Business

States shush corporate critics

From factory farms to home foreclosures, state governments are helping hide corporate wrongdoing

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States shush corporate criticsWorkers at the Perdue Farms Inc. processing plant prepare cleaned and gutted chickens for packaging at the plant in Accomac, Va. (Credit: AP/J. Scott Applewhite)

You can’t be outraged by — or fight back against — what you don’t know. At least that seems to be the theory behind a spate of new government-backed efforts to help corporations prevent inconvenient information from ever reaching the public domain. In states across the country, as in Washington, D.C., lawmakers are helping companies keep secrets in everything from factory farming to fossil fuel exploration to home foreclosures.

In five states, for instance, so-called Ag Gag laws are now on the books. Iowa just passed legislation that “criminalizes investigative journalists and animal protection advocates who take entry-level jobs at factory farms in order to document the rampant food safety and animal welfare abuses within,” according to the Atlantic’s Cody Carlson.

The impetus for such laws is obvious: After a series of damning videos of factory farms abusing animals, Big Ag faced a consumer backlash. But rather than make its facilities more humane, it has opted to spend its cash on lobbyists and court cases aimed at preventing the public from ever seeing the atrocities in the first place. Accomplishing that means pioneering new legal theories that threaten to set dangerous new precedents curtailing some of the most basic First Amendment freedoms we take for granted.

Over in the world of energy, it’s much the same thing. Last month in Pennsylvania, the oil and gas industry successfully lobbied state legislators to ban physicians from telling patients what toxic fracking chemicals they may have been exposed to. As Mother Jones’ Kate Sheppard reports, “While companies must disclose the identity and amount of any chemicals used in fracking fluids to any health professional that requests that information … the new bill requires those health professionals to sign a confidentiality agreement stating that they will not disclose that information to anyone else — not even the person they’re trying to treat.”

At least doctors in Pennsylvania get to see some basic information about the industry’s toxic brew, which is more than health professionals in other states have been able to say in recent years. Indeed, in 2008, an emergency room nurse nearly died after being exposed to a company’s fracking chemicals and, according to High Country News, the company cited a trade secrets law in “refus(ing) to provide more specific information (about the chemicals) to the hospital once she fell ill.” That left her “intensive-care doctor to guess what to do as he tried to keep her alive.” This possibility still exists in states that still do not fully mandate disclosure of fracking chemicals.

In the housing sector, you probably assume you at least have a right to see relevant documents related to your imminent home foreclosure. After all, with that basic information, you might stand a chance of going to court and preventing a bank from illegally throwing you out of your home. Yet, if you live in Colorado, your assumption about being able to see such information would be wrong.

With details of the financial industry’s document shredding and robo-signing scandals still leaking out, the Denver Post reports that Republicans in the Legislature there voted down a bill simply “requiring that lenders prove their right to foreclose on a home.” That means Colorado remains the only state to “allow for a foreclosure without the lender first proving” it has the legal right to repossess a person’s domicile. With the GOP so successfully defeating the reform proposal in the face of public outrage at bank fraud, look for the financial industry to try to get state governments to set the same “no doc foreclosure” precedent all over the country.

Then there are corporate taxes, perhaps the most egregious area in which the government uses its power to shield politically significant information. As the Institute on Taxation and Economic Policy reports, “neither the SEC nor most state governments require corporations to release detailed information on their state corporate tax payments” — which deliberately makes it “hard to identify which corporations are not paying their fair share at the state level.” At the federal level, after corporate tax disclosure laws made it onto the books in the 19th and early 20th centuries, they were removed. Bloomberg News notes that the Financial Accounting Standards Board has the power to “make the income-tax returns of all companies with shares traded on U.S. stock markets available to the public,” but that it has refused — even in the wake of reports proving that many of the most profitable corporations are now paying no tax at all in America’s loophole-ridden tax system. The result is that the government empowers corporate management to prevent both companies’ shareholder-owners and the public at large from ever evaluating a firm’s tax compliance — or lack thereof.

Each of these examples — and the many others like them — are closely related to the concurrent corporate efforts to prevent labeling mandates. And as disparate as such examples may seem, they each prove that 21st-century capitalism and old-school Orwellian control are not polar opposites, as they are often portrayed. On the contrary, those two political forces now often coexist in a symbiotic relationship — one that uses state power to keep politically charged information hidden. The theory beneath the calculation is simple: Public ignorance equals corporate bliss.

With protest movements rising and the possibility of widespread social unrest a real possibility, we should expect that calculation to be more prevalent in our politics than ever.

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David Sirota

David Sirota is a best-selling author of the new book "Back to Our Future: How the 1980s Explain the World We Live In Now." He hosts the morning show on AM760 in Colorado. E-mail him at ds@davidsirota.com, follow him on Twitter @davidsirota or visit his website at www.davidsirota.com.

AT&T agrees to drop bid for T-Mobile

Government objections put an end to planned $39 billion acquisition

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LOS ANGELES (AP) — AT&T Inc. said Monday that it is ending its $39 billion bid to buy T-Mobile USA after facing fierce government objections.

The cellphone giant said that the actions of the government to block the deal do not change the challenges of the wireless phone industry, which it says requires more airwaves, known as spectrum, to expand.

The deal would have solved that problem for a time, and without it, “customers will be harmed and needed investment will be stifled,” AT&T said in a statement.

It called on the government to quickly approve its purchase of unused spectrum from Qualcomm Inc. and come up with legislation to meet the nation’s long-term needs.

AT&T, the nation’s second-largest wireless carrier behind Verizon Wireless, faces paying Deutsche Telekom $3 billion in cash and may have to enter into a roaming agreement with Deutsche Telekom, while transferring it the rights to spectrum it doesn’t need for the rollout of its planned, next-generation “4G” network.

AT&T’s purchase of T-Mobile from Deutsche Telekom of Germany would have made it the largest cellphone company in the U.S. T-Mobile is currently the fourth-largest.

The Justice Department sued to block the merger on Aug. 31, saying it would reduce competition and lead to higher prices.

Last month, the companies withdrew their application to the Federal Communications Commission after its chairman also opposed the deal.

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I hired the wrong person and she turned on me

She's gone now, thank God, but I can't get her out of my head

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I hired the wrong person and she turned on me (Credit: Zach Trenholm/Salon)

Dear Cary,

Three years ago, I hired what I thought to be a talented, kind and honest second in command at the magazine where I work. It turns out, I was only one-third right. While “Sally” was great at many parts of her job, she wasn’t honest and she wasn’t nice. She began sleeping with another person in my department (my work equal), and was dishonest about it, and would often say, “The art department feels this would work better this way,” when our entire organization knew these people were a couple. She’d undermine me at meetings with higher-ups, criticizing my ideas and interrupting me, and in meetings with me one-on-one, she’d burst into tears at the slightest disagreement or say, with a stern little look, “We’ll just agree to disagree.” It made any sort of discussion darn near impossible.

She also puffed herself up constantly — “I was mistaken for a model yesterday!” and made digs at me and other people at work, “Well, that’s not MY taste. But, interesting!”

I was trying to figure out how to fire her when she took another, more lucrative job in another field. The guy at my office dumped her shortly before this happened. But sadly, even though it’s been a year, I’m still haunted by the experience. I feel like I let myself be steamrolled by an “All About Eve” clone, and I dread running into her at events in my relatively small professional circle.

I honestly believe she’s a pretty lousy person, and I wish her ill. But I check her Twitter feed, and, honestly, am a little obsessed with hating her. How can I move beyond this, or, better yet, make sure other people in my industry know she is evil?

The Bad Boss

Dear Bad Boss,

I know how hard these things can be. I am a champion grudge-carrier myself.

I could go into business carrying grudges. I could get a truck with a magnetic sign: No Grudge Too Small. Bulk Rates. Tired of carrying that grudge? Call 1-800-GRUDGE-KING.

Would it make you the most miserable man on earth, carrying all those grudges for others? Or would it be liberating, knowing that not one of them is yours?

Anyway, some of us are champion grudge-carriers and we need a way to let go of a grudge. If we don’t deal with it, it can last for years.

So what we do in the 12 steps, we do inventories. You could look that up. We work with a sponsor. We’ll say, I can’t stop thinking about this person who screwed me over. And the sponsor will say, Well, let’s do the steps on this. Or, have you done the steps on this? Or, what step are you on?

Doing the steps gets you focused on you, not the person you’re obsessing about.

In doing the steps, we write things down. We answer questions like, what happened, and who was involved, and what sort of injury or threat did we perceive? What area of life was affected? Was it our sex relations, our self-esteem, our status?

We just more or less dispassionately look at what happened. We break it down. We also ask what role we played. This is not done in a blaming way. We just, for instance, say, well, the role we played was, we made the decision to hire her. OK. The great part about that is it puts us in the mix and gives us a sense of agency. We’re not a victim, we’re a participant. We see, OK, we did have a decision and we did play a part. We might have made a different decision. Likewise with the other events, we just identify what part we played. It may be that all we did was choose to go to a party. But we realize then, though it may have seemed like we  had to do what we did, we see  that maybe we could have avoided the upset. Not that it’s our fault, but that we were present and played a part in it.

It reminds me a little bit of how one proceeds in cognitive therapy. What I like about cognitive therapy and the 12 steps is that they lead us increasingly toward reality. We are always asking what is real, what is concrete, what can we see?

Then we often find that our response had something to do with fear. We see that we were trying to prevent something from harming us.

As we continue in this way, dissecting the event, we begin to see that in an existential sense we can’t protect ourselves anyway. We are vulnerable. We may be disliked or disrespected by co-workers or family members. We may be cheated on or deceived. There are no guarantees. We cannot control other people. Meditating on this returns us to the real world; it restores a correct relationship to the awesome powers of life and death that surround us; it fills us with appropriate awe for nature and fate; it unites us with other creatures living and dead; it humbles us and returns us to the bosom of humanity.

This notion of letting go of control is a sticky one, because it involves beginning to trust in something outside ourselves, and often we have been adamantly self-sufficient. But to get out of our awful predicament we focus on something beyond ourselves. We place trust in something larger than us.

It’s not like we get converted or saved or ascend to a higher state of consciousness. It’s more subtle. We entertain the notion of something bigger than us, and it shifts our focus away from ourselves, away from our vexing, all-consuming fear. We see that the world is awesomely powerful and if it wanted to strike us down it would have done so already. So we relax a little. If it’s coming, it’s coming. Don’t sweat the small stuff.

Once you entertain that notion that maybe you are not the one in control, then you do not need to respond to every possible threat with a flanking maneuver and a public relations campaign. Some things you can just let go of.

You are able to entertain the notion that maybe it’s not about the other person. Maybe it’s about you.

So you work with a sponsor and the sponsor suggests you do a fourth step, or a tenth step, or maybe the sponsor just talks with you about this obsession you have. But somehow you work through it by working through it. You have a method. That’s the point. The 12 steps offer a method, a simple, concrete method of purging ourselves of worry, doubt and fear.

If you’re not an alcoholic or drug addict and don’t have an eating disorder or a sex addiction you can always go to Al-Anon.

It’s just helpful to have a group. The Al-Anon group is all about how we deal with problems associated with other people — how the behavior of other people affects us, and how we learn to separate our problems from other people’s problems.

Really, I suggest you check out Al-Anon. You can get some grounding in the 12 steps, and you can hear personal stories from people who are coping with similar situations.

Plus it’s sort of fun. Really. Once you get over the initial novelty of it it becomes fun.

If you don’t want to do the steps, you can certainly get into therapy. I’m all for therapy. But therapy costs money and its efficacy depends on the intelligence and talent of the therapist. The 12 steps are pretty much free, and they work.

So that’s my approach to dealing with grudges.

But I still like the idea of the grudge-carrying truck.

I bet I could make some money.

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Cary Tennis

Cary Tennis writes Salon's advice column, leads writing workshops and creative getaways, publishes books, writes an occasional newsletter and tweets as @carytennis.

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Fox Business Network exec: Channel has too much Fox, not enough “business”

Rupert Murdoch's would-be CNBC-killer suffers in the ratings as it imitates its ultra-conservative sister network

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Fox Business Network exec: Channel has too much Fox, not enough (Credit: Salon)

In 2007, Rupert Murdoch started the Fox Business Network to crush CNBC using the same tactics that Fox News used to surpass CNN: Make a louder, sexier, angrier, more right-wing populist product, and the old people who watch TV during the day will tune in. Except it didn’t really work with Fox Business.

CNBC averages 263,000 viewers during the workday, according to Nielsen. Fox Business tops off at 85,000 from 4:30 to 8 p.m., and that period includes daily shows hosted by Fox stars Lou Dobbs and Neil Cavuto. Fox Business executive vice president Kevin Magee had a great idea to finally turn things around, according to a memo Reuters obtained: Maybe focus more on business news?

“I’ve been asked to remind you all again that they are separate channels and the more we make FBN look like FNC the more of a disservice we do to ourselves,” Magee said in the memo dated October 5, carrying the subject line “Fox News and Fox Business.”

“I understand the temptation to imitate our sibling network in hopes of imitating its success, but we cannot,” Magee went on to say in the memo. “If we give the audience a choice between FNC and the almost-FNC, they will choose FNC every time. Earnings, taxes, jobs etc give us PLENTY to chew on.”

As Media Matters ably documents here, Fox Business is right now just a sort of weird alternate-Fox News, with slightly different personalities who are still fixated on the exact same right-wing causes and phony outrages. (Plus cantankerous Connecticut cowboy Don Imus in the mornings, which is an odd choice for a “business” channel.) It’s Fox’s ESPN 2, except without extreme sports.

Why would an investor or trader want to watch Eric Bolling interview Pam Geller about the “ground zero mosque”? Who turns on a “business news” channel hoping to see former Wall Street Journal editorial writer David Asman promote birtherism and interview an ex-NFLer about the dangers of gay marriage?

The problem with Fox Business is baked right into the channel’s founding: It serves a market that is totally satisfied with preexisting offerings. People who want conservative-slanted market news all day already had a channel: CNBC. Just about everything Fox Business has ever done is either a retread (sexy ladies talk about stocks, just like on CNBC!) or just stupid (a five p.m. show set in a weird fake Irish pub!). While CNBC flatters its viewers’ senses of sophistication and superiority, Fox Business assumes its audience would rather watch an interview with Tila Tequila than hear about the SEC’s decision to charge Goldman Sachs with fraud.

The Fox model doesn’t work with business news, where the pro-corporatist mind-set is already baked into the majority of “objective” coverage and there isn’t a need to spice up the mundane business of promoting the interests of the wealthy with culture war material. Fox Business should be targeting the conservative elites who find Muslim-bashing and birtherism a bit distasteful (if necessary). But those elites may never find a reason to tune in. News Corp’s own Wall Street Journal has an exclusive deal with CNBC, and WSJ reporters are just as turned off by the Fox Business brand as everyone else.

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Alex Pareene

Alex Pareene writes about politics for Salon and is the author of "The Rude Guide to Mitt." Email him at apareene@salon.com and follow him on Twitter @pareene

No, I can’t edit your manuscript for free

I write about books for a living, so people think I'd love to critique their prose

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No, I can't edit your manuscript for free (Credit: Zach Trenholm/Salon)

Dear Cary,

I’m writing to you because you’re very nice and have a great deal of empathy, and I’m hoping you can tell me how to respond with empathy in a situation that’s causing me distress.

I write about books for a living. I have been working with, around and in books for over a decade. Hooray for my job; I feel very lucky. In the last six months, four people I know have approached me and asked for help with books they are writing. They want me to read and evaluate and edit their manuscripts. They want me to tell them where to send their manuscripts after I have made them publishable.

To which I say: No way! First of all, I have two jobs and am often so busy I feel breathless. Second, I write about books; I’m not a literary agent or an acquisitions editor at a major publishing house. I haven’t even published a book of my own (though I hope to, someday).

But, even if I had the knowledge they seek, why should I use it to benefit them? Reading and editing a manuscript would take a helluva long time. What’s more, it’s work, work that other people get paid for.

All these requests have come from men. None of these men are professional writers. I am not in regular contact with any of them; they are once-removed from my daily life: the brother of a friend, the husband of a friend, and  the father of a friend. They don’t ask how I am. They don’t stop to consider if I’m busy. They don’t seem to read my (published!) writing, since their manuscripts are in genres I don’t write about.

When I get these requests, I feel incredibly stingy. I get angry and anxious and think uncharitable thoughts about them.  It seems to me that they are all entitled jerks who have no respect for me or my career. Sure, they might think I can steer them on a path toward publication, but also seem to think I have nothing better than sit around and read their stupid manuscripts. They’re so out of line I can hardly think straight.

I blew off the first request. I flat-out refused the second two. I still haven’t responded to the fourth one, which I received this morning. This last request seems very problematic, since it comes from someone I’ve known since childhood and who’s sick.

So, Cary, what do I do? Am I right in refusing these people? If so, what’s the best way to tell them that I can’t do it? And how do channel some generosity of spirit toward them? How do I stop getting so upset? Right now, I feel like a mean-spirited jerk.

Sincerely,

Angry Books Writer

Dear Angry Books Writer,

You are absolutely right that such work is not to be expected casually or for free. It is very demanding work.

So here is what I suggest: Think of an hourly rate that would make you happy. Don’t think of the “correct” rate or the “going” rate. Think of a number that makes you smile. Think of a number that is high enough to discourage most casual requests.

This is what a person — whom I was paying to advise me — advised me to do when I received such requests. It seemed weird at first. I thought, well, I should just charge what is the correct rate. She said no, forget correct. How much do you want? What would make you happy? And what would discourage casual requests? You don’t really want to do this work all that much anyway, right? So, OK, a number came to me. It seemed high. It seemed almost silly it was so high. But it felt good to me! So I said it out loud. And the person advising me said, OK, when people ask you for this kind of work, quote that number. And I did.

I ended up accepting some work at that price. Surprisingly, I enjoyed doing the work. The person desiring my services was happy to pay that rate. Neither one of us felt cheated. We were both pleased.

It turns out that stuff is worth exactly what someone is willing to pay for it. It turns out — surprise, surprise! — that you can make an agreement with one individual based on what each of you wants and it will work out fine. Amazing.

That one piece of advice was worth all the money I paid this person for her advice, and more. It solved the problem. It made me happy. I’m grateful to the person who gave me that advice. And now I am giving that advice to you. It makes me happy to be able to give it to you. Really, it does. Because I have benefited greatly from it.

As to your desire to respond with empathy, how can you not have empathy for someone who wants to publish a manuscript? Poor bastard. How can you not have empathy for the person? That doesn’t mean you have to become their servant.

When somebody asks you if you would do this kind of work for them, tell the person that you do occasionally take on such projects, in a selective way, and here is your hourly rate. And see what happens.

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Cary Tennis

Cary Tennis writes Salon's advice column, leads writing workshops and creative getaways, publishes books, writes an occasional newsletter and tweets as @carytennis.

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Who’s afraid of the AT&T merger?

American antitrust law is a relic of 19th century agrarian populism

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Who's afraid of the AT&T merger?

Recently, during a visit to a national park, I found that I could not use my cellphone to communicate with the friend who had accompanied me. A park ranger was kind enough to explain that calls in the park could not be made by those of us who pay my particular private wireless carrier, but phones using the services of other companies worked. I used the park’s land line to call my friend, thinking grimly: This doesn’t happen in countries with national phone monopolies.

Now we are told that the merger of AT&T and T-Mobile would create a monopoly. I am tempted to favor any monopoly that allows all phones to work everywhere in the U.S. But I don’t want to talk about the details of that proposed merger.  My subject is American antitrust law, which I have studied for years, in the hope of making sense of it. I finally gave up.

Most Americans think that antitrust is among the founding principles of the American republic. And many people assume that there is widespread consensus among economists behind antitrust policy. Neither assumption is correct.

Antitrust law in its present form goes back not to the Founding but to the Sherman Antitrust Act of 1890. Like most pieces of bad legislation, the Sherman Act and later antitrust laws passed because they were vague enough to satisfy groups with entirely different conceptions of what it meant. The Sherman Act says: “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.” This sounds good, but what does it mean? To this day, nobody knows.

Even the name ” antitrust” is weird. It comes from the term “trust” for the legal entities that late 19th century businesses in America created so they could operate in more than one state. Although trusts became obsolete when states like New Jersey and Delaware permitted the incorporation of national companies, this quaint term has lingered from the era of small-town bandstands, straw boaters and nickelodeons. The agrarian populists of the time viewed multi-state businesses as sinister conspiracies, and so ” trust” came to mean any national corporation or bank.

The federal courts, which are charged with interpreting antitrust law, have failed to come up with any coherent doctrine for more than a century. Under the Sherman Antitrust Act, John D. Rockefeller’s Standard Oil Company was broken up, but U.S. Steel, which dominated about as much of its market, was left alone by the federal judiciary. In the 19th century, federal judges decided that the Sherman Act made unions illegal conspiracies in restraint of trade (it took decades for Congress to legislate otherwise). Nineteenth century federal judges ruled that cartels, which were perfectly legal in Britain, France, Germany and Japan, violated the Sherman Act, while mergers did not. So the U.S. in the early 1900s ended up with far more giant corporations than other industrial countries that permitted reasonable cooperation in prices and standards among smaller firms.

People whose understanding of the economy is limited to the simplicities of Econ 101 sometimes think that the purpose of antitrust is to promote innovation by promoting competition. But in the mid-20th century, the great economist Joseph Schumpeter argued that monopolies and oligopolies can be creative — think of Bell Labs, Amazon’s Kindle and Apple’s iPhone. Thanks to productivity, efficient monopolies can sometimes lower prices more than perfect competition among many less-well-capitalized firms could. In the late 19th century, John D. Rockefeller came close to monopolizing the U.S. oil industry. Thanks to economies of scale in his refineries, oil prices dropped dramatically. Until World War II, Alcoa monopolized the U.S. aluminum industry. Thanks to economies of scale in its factories, aluminum prices plummeted.

Falling prices, in one industry after another, have resulted from technological productivity growth, not from market competition among many small producers. And in industries with increasing returns to scale, technological productivity growth is often made possible by concentration. If the antitrust ideology were correct, then efficiency would be promoted by smashing Boeing into pieces. Would the American aircraft industry be stronger if there were dozens or hundreds of tiny, undercapitalized aircraft manufacturers?

According to antitrust theorists who believe that ” excessive” market share in itself is a threat, there is supposed to be a balance between efficiency produced by scale and “harm to consumers.” But this is doubly dubious. First, efficiency benefits consumers. Second, the alleged harm to consumers frequently is not identified with actual, identifiable acts of harm that violate the law. Harm is equated with mere bigness. A company with too great a market share might or might not do something, sometime, somewhere, that might or might not harm consumers.

Some observers of the AT&T/T-Mobile case have speculated that AT&T has downplayed the efficiency argument for the merger because greater productivity means doing more with fewer people — an unpopular argument at a time of high unemployment. If so, that is further evidence of the irrationality of antitrust. Here’s a bold jobs plan: We could reduce unemployment, at the price of long-term growth, by replacing efficient, capital-intensive big companies with lots of small, labor-intensive, under-capitalized mom-and-pop operations.

All of this explains why American antitrust law has had surprisingly little support from economists of right or left. At the time the Sherman Act was passed, most conservative economists as well as most progressive economists welcomed the efficiencies made possible by large industrial corporations. In the name of the New Nationalism, Theodore Roosevelt distinguished among ” good” and ” bad” trusts and supported a failed bill that would have established executive branch regulation of national corporations — something that makes far more sense than the attempt to regulate national companies by means of random lawsuits.

After World War II, liberal economists like John Kenneth Galbraith took for granted oligopolies and monopolies in the industrial sector and thought they should be balanced by government and unions, not smashed to smithereens. From the Progressive era onward, organized labor preferred to deal with large companies than lots of small ones. In the Reagan era, Robert Bork and other conservative experts argued that American antitrust policies made no sense. Supporters of an American industrial policy in the 1980s and 1990s argued that antitrust hampered U.S. competitiveness.

With so many critics, who are the friends of antitrust law in America? Other than individual companies that believe they can gain an advantage from antitrust litigation, the friends of antitrust tend to be limited to antitrust lawyers, politicians and some populists and liberals.

For populists in the tradition of William Jennings Byran, antitrust was part of a trifecta of anti-bigness policies that included laws protecting small, unstable local banks and laws protecting mom-and-pop retailers from chain stores like the sinister Woolworth’s and the even more ominous Piggly Wiggly. The small-town special interests the agrarian populists sought to protect are mostly extinct, and their great-grandchildren shop in national chains and have accounts with national banks, innocent of the fact that, according to Great-Grandpa, they are betraying Jeffersonian democracy.

Liberal supporters of antitrust policy tend to find a hero in Louis D. Brandeis, the progressive lawyer and Supreme Court Justice who influenced the New Freedom, Woodrow Wilson’s alternative to Theodore Roosevelt’s corporation-friendly New Nationalism. Like the Virginian Wilson, the Kentucky-born Brandeis was a Southerner who denounced “the curse of bigness” and favored anti-chain store laws as well as antitrust prosecutions. His was one of the deciding votes cast by the Supreme Court against the constitutionality of Franklin Roosevelt’s National Industrial Recovery Act, which sought to allow trade associations to set minimum prices, in order to support universal minimum wages negotiated by companies with labor unions. Today the heirs of Brandeis are found among the sort of progressives who support local organic farming and denounce Wal-Mart as their predecessors blasted A&P in the 1920s and 1930s. (To the extent that Williams Jennings Bryan has contemporary heirs, they are found among fundamentalist Protestant creationists and the Tea Party followers of Sarah Palin and Michele Bachmann.)

Progressives who favor both labor unions and breaking up big and efficient companies are confused. On the one hand, they want businesses to pay workers more than subsistence wages. On the other, they support a policy that aims to replace big businesses with smaller businesses that are less likely to pay good wages or provide benefits.

Antitrust progressives are also fooling themselves with their fantasy of a liberal-small producer alliance. In Jeffersonian mythology, the “people” are identified, not with the numerical majority of workers and consumers, but with the minority of local small bankers and small business owners (a fraction of the 10 percent of Americans who are self-employed). This small minority of the American population is not “the people,” it is a collection of parochial local elites who often want to be protected from larger, more efficient national and global competitors.

What about limiting antitrust law to outlawing monopolies? That would be a bad idea, too. There are two kinds of legitimate monopolies. In utilities like water or electric grids, natural monopolies ought to be socialized or regulated with private ownership. In industries where superior technology or organization temporarily results in a few winners — that is, most industries — there is no need to intervene, as long as companies with new and better technology or organization can displace them. Have you mailed a Western Union telegram recently?

American companies are allowed to become successful, but only to a point. If they become too successful, often they will be harassed by the government or destroyed. No other industrial country punishes its most successful firms like this.

The problems with American corporate capitalism — overpaid CEOs, short-termism, corporate campaign contributions — are real and serious, but government lawsuits to prevent mergers or to shatter successful firms do nothing to address them. As repealing the Sherman Act is unlikely, Congress and the courts should do the next best thing: limit antitrust litigation to punishing clear and narrowly defined acts of corporate predation after they have been committed.

From this logic follows the conclusion that mergers, like that of AT&T and T-Mobile, in general should be allowed to proceed. If, following the merger, the company were to exploit monopoly power by jacking up prices and gouging consumers, then it should be punished. But preventing mergers because companies might do something wrong, even though they haven’t yet, is too much like the corporate version of laws against “pre-crime” in the movie “Minority Report.”

Mitt Romney to the contrary, corporations aren’t people. Nevertheless, they should be treated as innocent until proven guilty. Even big, bad “trusts.” 

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Michael Lind’s new book, "Land of Promise: An Economic History of the United States", will be published in April and can be pre-ordered at Amazon.com.

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