Book Review by Tom Nelson — Monopolized: Life in the Age of Corporate Power (David Dayen)
The problem with monopolies is that — like “elasticity of demand” and other boring economic terms — we don’t make real-world connections to these phenomena. Busting up monopolies sounds like a chapter in an economics textbook. But they are more than entries in college syllabi or freshman core course requirements; monopolies are very real, they depress wages, raise prices and kill the jobs that should go to those students.
In Monopolized: Life in the Age of Corporate Power, David Dayen, American Prospect executive editor and monopoly expert, shares twelve vignettes and compelling personal stories of corporations swallowing up whole industries and obliterating people’s livelihoods. In a lot of cases, it means splitting up families, and in some instances, causing suicides.
The industries he reviews include technology, banking, air travel, and even professional sports. One chapter that hits close to home is agriculture because dairy is the cornerstone of Wisconsin’s economy and culture and my dad grew up on a dairy farm.
Dayen touches on dairy, but hones in on hog farming in Iowa for his narrative. From 1997 to 2017, the Hawkeye State, which has seemingly become a wholly-owned subsidiary of pork producers, saw 12,500 of its family hog farms disappear. Megacorporations like Chinese-owned Smithfield Farms consolidated and expanded on an unprecedented scale, driving down hog prices some 60 percent. The small farmer couldn’t compete and went bankrupt. Over roughly the same time period, Wisconsin lost a similar percentage of dairy farms (70 percent). “Dairy farmers are in total crisis,” writes Dayen.
The government didn’t help small farmers much even when they were supposed to. Half of the outlay of price supports and public subsidies in the 2018 farm bailout bills meant for farmers who were truly hurt by the trade war with China went to Big Ag. As one congressman said, “There’s a lot of Manhattan addresses on those checks.”
Century-old antitrust laws, exemptions, and lax enforcement allow corporate America to go unchecked. Dayen notes two pernicious examples in the ag chapter. Seed companies — of which there are few — prevent farmers from owning the seeds they buy or re-planting in future seasons. The top two manufacturers of tractors and farming equipment — which dominate half of the market — limit access to embedded software needed to fix machinery to authorized agents. According to Dayen, “You could miss a harvest and lose your farm just because you can’t fix a locked-down machinery circuit.”
Dayen weaves stories of other corporate behemoths like Amazon, Zillow, and Ticketmaster raising prices, killing jobs, or strangling budding entrepreneurs. And then there is the story of the lone manufacturer of hospital saline bags based in Puerto Rico. When Hurricane Maria knocked out the island in 2017, production ground to a halt, and on the mainland, patients found doctors and nurses improvising with needles; this no doubt left us woefully unprepared for the pandemic. And speaking of COVID, this sounds a lot like the present economic crisis where a shortage of microchips — thanks to neo-liberal economic theory (add that to your econ vocabulary) that told corporate America to off-shore their manufacturing capacity — has crippled supply chains. This is putting household durable goods like microwaves, cars, and refrigerators out of reach for the average family and driving inflation to its thirty-year peak.
Dayen suggests closing antitrust law loopholes, hiring attorneys in the Justice Department and Federal Trade Commission who will enforce the law and vigorously prosecute offenders, and appointing federal judges who won’t side with big business but will instead interpret the law as it was intended and break up monopolies that hurt consumers and stifle competition.
Corporate consolidation receives scant attention in today’s political discourse. It is refreshing to see a prominent, well-respected progressive writer speaking truth to power. Dayen has opened my eyes to the pervasive sickness of monopolies that infect the Wisconsin landscape from the countryside (corporate farms) to the main streets (big banks) to our industrial parks (pulp and paper, automotive). You’ll be hearing a lot about this from me in the months to come. See you on the campaign trail.