Another one bites the dust

By Carl

Yet another regulatory shortfall of the Bush era is going bye-bye:

The Obama administration is seeking to undo yet another leftover from the Bush years by strengthening antitrust laws, the New York Times reports in leading off its business coverage.

In a speech later today, the Justice Department antitrust chief, Christine A. Varney, will lay out new "plans to restore an aggressive enforcement policy against corporations that use their market dominance to elbow out competitors or to keep them from gaining market share."

During the Bush years, the newspaper points out, the cards were stacked in favor of the corporate defendants facing antitrust claims. The White House is looking to level the playing field, restoring a policy "that led to the landmark antitrust lawsuits against Microsoft and Intel in the 1990s," the newspaper writes.

Intel, it should be pointed out, is about to hear the EU decision on its monopolistic tendencies.

Why is this important now?

In the midst of an economic recession or depression, there is a strong urge, indeed a strong rationalization, that stronger players in iffy markets buy up the players who are on the ropes, essentially creating at the very least an oligopoly, if not an outright monopoly.

Indeed, one might make the case that Herbert Hoover's relaxation of oversight on business combinations paved the way for the Great Depression by allowing banks to create credit consortiums that effectively froze out smaller banks from access to money to lend to their customers.

And certainly, the case against Standard Oil was based squarely on its actions in the period running up to and including the recession of 1907.

The trick this time around is to increase the economic productive of weak sectors like banking and housing while avoiding the temptation to use public funds to create megalodons of the market.

The structure of this recession/depression is such that more monopolies are likely to form as credit lines remain dried up, meaning that only companies who can finance internally (through their own cash reserves or by issuing private debt) will be able to survive in style.

And naturally, that will imply size as a factor in survival. The American capitalist system has tended towards "bigger is better" for decades now, when in point of fact, classic capitalism requires quite the opposite: smaller players competing for expanding markets.

(Cross-posted to Simply Left Behind.)

Another loss for the home team

By Capt. Fogg

Even though their last attempt in 2003 was shot down by a Federal Appeals Court, the GOP controlled FCC under Kevin Martin has decided, despite public and congressional disapproval that we need less diversity in the media and as of yesterday has made it far easier for the handful of heavily Republican near monopolies that own most of the newspapers, TV and radio stations in the US to move toward unobstructed media consolidation in all markets. In the cases where such cross ownership isn't allowed by the rules, waivers will be granted and if there is no preference for "conservative" viewpoints, I will be amazed.

There's still hope that a wrench can be thrown into the machine once more and another handover of public property to the corporate barons prevented, but we have to let our senators know and we have to do it now. 25 of them have already pledged to overturn this outrageous ruling but we need more - unless of course you really want a country where all you can read and hear is Michelle Malkin, Rush Limbaugh and lyin' Bill O'Reilly.

Cross posted from Human Voices