Partner Stories

The rise of giant platform monopolies like Facebook, Google and Amazon has drawn renewed attention to the problematic nature of concentrated corporate power. The unfettered power of these and other massive corporations is inextricably linked to the failure to decrease inequality, promote racial justice and address the climate crisis, and anti-monopoly work is a key ingredient in the fight to achieve durable progress on these critical issues.  

The Nathan Cummings Foundation’s Director of Corporate and Political Accountability, Laura Campos, recently sat down with leaders from three of our partners – Joe Maxwell, Executive Director of the Organization for Competitive Markets (OCM), Sarah Miller, Deputy Director of the Open Markets Institute (OMI) and Stacy Mitchell, Co-Director of the Institute for Local Self-Reliance (ILSR) –  all of whom are on the frontlines of the fight to decrease concentrated corporate power. Each shared their take on why antimonopoly work is attracting so much attention.  

Below is part one of NCF’s two-part series, “Corporations Shouldn’t Have a Monopoly on Power.”  

Laura Campos: What’s driving the renewed focus on concentrated corporate power? 

Stacy Mitchell: One factor is that there’s a growing recognition that the persistent structural problems we’re seeing in the U.S. economy are, at least in part, an outgrowth of concentration. For instance, we have low unemployment and yet people’s incomes are not going up. They’re totally stagnant. That’s been a puzzle for economists. But once they began to look at the effects of concentration, this puzzling dynamic suddenly made sense. In fact, concentrated corporate power explains a lot of the challenges we’re facing.  

The public gets this issue as well. People across the country see that, increasingly, control over what happens in their local community rests with far away corporations. Whether you’re talking about urban places or rural places, red states or blue states, concerns about corporate control really resonate. 

Sarah Miller: The scandals surrounding Facebook helped change the debate around concentration and monopoly power. For the first time in recent memory, we have a protagonist in the story about how and why monopoly power is so dangerous. Open Markets has harnessed this to reframe a lot of the problems plaguing our economy and our democracy, whether it pertains to workers, prices, regional inequality or political inclusion. 

Joe Maxwell: Some of the change is attributable to the conversations driven by the 2016 elections and the fact that both parties began to talk about the role that large corporations play in the continuance of a system where the deck is stacked against most people. The Republican base is just as leery of big as the Democratic base and that’s opened up the opportunity for bipartisan work. Policymakers are beginning to take a hard look at competition policy and antitrust work. We’re very optimistic that now’s the time to move. 

Laura: How does consolidation harm workers and exacerbate inequality? 

Sarah: When corporations have more power and fewer competitors, they’re able to exploit it to drive up prices and hold down wages. A study that came out a few years ago found that if levels of concentration across the economy were the same as they were in the early 1980s—so much less concentrated—your average worker would be making $14,000 more a year. That’s a lot of money. Other studies have also found that the massive amounts of competition among workers and very low levels of competition among employers have a very significant impact on income.  

Stacy: There are only a few companies competing for workers. So, if you’re a nurse or you repair farm equipment, chances are, in your region, there may be one or maybe two employers. And that means the companies have extraordinary power to hold down wages.  

Joe: An Oxfam investigation found that some poultry processing workers had to wear diapers because their employer would not give them bathroom breaks. People say, “Well, why don’t they go get a different job?” What needs to be understood is there’s not a different job.  

Stacy: This impacts wages throughout the supply chain too. A recent study by Nathan Wilmers of MIT’s Sloan School of Management found that manufacturers that sell into more concentrated markets pay their workers lower wages. For example, think of a food company selling to Walmart and the other dominant grocery chains, and how it’s constantly being squeezed by these big buyers.  

Historically, depending on your occupation, you could potentially go out and start your own business but that’s become much harder as dominant corporations rig markets. We’re now creating new businesses at about one-third the rate that we were in 1980. If forming a union was one path to the middle class, starting a small business was another. Today, both paths have been blocked by corporate power.   

Joe: We’ve unbridled capitalism and allowed for market share to be gained by a handful of very powerful companies. They’re able to squeeze all the profits out of that market and put them in their pocket. For instance, 71% of contract poultry growers live at or below the federal poverty level and yet Tyson is recording record profits each quarter. That money isn’t just extracted out of the farmer’s pocket but out of rural communities. We have seen small processing plants and small distributors driven out of business and seed corn companies put out of business by Monsanto. We’ve lost the wealth and infrastructure that those small businesses have supplied, and it has just devastated rural America.