Robber barons on K Street.

• Author: Glastris, Paul
• Position: Editor's Note - Advocacy and lobbying - Editorial

Since the Reagan administration rewrote the rules of anti-trust enforcement nearly three decades ago, the American economy has undergone wave after wave of corporate consolidation. As Barry Lynn and Phillip Longman make clear in this issue ("Who Broke America's Jobs Machine?" page 19), markets for everything from pet food to auto parts to microchips are now dominated by one or a handful of giant companies. This trend toward oligopoly has been hiding in plain sight for years. It affects countless aspects of our daily lives, yet we don't really notice it until something goes terribly wrong. It took the financial crisis for most of us to become aware of how dangerously consolidated the banking industry had become. Similarly, it took a yearlong debate over health care reform for the news to get out that insurance companies enjoy near-monopoly power in certain parts of the country.

The biggest problem the nation faces right now is unemployment. Could corporate consolidation be contributing to this, too? That's the argument Lynn and Longman make: with so many industries now dominated by a few big corporations, small businesses--the source of most new job growth--have less and less opportunity to thrive, expand, and ultimately challenge the behemoths. If their argument is right, then it's going to take a good deal more than tax breaks and stimulus spending to get America's jobs machine working again. It's going to require a much stronger effort by the federal government to enforce antitrust laws and bring more competition back into markets.

Might the corporate consolidation trend be warping Washington as well, giving big corporations greater leverage over the political process? Common sense suggests it should, and political science does, too. In 1965, the great theorist of lobbying, Mancur Olson, argued that interest groups with large and diverse memberships have a hard time organizing around a common agenda, whereas those made up of a small number of players--or dominated by one big player--find it much easier to speak with one voice and get what they want from government. Last year, Jeffrey M. Drope of Marquette University and Wendy L. Hansen of the University of New Mexico published research confirming Olson's theory: the more concentrated an industry, they found, the more likely it is to have a politically active trade association.

We see evidence of this in recent Washington policy battles, where the power of highly concentrated industries...