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> No state government can take on Walmart or Amazon. An alternative theory posits that these massive corporations in fact depend upon the centralization of gov

> No state government can take on Walmart or Amazon. An alternative theory posits that these massive corporations in fact depend upon the centralization of governmental regulatory and fiscal powers for their very existence. Regulatory capture is much easier to pull off when there’s only one central authority that needs to be captured.

PaulDavisThe1st 5y ago
Regulatory capture is indeed a problem. But it's a hand-waving assertion that it's "much easier to pull off when there’s only one central authority that needs to be captured." This sort of claim seems to me fundamentally rooted in some specific ideas about large human organizations, specifically of the governmental kind. One of the key ideas it requires to be true is that the corruption endemic to small-scale institutions (think your local mayor, perhaps (depending on your state) even your governor) will automatically apply to much larger scale institutions (such as those administered by the federal government). I'm not going to deny that this could be true - it clearly could. But the change in scale, the change in mechanisms of influence that are required, the change in the possible side-effects of such corruption being uncovered ... these all point in the opposite direction, in my opinion. Amazon and Walmart are not the victors in a game of regulatory capture. They are the beneficiaries of the election of senators, representatives, presidents and the appointments of judges who explicitly do not believe in much regulation. Even so, they are subject to more oversight than one of my local ranching families in NM, who can get a (former) governor to re-route millions of dollars in state & federal funding to a road they would prefer.
- zozbot234 5y ago
  Corruption at all levels is far more "endemic" to large organizations than small ones. It's also less visible, because size correlates with a lack of transparency.
  - PaulDavisThe1st 5y ago
    Don't agree. Corruption "at all levels" requires coordination and/or a common stance towards it. Finding that in an organization of 3 people is not always so hard; finding it in an organization of 30k people is almost impossible.
    - redmen 5y ago
      There can be corruption at all levels without coordination. Example: greed. There is such a thing as unorganized corruption. Example, in lots of third world countries where their infrastructure and systems are so bad it breeds corruption. No need for a top down version of it.
      - PaulDavisThe1st 5y ago
        But if the greed is not coordinated, it's not going to pull an organization in a unified direction. Yes, I agree that you can see examples in some parts of the world and in some time periods (including today) where even uncoordinate corruption is very damaging to a society. But - and this is important given the context in which I started talking about this - it does not appear to be a pathway to regulatory capture nor the formation of giant corporations in the sense that was proposed up-thread, in which a powerful "federal" organization is used to enable such organizations to exist.
        redmen 5y ago
        Maybe only a unified direction towards dysfunction lol But yes in the context in which you have laid down you are correct I believe.
        deleted 5y ago
        [deleted]
        infogulch 5y ago
        > But if the greed is not coordinated, it's not going to pull an organization in a unified direction. Greed won't direct an organization in a unified direction, but that just exposes a vulnerability where an outside party can exploit the greed at an individual level to direct the organization in a unified direction of its choosing.
  - meheleventyone 5y ago
    Even if we take this as true small, local governments are still large in aggregate and suffer the same problem. Fighting small town corruption is a trope for a reason. If anything decentralisation makes organisations less transparent (e.g. cell organisation for crime/spies/terrorists) because there is no common means to look into them.
  - foldr 5y ago
    British local government is notoriously corrupt and very few Brits pay much attention to it in comparison to national politics (partly because it’s not reported on in major news outlets). See for example Private Eye’s “rotten boroughs” column. So that would be one counterexample.
- hattmall 5y ago
  The corruption is so endemic in large organizations it becomes a necessary quality to even be a possible participant. This is very up front and visible in US federal government.
onlyrealcuzzo 5y ago
Regulatory capture doesn't seem like it applies to Walmart... How regulated is discount retail?
- dev-3892 5y ago
  wages, social security, labor laws ... it's a bit harder to pin down, maybe this is all "just" lobbying?
  - bobthepanda 5y ago
    the first and third vary widely by state regulatory regimes. only the second is actually consistently applied by the federal government.
nr2x 5y ago
Good point but look at the fate of community broadband. That’s a battle being fought, and often lost, in statehouses.
Mountain_Skies 5y ago
When I worked as a consultant at Home Depot's headquarters, they often sent out emails from the "Orange Voice" pushing employees to lobby their members of Congress on various bits of legislation and issues. What was very clear was that Home Depot absolutely hated each state having its own set of laws. Even worse were local laws. They wanted there to be just one government for them to lobby for their issues and when one state requires them to have some operational quirk such as customer accessible price scanners with printers attached, the first instinct is to find a way to get the feds to find a way to make that state requirement go away.
- HWR_14 5y ago
  That's different and understandable. Everyone wants to have to comply with one set of regulations instead of one set of regulations plus fifty more additional sets of regulations (or more with counties/cities) that require additional effort to comply with and ensure the correct ones are complied with. Just the additional labor costs for lawyers must be real. Add to that the need to have special cash registers for one state, or other changes, and it gets pretty expensive. Hell, Home Depot would probably rather one national sales tax (regardless of whether it's higher or lower than the current national average) over the complexity of the current sales tax code. Just for the operational simplicity.
jeegsy 5y ago
> An alternative theory posits that these massive corporations in fact depend upon the centralization of governmental regulatory and fiscal powers for their very existence. Very well said
HWR_14 5y ago
> An alternative theory posits that these massive corporations in fact depend upon the centralization of governmental regulatory and fiscal powers for their very existence. I don't see what evidence there is of that. How does Walmart (specifically, since it was mentioned) benefit from federal government regulations in a way that gives them an advantage over other brick and mortars?
groby_b 5y ago
That would be a good theory if we didn't see a global rise of massive corporations. If we for a moment cynically argue this as a question purely of lobbying spend: Once your corporation makes profits measured in billions, it is relatively easy to have a large lobbying spend across many different governments. One answer here is a huge number of small governments. At the level of one for each largeish city, to make lobbying spend prohibitively high. That sort-of works, in that it creates incredible amounts of friction. It, however, also hobbles trade and innovation to an incredible degree. I don't see that as a good answer. Neither, I think, is one humongous centralized government - while it has the resources to outspend corporations, it concentrates inordinate power in a small number of hands. And if you're willing to assume that corporations will use money to solve problems (because that's kind of their whole point), there's a very small step from there to just buying a sufficient set of politicians. You need regulations somewhat unified to enable commerce at anywhere close to the level the world currently experiences. You need a decentralized system to deal with power concentration. This is an inherent tension that I can't see how to resolve in the face of corporations that are essentially the peers of nation states.

PaulDavisThe1st 5y ago

Regulatory capture is indeed a problem. But it's a hand-waving assertion that it's "much easier to pull off when there’s only one central authority that needs to be captured." This sort of claim seems to me fundamentally rooted in some specific ideas about large human organizations, specifically of the governmental kind. One of the key ideas it requires to be true is that the corruption endemic to small-scale institutions (think your local mayor, perhaps (depending on your state) even your governor) will automatically apply to much larger scale institutions (such as those administered by the federal government). I'm not going to deny that this could be true - it clearly could. But the change in scale, the change in mechanisms of influence that are required, the change in the possible side-effects of such corruption being uncovered ... these all point in the opposite direction, in my opinion. Amazon and Walmart are not the victors in a game of regulatory capture. They are the beneficiaries of the election of senators, representatives, presidents and the appointments of judges who explicitly do not believe in much regulation. Even so, they are subject to more oversight than one of my local ranching families in NM, who can get a (former) governor to re-route millions of dollars in state & federal funding to a road they would prefer.

zozbot234 5y ago
Corruption at all levels is far more "endemic" to large organizations than small ones. It's also less visible, because size correlates with a lack of transparency.
- PaulDavisThe1st 5y ago
  Don't agree. Corruption "at all levels" requires coordination and/or a common stance towards it. Finding that in an organization of 3 people is not always so hard; finding it in an organization of 30k people is almost impossible.
  - redmen 5y ago
    There can be corruption at all levels without coordination. Example: greed. There is such a thing as unorganized corruption. Example, in lots of third world countries where their infrastructure and systems are so bad it breeds corruption. No need for a top down version of it.
    - PaulDavisThe1st 5y ago
      But if the greed is not coordinated, it's not going to pull an organization in a unified direction. Yes, I agree that you can see examples in some parts of the world and in some time periods (including today) where even uncoordinate corruption is very damaging to a society. But - and this is important given the context in which I started talking about this - it does not appear to be a pathway to regulatory capture nor the formation of giant corporations in the sense that was proposed up-thread, in which a powerful "federal" organization is used to enable such organizations to exist.
      - redmen 5y ago
        Maybe only a unified direction towards dysfunction lol But yes in the context in which you have laid down you are correct I believe.
        deleted 5y ago
        [deleted]
      - infogulch 5y ago
        > But if the greed is not coordinated, it's not going to pull an organization in a unified direction. Greed won't direct an organization in a unified direction, but that just exposes a vulnerability where an outside party can exploit the greed at an individual level to direct the organization in a unified direction of its choosing.
- meheleventyone 5y ago
  Even if we take this as true small, local governments are still large in aggregate and suffer the same problem. Fighting small town corruption is a trope for a reason. If anything decentralisation makes organisations less transparent (e.g. cell organisation for crime/spies/terrorists) because there is no common means to look into them.
- foldr 5y ago
  British local government is notoriously corrupt and very few Brits pay much attention to it in comparison to national politics (partly because it’s not reported on in major news outlets). See for example Private Eye’s “rotten boroughs” column. So that would be one counterexample.
hattmall 5y ago
The corruption is so endemic in large organizations it becomes a necessary quality to even be a possible participant. This is very up front and visible in US federal government.

onlyrealcuzzo 5y ago

Regulatory capture doesn't seem like it applies to Walmart... How regulated is discount retail?

dev-3892 5y ago
wages, social security, labor laws ... it's a bit harder to pin down, maybe this is all "just" lobbying?
- bobthepanda 5y ago
  the first and third vary widely by state regulatory regimes. only the second is actually consistently applied by the federal government.

nr2x 5y ago

Good point but look at the fate of community broadband. That’s a battle being fought, and often lost, in statehouses.

Mountain_Skies 5y ago

When I worked as a consultant at Home Depot's headquarters, they often sent out emails from the "Orange Voice" pushing employees to lobby their members of Congress on various bits of legislation and issues. What was very clear was that Home Depot absolutely hated each state having its own set of laws. Even worse were local laws. They wanted there to be just one government for them to lobby for their issues and when one state requires them to have some operational quirk such as customer accessible price scanners with printers attached, the first instinct is to find a way to get the feds to find a way to make that state requirement go away.

HWR_14 5y ago
That's different and understandable. Everyone wants to have to comply with one set of regulations instead of one set of regulations plus fifty more additional sets of regulations (or more with counties/cities) that require additional effort to comply with and ensure the correct ones are complied with. Just the additional labor costs for lawyers must be real. Add to that the need to have special cash registers for one state, or other changes, and it gets pretty expensive. Hell, Home Depot would probably rather one national sales tax (regardless of whether it's higher or lower than the current national average) over the complexity of the current sales tax code. Just for the operational simplicity.

jeegsy 5y ago

> An alternative theory posits that these massive corporations in fact depend upon the centralization of governmental regulatory and fiscal powers for their very existence. Very well said

HWR_14 5y ago

> An alternative theory posits that these massive corporations in fact depend upon the centralization of governmental regulatory and fiscal powers for their very existence. I don't see what evidence there is of that. How does Walmart (specifically, since it was mentioned) benefit from federal government regulations in a way that gives them an advantage over other brick and mortars?

groby_b 5y ago

That would be a good theory if we didn't see a global rise of massive corporations. If we for a moment cynically argue this as a question purely of lobbying spend: Once your corporation makes profits measured in billions, it is relatively easy to have a large lobbying spend across many different governments. One answer here is a huge number of small governments. At the level of one for each largeish city, to make lobbying spend prohibitively high. That sort-of works, in that it creates incredible amounts of friction. It, however, also hobbles trade and innovation to an incredible degree. I don't see that as a good answer. Neither, I think, is one humongous centralized government - while it has the resources to outspend corporations, it concentrates inordinate power in a small number of hands. And if you're willing to assume that corporations will use money to solve problems (because that's kind of their whole point), there's a very small step from there to just buying a sufficient set of politicians. You need regulations somewhat unified to enable commerce at anywhere close to the level the world currently experiences. You need a decentralized system to deal with power concentration. This is an inherent tension that I can't see how to resolve in the face of corporations that are essentially the peers of nation states.