Surveying the new JOBS Act, legislation with the ostensible purpose of aiding “emerging growth companies,” the Washington Post’s Rob Kaplan and Tom Voekler contend that the act’s biggest impact will be on the formation of “small and mid-sized business capital.”
Observing an important difference between “the largest companies” and “Main Street” businesses, the Post writers contend that historically, “for a host of reasons related to expenses and regulatory burdens,” only Big Business could access Wall Street. The importance and extent of their argument is seldom fully appreciated in political and economic discourse.
The impact of the “regulatory burdens” they allude to on the shape and character of the American economy is tremendous and probably isn’t what most people think it is. Correspondingly, the free market isn’t actually the glistering Holy Grail of Big Business daydreams.
Rather, freed markets — made up of voluntary trades and associations — represent the ideal mechanism for ensuring both that workers are rewarded in just proportion to their labor, and that big business’s costs aren’t shifted onto the people at large. Market anarchists are thus pro-market without necessarily being pro-business, distinguishing between the coercive privilege-saturated capitalism of today and a genuine state of economic freedom.
One of the best ways for big business to employ the power of the total state to destroy competition (aside from outright theft of land and raw materials) is to raise the overall cost of doing business. Though it is perhaps counterintuitive given the widespread myth that corporations only ever want to avoid government regulation, they very often welcome it as a way to cleanse the market of competition from below.
In The Search for Order, historian Robert H. Wiebe noted the belief of “private leaders” “that they could not function without the assistance of the government.” With the more blatant forms of bribery and payola no longer viable, Wiebe argues, big business now “wanted a powerful government, but one whose authority stood at their disposal.” The result is a “mutual dependence” between capital and the state, one that defines what passes for “reform” in the United States.
Since giant, multinational corporations have the money and resources to negotiate the flexuous passes of Washington bureaucracies, new legal and regulatory burdens frequently function to bar competition, both actual and potential.
The politically powerful represent the same ruling class as do the economically powerful. They are, as a general rule and overall, not rivalrous or antagonistic, but symbiotic, bound together by historical and cultural factors as well as common interests.
Forms of competition that exist (or would exist) outside of the formalized, corporate economy and that would allow people to do for themselves what they now have to pay powerful companies to do for them are fundamentally dangerous to the dominion of the ruling class.
These alternatives must therefore be legislated away as out of step with “consumer safety” concerns, an untenable scare tactic if ever there was one given the regular catastrophes of the present economic paradigm. Everything from building your own home to starting a small business out of it using knowledge and things you already have is treated as a threat to the economic structure of dispossession falsely associated with a free market.
Reducing corporate dominance within contemporary society is not and cannot be a matter of adding new rules to an already convoluted tangle of statutes and regulations. Instead it requires abolishing the pervasive privilege that characterizes today’s system, enabling free people to engage in whatever peaceful activities they choose within their own sphere of sovereignty and discretion.