Column on the Big Corporation Excuse

The Big Corporations Excuse
Tibor R. Machan
Anytime I mention to someone from the Left that I consider the scope of
government way beyond justice and prudence, I am likely to be told that it
is big corporations that make this necessary. And, furthermore, I couldn’t
really favor liberty for all if I don’t see corporations as a threat and
in desperate need of being reigned in.
So far as I understand it, corporations are just large groups of people
who have hired some experts in management aiming to achieve some goal they
couldn’t achieve on their own, like grow the company, make it seriously
prosper. So long as they do this peacefully, without using coercion to get
ahead, I see nothing wrong happening. Size is no problem. This is evident
in how we deal with people–some are tiny, some medium sized, some huge
but they can all get along fine if no one resorts of violence. And if some
big fellow comes off intimidating, a few smaller ones can surely contain
him–or her, for that matter.
What then is the big problem with corporations? As far as my Leftist pals
would have it, they can wield economic power. But what’s that? They can
buy stuff, expand their commercial reach, and flourish, yes, but not
without first pleasing their customers. And that means they can only get
ahead if they serve others in helping them do the same.
Yet there is one area where corporations can be a threat to liberty,
justice, and other fine things. This is where they get into bed with
governments. Only if governments are strictly limited in their scope of
authority, in what sorts of things they are legally authorized to do, can
this be avoided. If governments may yield to public pressure to undertake
various tasks like giving subsidies, bailing out failing companies,
restrict foreign trade, and so forth, this will invite business
corporations to seek or lobby for their help. And there is only so much
help governments can give, so those who will get it will have an unfair
advantage and will also be able to wield influence and political power.
This is where the trouble with corporations arises, although various other
associations can gain similar favors from government, such as unions or
large professional groups. What is the answer?
There are those who say nothing can help but giving government the
countervailing power which will keep corporations in check. I have never
found that a convincing solution. After all, usually the problem is
government and corporations (or some other group) getting into bed
together and running roughshod over others. (This is that famous process
euphemistically called wealth redistribution and commonly advocated,
naively, as a means by which the unfortunate will be helped but which in
fact involves a lot of what economists call rent-seeking, taking from
Peter and providing for Paul.)
If one is an economic determinist, one may think that nothing can be done
to prevent the corporate state from engaging in predation. But what if
education and some prodding can in fact help? What if people could learn,
in time, that governments need to be limited to the exercise of certain
specific, limited powers–as the American Founders put it, to “securing
[our] rights”? What if we could advance along such lines just as we have
made progress in the fight against slavery, racism, sexism, and other
evils?
The approach taken by libertarians, over all, is to have confidence in the
power of reason, in the capacity of human beings to learn to be just.
Takes time, yes, but is it hopeless? If it is, then so would be entrusting
the taming of the giant corporations–the title of an early book on this
topic by Ralph Nader–to governments. Public choice theory has pretty much
demonstrated that it is futile to count on government to behave in the
saintly way it would have to if this approach held out promise.
The famous statement of Lord Acton, that “Power tends to corrupt; absolute
power corrupts absolutely,” is right and undercuts the hope that the way
to contain corporations is by giving governments greater powers. Why those
on the Left don’t appreciate this baffles me.

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