The curse of bigness refers to the negative effects that can arise when a company or organization becomes too large and powerful. This concept is often associated with monopolies and the concentration of economic power in the hands of a few dominant corporations. When a company becomes too big, it can stifle competition, limit consumer choice, and exert undue influence on governments and regulators. This can lead to a lack of innovation and higher prices for consumers. Additionally, large companies may engage in anti-competitive practices, such as predatory pricing or exclusive contracts, which further harm smaller competitors and limit market competition. The curse of bigness also extends beyond the economic realm.
The curse of bigness also extends beyond the economic realm. Large corporations often have significant political influence, which can be used to shape public policy in their favor. This can lead to regulatory capture, where government agencies are beholden to the interests of large corporations rather than acting in the best interest of the public.
A call to save democracy by battling monopolies
Benjamin C. Waterhouse is an associate professor of history at the University of North Carolina at Chapel Hill. He is the author of “Lobbying America: The Politics of Business From Nixon to NAFTA” and “The Land of Enterprise: A Business History of the United States.”
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Two decades into the 21st century, capitalism is huge and getting huger. Three-quarters of all industries became more concentrated between 1997 and 2012. About 10 pharmaceutical companies control the production and sale of the world’s medicine; three chemical firms dominate the supply of seeds and pesticides, and thus global agriculture; and one combined corporation produces nearly every non-craft beer for sale on the planet. At the same time, tech giants Facebook, Google and Apple dominate their markets, controlling not just commerce but access to news and our personal information.
As Tim Wu argues in “The Curse of Bigness: Antitrust in the New Gilded Age,” global economic concentration is now at levels unseen in more than a century — since the early days of industrial capitalism. A policy advocate and law professor at Columbia University, perhaps best known for coining the term “net neutrality” in 2003, Wu offers a vital diagnosis: America has abandoned its rich tradition of anti-monopoly, or antitrust, law. And while the very term “antitrust” may strike many as dreadfully dry, Wu manages to make this brisk and impressively readable overview of the subject (the entire text runs about 140 pages) vivid and compelling.
AdvertisementAmerica’s antitrust history began with the Sherman Antitrust Act of 1890, passed “as a reaction to the rising power of monopoly trusts.” The law lay dormant for a decade until “activated” by President Theodore Roosevelt against J.P. Morgan’s Northern Securities railroad company and John Rockefeller’s Standard Oil. Despite his trustbuster image, Wu argues, Roosevelt had little problem with bigness itself. He even offered Rockefeller the chance to keep his monopoly as a public trust, subject to government supervision. What’s more, during his campaign to reclaim the White House in 1912, Roosevelt argued (unsuccessfully) for “regulated monopoly” — a system in which “commerce would be controlled by a small group of monopolists, who would be, in turn, controlled by government.” It was a model later implemented by Italy and Germany in the 1930s.
The standout figure in antitrust was jurist Louis Brandeis, the architect of the vision that did triumph in 1912: Woodrow Wilson’s “regulated competition.” Born in Louisville to immigrant, small-business-owning parents, Brandeis cut his legal teeth defending small-business clients in Boston and emerged as a leading opponent of monopolies in the two decades before Wilson named him to the Supreme Court in 1916. For Brandeis, industrial size was the chief problem. Large companies, whether strictly monopolies or not, thwarted individual initiative, restricted competition and thus innovation, and used their size to obscure economic inefficiencies. Most important, large corporations could not be reconciled with democracy and liberty, either for small businesses trying to compete or workers out to make a living. The biggest threat, Brandeis wrote in 1914, was “the suppression of individual liberty, indeed of manhood itself.”
The view that fighting monopoly meant defending democracy triumphed after World War II with what Wu calls “Peak Antitrust.” Democratic Sen. Estes Kefauver minced no words linking a competitive economy with political freedom. “Through monopolistic mergers the people are losing power to direct their own economic welfare,” he said. Putting such power in too few hands, he continued, “results in a Fascist state or the nationalization of industries and thereafter a Socialist or Communist state.” Passed in 1950, his Anti-Merger Act gave the Justice Department and the Federal Trade Commission new authority to prevent anti-competitive mergers, nipping industrial giants in the bud.
America’s antitrust history began with the Sherman Antitrust Act of 1890, passed “as a reaction to the rising power of monopoly trusts.” The law lay dormant for a decade until “activated” by President Theodore Roosevelt against J.P. Morgan’s Northern Securities railroad company and John Rockefeller’s Standard Oil. Despite his trustbuster image, Wu argues, Roosevelt had little problem with bigness itself. He even offered Rockefeller the chance to keep his monopoly as a public trust, subject to government supervision. What’s more, during his campaign to reclaim the White House in 1912, Roosevelt argued (unsuccessfully) for “regulated monopoly” — a system in which “commerce would be controlled by a small group of monopolists, who would be, in turn, controlled by government.” It was a model later implemented by Italy and Germany in the 1930s.
Furthermore, the concentration of economic power in the hands of a few corporations can have negative social and environmental consequences. Large companies may prioritize short-term profits over long-term sustainability, leading to environmental degradation and social inequalities. They may also exploit workers and suppliers, driving down wages and working conditions. In response to the curse of bigness, policymakers and regulators have implemented various measures to promote competition and prevent excessive concentration of economic power. These include antitrust laws, which aim to prevent monopolies and promote fair competition, as well as regulations to protect consumers and workers. However, enforcing these measures can be challenging, particularly when dealing with large and politically influential corporations. In conclusion, the curse of bigness highlights the potential dangers that arise when companies become too large and powerful. It is essential for policymakers and regulators to remain vigilant and take proactive measures to promote competition, protect consumers, and ensure a level playing field for all market participants. By doing so, they can mitigate the negative effects of excessive concentration of economic power and foster a more inclusive and sustainable economy..
Reviews for "The Challenges of Cultural Diversity in Large Organizations"
1. Ethan - 1/5 stars - I found "The Curse of Bigness" to be incredibly dry and boring. The author's writing style was not engaging at all, and I struggled to stay interested throughout the entire book. It felt like I was reading a long, drawn-out academic essay rather than an accessible piece of non-fiction. Additionally, I found the arguments presented to be unconvincing and lacking in depth. Overall, I was very disappointed with this book and would not recommend it to others.
2. Olivia - 2/5 stars - While I appreciate the importance of discussing the issue of bigness in the corporate world, "The Curse of Bigness" failed to captivate me. The author's writing was heavy with economic jargon and lacked a clear, concise presentation of ideas. I believe the book could have benefited from more real-life examples and practical solutions, as it often felt too abstract and disconnected from reality. Ultimately, I was left feeling unsatisfied and underwhelmed by this book.
3. David - 2/5 stars - As someone who is generally interested in economic and political topics, I had high hopes for "The Curse of Bigness." However, I found the book to be overly repetitive and lacking in originality. The author seemed to rehash the same arguments and ideas throughout the entire book without offering any new insights or perspectives. Additionally, the writing style was convoluted and made it difficult to grasp the author's main points. Overall, I felt like I wasted my time reading this book and would not recommend it to others.
4. Sarah - 2/5 stars - "The Curse of Bigness" was a disappointment for me. I found the book to be excessively dense and inaccessible, making it hard to fully comprehend the author's arguments. I was hoping for a more balanced examination of the effects of bigness, but the book seemed to focus primarily on the negative aspects without considering potential benefits. Furthermore, the author's writing style lacked clarity and often left me confused. Overall, I was not impressed with this book and would caution others before diving into it.