Principles over Party

With a slow news week, mostly focused on the Mueller Report, I thought it would be good to tackle a more broad topic. A topic that effects all of us whether we know it or not. The topic of Monopolies. No, I’m not referring to a game where you collect money as you pass go or have a “get out a jail free” card. I’m talking about a political game, a game with few winners and a ton of losers.

In case you don’t know what a monopoly is, monopolies occur when one entity becomes the superior and exclusive supplier of a particular product or service. Historically, the creation of a monopoly tends to lead to a rise in prices, a decrease in quality and a hold on employee wages. Another common aspect to monopolies is their vast resources when it comes to swaying public policy through lobbying. This then leads to a cornering of the market that ultimately undermines market competition and individual freedom.

Many of our Founding Fathers were very concerned about government sanctioned monopolies. It is said a contributing factor to the refusal of George Mason to sign the U.S. Constitution was the lack of an anti-monopoly clause. Thomas Jefferson was another very out spoken opponent to government monopolies and advocated that freedom from government monopolies be on par with all other rights in the Bill of Rights.

Both Thomas Jefferson and George Mason drew their fear of government granted monopolies from their English backings. It was common for Kings and Queens of England to grant monopolies to their friends or to the highest bidder. When the original colonist came to America, they brought the idea of being free from government granted monopolies with them. In fact, the Boston Tea party was not just about a tax on tea. It was about a resistance to the East India Company’s trade monopoly on the tea industry.

Ultimately, the Constitution would pass without a specific anti-monopolies clause. Instead, the 14th Amendment would limit Congress to granting monopolies only in the areas of patent and copyright protections. The 14th Amendment would also ban Class Legislation, meaning any legislation that singles out groups/individuals or classes of people and grants them special privileges or imposes on them special burdens or sanctions.

However, the battle against government granted monopolies wouldn’t end there. In response to a 19th century rise of big business like the Steel Industry, Standard Oil, American Tobacco and the American Telephone & Telegraph Company (AT&T), the Sherman Antitrust Act of 1890 and the Clayton Act of 1914 would be introduced as early examples of capitalistic “competition laws” that were designed to ensure a competitive economic field. The idea behind both was to more strictly regulate business.

Unfortunately, one thing you can always rely on is, with an increase in power comes an increase in corruption. The government would now pick and choose between “good” monopolies and “bad” monopolies. And while the case can be made that some monopolies can be “good”, government should never have the power to pick and choose winners and losers.

Regardless of the attempts of government to regulate the growth of monopolies, many still occurred and continue to occur today. Typically, Monopolies occur in two different forms: private monopolies and government funded and/or sanctioned monopolies. Although in reality, a private monopoly could not exists without some form of government protections or interference. This is done through subsidies or through costly restrictions imposed on possible competition.

One of the best examples of a government sanctioned monopoly is public utility services. Public utility services such as water, natural gas and electricity are one of the largest government sanctioned monopolies in existence today. These industries are prime examples of a government granting exclusive rights to one company, while making it impossible for any other type of competition to enter the market. Residents are typically given one choice for their energy and water/sewage needs. Don’t like it? Too bad for you. If you choose not to sign up with one of these companies, some local government may even fine you, or worse. It is a prime example of a coercive monopoly, one where there is no freedom of choice.

Another great example of a coercive government granted monopoly is the Two-Party System. Through the Two-Party System, two political parties dominate the government, effectively keeping any other competitive party out of the picture. What most people don’t realize is, the Republican Party and the Democratic Party are not part of the government. They are private corporations with a stranglehold over our elections, our politicians and our political system. They control the election process by controlling who gets invited to the debates, controlling who gets to vote in the primaries, and thus controlling the two choices left for the rest of the population to vote for in a general election.

Let’s not forget to mention the Federal Reserve. One of the most powerful government sanctioned monopolies. One with sole power over the printing of our money. The Fed’s power is so vast, that it can have drastic effects on our economy, almost instantly, just by making decisions about the money supply and interest rates. Of course, this is without any say of the American people. In all cases, the use of government granted monopolies has been used to limit the choices of a supposed “free” society.

Eventually, a trend toward fear of government granted power would switch to a fear of private concentrations of economic power. The “old school” private monopolies of industries like AT&T, the Steel Industry, and Standard Oil might not exist any longer, but we are far from being free of large concentrations of economic power. In fact, two-thirds of all corporations have become more concentrated since the 1990s. More and more every year corporations are working to further concentrate their power, thus leading to an increase in their ability to raise prices, limit choices, and lower wages. And, let’s not forget millions of dollars in extra profit to lobby the government; because with an increase in market power comes an increase in political power.

With this increase in market power also comes the decrease in productivity growth, leading to a sluggish economy and a huge growth in inequality. In fact, any type of monopoly or vast concentrations of power becomes a driver of inequality as profits are concentrated into the hands of a few. The rest of us are then left to live with the consequences of sky-high prices and limited choices.

With limited prescription drug providers, limited hospital choices, and limited insurance options, it should be no surprise why our healthcare system is completely unaffordable for the majority of Americans. And while health care is a hot political topic today, no one seems to really want to address the real issue affecting costs, the ever growing and expanding hospital, insurance, and pharmaceutical monopolies.

In addition to high medical costs, Americans are also seeing their cable and internet bills climb higher and higher as the telecommunications networks, once broken up under the old AT&T monopoly, begin to merger together once again. The worst concentration of power yet, might be the increasing control over our media and the flow of information from one person to the next, with companies concentrating their power like Facebook, AT&T/Time Warner, Disney and Verizon. Sadly, a majority of our media is controlled by only a handful of large parent companies just like these. Banks are another sector of the economy that is increasingly consolidating their power and limiting choices.

Most people also don’t realize how much these large corporations are dependent upon government handouts either. Handouts that come in the form of publicly funded research, subsidies, favorable legislation and bailouts. And while the government doesn’t seem to want to do anything about it, movements like the Tea Party and Occupy Wall Street, have started to at least point the finger in the right direction.

When it comes to our three principles, Respects Human Life, Abides by the Constitution, and Helps those who need it most, Monopolies, private or government sanctioned, get a HARD FAIL. The pursuit of power and profit rarely has room for respect for life or to help those in need. In fact, it takes advantage of those in need the most. The constitution does not specifically contain an anti-monopolies clause, but many of our Founding Fathers were explicitly against it and advocated for guards and protections against the formation of large concentrations of power. The Sherman Act and Clayton Act granted congress the power and legal guidelines to dismantle these large concentrations of power, but they either refuse to do their job or they are complicit in the process. After all, the kick backs are pretty lucrative.

I could probably go on forever about the problems and dangers of monopolies, but instead, I will end it here with the words of Supreme Court Justice Louis Brandeis..

“We may have democracy, or we may have wealth concentrations in the hands of a few, but we cannot have both.”

I am grateful for the opportunity to share these thoughts with the world. Should you find yourself here, please feel free to share your thoughts and opinions as part of an open dialogue aimed at gaining a better understanding of ourselves and of one another.