4 ms·

"In fact bigcos can not exist without government support" That is a mighty big claim which flies in the face of practical experience.

• likpok 18y ago
  Not that I necessarily disagree, but you could argue that in the time there have been corporations, there was also government support.
• michaelkeenan 18y ago
  alexandros might be referring to the argument was made by Roderick Long in Cato's lead essay in November: http://www.cato-unbound.org/2008/11/10/roderick-long/corporations-versus-the-market-or-whip-conflation-now/ http://www.cato-unbound.org/2008/11/10/roderick-long/corpora... He points out that government funding of highways acts as a de facto subsidy of Walmart and similar chains by partly socializing the costs of shipping, making it easier to compete with local businesses; and that regulations (which large companies can more easily understand and comply with than smaller companies) provide barriers of entry to industries. He concludes: "In a free market, firms would be smaller and less hierarchical, more local and more numerous" (I don't have a strong opinion on this. It sounds plausible but it's a bit anecdotal for my taste.)
  • bmj 18y ago
    I'm sympathetic to this, but at the same time, most local sellers (outside of those who exclusively sell locally-produced goods) rely on the same transportation system.
    • trickjarrett 18y ago
      I would argue they don't rely on it so much as make use of it. As cities grow then they need to truck supplies in from elsewhere, but for suburbs and rural areas they can survive on the local economy.
      • bmj 18y ago
        Maybe. It depends where you live, though--not every area is capable of sustaining its own food supply(1). And, even those that are still import some goods. But I think we're shifting the discussion a bit to a "Long Emergency" scenario. As a bit of localist, I'm more troubled by local governments who bend over backward to bring large retailers into an area. I think these more localized benefits (tax breaks, development dollars, etc) are far more beneficial to, say, Wal-Mart, than the highway system. (1) And many that can have transformed that land into housing and strip malls. EDIT: Fixed formatting.
• omouse 18y ago
  GM? Ford? I know IBM, HP, etc. get government contracts or at least did and those count as government support. Don't forget Microsoft which was supposed to be broken up but wasn't. Also, Bell and Rogers (in Canada) who are basically allowed to have monopolies over the phone and cable lines. Lockheed Martin and Boeing couldn't be as huge as they are without defense contracts either.
• anthonyrubin 18y ago
  Some ways in which the government helps large corporations: Subsidies, government contracts, regulations designed to increase barrier to entry, a legal system which favors those with more resources, beneficial legislation which can be bought through legalized bribery (lobbying and campaign contributions)
• alexandros 18y ago
  I am sorry, I had very little time to post and did not hedge my claim appropriately. I am glad that others have stepped in and filed the gap. The issue is that the government increases complexity and barriers to entry and therefore raising the Coase ceiling of how large an enterprise can become before being less efficient than a coalition of smaller rivals.
• ngvrnd 18y ago
  And, perhaps someone has pointed this out, but once gov't begins to regulate economic activity, the existing corporate players inevitably start to game the system. Who was it who said that truly free trade is great because it's the only ways to keep the capitalists in check?