessly eats away at an organism (or system), literally to the death of that organism. This describes Big Business perfectly. It is multiplying, and relentlessly exterminating competition and cannibalizing our economies as it multiplies.
We know what we need. We need economies filled with benign Small Business, to put people back to work, re-fill the tax coffers of our governments, and restore honesty, competition, and prosperity to our economies.
We know what we have. We have Western economies and governments which are now totally ‘under the thumb’ of the ultra-wealthy Oligarchs who control the vast majority of Big Business. As a result, we also have totally corrupt governments (bought-off by Big Business) and economies which have (literally) been hollowed-out by these corporate thieves to the point of bankruptcy.

The question then becomes: how do we get from what we “have” to what we “need”? This will be the subject matter of the third, and concluding installment in this series. Cancer can be beaten.
Courtesy Jeff Nielson for Sprott Money News  

The views and opinions expressed herein are the author's own, and do not necessarily reflect those of EconMatters. © EconMatters All Rights Reserved | Facebook | Twitter | Free Email | Kindle

  • Blogger Comments
  • Facebook Comments
Item Reviewed: Big Business Is Economic Cancer, Part II Rating: 5 Reviewed By: EconMatters