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The rise of the corporate colossus is a giant problem

economist.com

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Re: The rise of the corporate colossus is a giant problem

#71

Post by snowwrestler »

throwaway729 wrote: post #21
sharemywin wrote: post #8

In 1990 the top three carmakers in Detroit had a market capitalisation of $36 billion and 1.2m employees. In 2014 the top three firms in Silicon Valley, with a market capitalisation of over $1 trillion, had only 137,000 employees.

Gvien the forum we're on, it's worth pointing out that today's white collar laborers are capturing one or two orders of magnitude less of the value they're creating than the blue collar workers of 1990's detroit. 360 billion* divided by 1.2 million = 300000 "per employee". Typical salary to 40,000ish-100,00ish range for laborers/engineers. The disparity in those numbers isn't so bad at all. Conversely, 1 trillion div…

The difference is that the autoworkers were organized and used collective bargaining to capture more value.

Re: The rise of the corporate colossus is a giant problem

#72

Post by devonkim »

soulnothing wrote: post #63
jackcosgrove wrote: post #32

Earlier quoted context omitted.

Not only that, but in US salaried status is routinely used to avoid paying overtime, when overtime is a tacit requirement of many jobs.

Even as a contractor with an hourly rate. The assumption is the rate given is for 40 hours a week. I've had a number of hourly contracts where I was told either work the over time or find a new contract. The lack of care to employees is appalling at times.

I've been on contracts that are flat billed based upon 40 hours / week but no overtime is chargeable. The problems start when more than 40 hours / week is regularly expected to perform assigned tasks to standards of the contract and there's little control you have over the client putting barriers in place that make you less productive making the true hourly rate at least 25% lower.

Re: The rise of the corporate colossus is a giant problem

#73

Post by taurath »

Spooky23 wrote: post #10

IMO, this problem is mostly a factor of the consolidation of finance. The roll up of banking makes it impossible for smaller enterprises to get traditional capital. We moved away from the old, boom/bust distributed banking model towards a weird form of command economy with a cartel of mega-banks, which are really just proxies for the government. People blame technology for the post-recession economy, but I think the…

Think about the reduction in what would be owner operated small businesses like shops and restaurants - go to almost any town (not city) in America and half or more of the commercial district is franchised or corporate chain stores.

Re: The rise of the corporate colossus is a giant problem

#74

Post by ubernostrum »

BurningFrog wrote: post #38
rayiner wrote: post #30

Earlier quoted context omitted.

The problem with the libertarian explanation is that it contradicts the actual facts. The "age of the Regulatory" state started in the 1930's. It has been in decline for decades--with major sectors of the economy being deregulated in the 1980's and 1990's. In the 1950's and 1960's, regulatory agencies often had the power to directly exclude potential competition and set prices for goods. They have a fraction of those…

> It has been in decline for decades I don't have time to put together a great convincing case, so I'll just say that this is very different from my view. Some high level regulations have been removed, sure, but meanwhile almost every corner of life now has regulations and regulators that have to be obeyed and asked for permission. It would be nice to have some kind of objective measure(s) of the overall level of sta…

I've had this argument with other people in the past and am willing to have it with you: the idea of a new and unprecedented amount of government "meddling" in the otherwise "free" market is a myth. The sea change of the 20th century lay entirely in bringing the machinery of government to bear in favor of people it had previously been used against, and against people it had previously been used in favor of.

And of course the people who previously were favored see this as new and invasive interference, because they had grown so used to being the favored parties that they simply took for granted that "free market" = "system rigged in my favor".

Re: The rise of the corporate colossus is a giant problem

#75

Post by friendlygrammar »

Animats wrote: post #65
pmoriarty wrote: post #58

Earlier quoted context omitted.

How much investment is actually done based on such fundamental analysis?

Everything Berkshire Hathaway does.

Berkshire Hathaway is successful because they invest in monopolies/duopolies

Re: The rise of the corporate colossus is a giant problem

#76

Post by wang_li »

rayiner wrote: post #30
BurningFrog wrote: post #20

A libertarian explanation is that in the age of the Regulatory State, it's often more important to be the biggest lobbyist than to make the best product. "In the Game of Crony Capitalism, you lobby or you die."

The problem with the libertarian explanation is that it contradicts the actual facts. The "age of the Regulatory" state started in the 1930's. It has been in decline for decades--with major sectors of the economy being deregulated in the 1980's and 1990's. In the 1950's and 1960's, regulatory agencies often had the power to directly exclude potential competition and set prices for goods. They have a fraction of those…

Just because some areas of the law have changes in the regulations doesn't mean that the overall amount of regulation isn't increasing.

Consider that the tax code[1] in 1984 was 26,000 pages long. By 1995 it was 40,000 pages. And by 2013 it was 70,000 pages.

1. http://finance.townhall.com/columnists/politicalcalculations...

Re: The rise of the corporate colossus is a giant problem

#77

Post by Spooky23 »

taurath wrote: post #73
Spooky23 wrote: post #10

IMO, this problem is mostly a factor of the consolidation of finance. The roll up of banking makes it impossible for smaller enterprises to get traditional capital. We moved away from the old, boom/bust distributed banking model towards a weird form of command economy with a cartel of mega-banks, which are really just proxies for the government. People blame technology for the post-recession economy, but I think the…

Think about the reduction in what would be owner operated small businesses like shops and restaurants - go to almost any town (not city) in America and half or more of the commercial district is franchised or corporate chain stores.

Other owner operated businesses struggle even outside of retail too.

A friend of mine ran a 4th generation, profitable manufacturing business and ended up shutting down not because of costs or competition, but because it was increasingly difficult to get working capital when the regional financial institutions were rolled up.

Re: The rise of the corporate colossus is a giant problem

#78

Post by tptacek »

wang_li wrote: post #76
rayiner wrote: post #30

Earlier quoted context omitted.

The problem with the libertarian explanation is that it contradicts the actual facts. The "age of the Regulatory" state started in the 1930's. It has been in decline for decades--with major sectors of the economy being deregulated in the 1980's and 1990's. In the 1950's and 1960's, regulatory agencies often had the power to directly exclude potential competition and set prices for goods. They have a fraction of those…

Just because some areas of the law have changes in the regulations doesn't mean that the overall amount of regulation isn't increasing. Consider that the tax code[1] in 1984 was 26,000 pages long. By 1995 it was 40,000 pages. And by 2013 it was 70,000 pages. 1. http://finance.townhall.com/columnists/politicalcalculations...

Huh? The tax code isn't even close to 70,000 pages long. What specific document are you claiming to be 70,000 pages long? The Standard Federal Tax Reporter? That's not the tax code.

Re: The rise of the corporate colossus is a giant problem

#79

Post by ersii »

sseagull wrote: post #18
forrestthewoods wrote: post #7

Growth is globalized. Global companies get a disproportionate share of growth. Therefore giants will become increasingly large relative to non-global entities. I'm not sure what the specific problems are. Which makes prescribing a fix impossible.

In my (uneducated) opinion, the specific problem is that the people, through their governments, lose control over these large, global entities that affect their daily lives. When they get this big, there's no way to tax them and no way to punish them for wrongdoing - they could just move to a friendlier country, use loopholes, etc. Of course, thanks to various trade agreements, they will still have access to our mark…

I know it's not an too popular opinion here on HackerNews and I'd say you're sort of right, but you got it in reverse. The problem is not that it's hard to control or tax companies, the problem is that it's not as easy for you or me to do the same.

You have to have significant resources to break free from local restraints, which is really unfortunate. It's also a lot of resources that gets spent, just so people or companies can do whatever they want with their own resources. In other words, it's possibly a loss of production - those resources could have gone elsewhere.

Please be gentle, I'm open for discussing these things.

Re: The rise of the corporate colossus is a giant problem

#80

Post by rayiner »

wang_li wrote: post #76
rayiner wrote: post #30

Earlier quoted context omitted.

The problem with the libertarian explanation is that it contradicts the actual facts. The "age of the Regulatory" state started in the 1930's. It has been in decline for decades--with major sectors of the economy being deregulated in the 1980's and 1990's. In the 1950's and 1960's, regulatory agencies often had the power to directly exclude potential competition and set prices for goods. They have a fraction of those…

Just because some areas of the law have changes in the regulations doesn't mean that the overall amount of regulation isn't increasing. Consider that the tax code[1] in 1984 was 26,000 pages long. By 1995 it was 40,000 pages. And by 2013 it was 70,000 pages. 1. http://finance.townhall.com/columnists/politicalcalculations...

The number of pages of regulations can increase even as the actual economic effect of regulation goes down. Air cargo deregulation is a good example: http://mercatus.org/publication/unleashing-innovation-deregu.... NLRB is another good example. I guarantee you it has more pages of regulations than it did in the 1940s--but nobody would argue it has as much power over the economy as it did back then.

Indeed, increased pages of regulations is as much evidence of decreased regulatory authority as the opposite. In the 1940s and 1950s, agencies regulated top-down pursuant to broad discretionary standards that could be summarized in a few pages. Today, agencies have to issue detailed regulations, justified by years of analysis and tens of thousands of pages of records, to change the lightbulbs.

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