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Dave Johnson

Dave Johnson

Posted: January 23, 2010 02:34 PM

Supreme Court Shifts Business Playing Field Away From Marketplace

What's Your Reaction:

The Supreme Court ruling allowing corporations to use their vast resources to directly influence the political process shifts the business playing field away from competing in the marketplace with products and services, to purchasing government/legal/reguatory advantages, subsidies and monopolies.

The marketplace is now irrelevant - only company size matters. It is just more efficient to beat your competitors by buying legislation than it is by competing in the marketplace. When you can purchase $1 billion in tax breaks, subsidies, mandates, contracts, whatever by spending a few million on candidates/influence, etc. it just makes more sense to do so. The return on investment is just so much higher than building factories, spending on research, paying employees, and other tedious, time-consuming, capital-intensive work.

For some time companies have recognized that the rewards from lobbying outperform the rewards from competing in the marketplace, and this ruling just amplifies that. This 2006 New York Times article, Google Joins the Lobbying Herd, discussed how Google felt it had "no choice but to get into the arena" to start "spreading its lobbying dollars" around to politicians and quotes Lauren Maddox, a lobbyist for Google, saying the "policy process is an extension of the market battlefield." This supreme court ruling just clinches this shift away from markets.

The game is necessarily going to be to use the superior resources of larger companies to purchase barriers that block smaller, innovative companies from getting anywhere, and force them to be absorbed.

Companies that think they can opt out of this and continue to compete with innovation, superior products and services are just mistaken. Any company that doesn't see this change will find that their competitors are working to buy legislation/rulemaking against them, and won't last long.

It's going to take a little while for this to sink in, but it is inevitable now.

 

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11:42 PM on 01/25/2010
We really do have the best government money can buy ... when will people wake up, and stop voting in corporate candidates? No matter what they say, the two parties are the same - and only speak $$$
04:38 PM on 01/25/2010
The U.S. has all the worst vices of socialism without any of the benefits. What we have now in the U.S. is crony capitalism at its worst, like in Nigeria, Russia or Colombia.

I live in Europe, and aside from our respective national and regional governments, we have the European Union rules that break up oligopolies and mafias for the benefit of free enterprise. Is this stiffling "government intervention" ? no ! we all benefit, and companies of all sizes benefit the most.

Recently there was a E.U ruling that imposed a huge fine on Telefonica of Spain, for abusing its control over internet lines. Thanks to this ruling and huge fine, I have been able to switch my internet service to a smaller new company and now pay 40 euros less a month on fixed costs for telephone and internet.
This is a good example of government ( we the people elect them or fire them ) acting for the benefit of free enterprise. This is the opposite of what is happening now in the U.S.

I wish the American people were better informed of how things work in Europe. Right now we are being told that the only alternative to crony capitalism as practiced today in the U.S. is "socialism"
03:01 PM on 01/25/2010
What the supreme court did was treason. Now there is no hope of turning that decision back with a Constitutional amendment, since those responsible for amending the Constitution can now receive unlimited bribes from corporations that support the court's ruling. It seems the only way we will get democracy back is by forcing the government to change in our favor. There are several ways to do this: massive protests with lots of civil disobedience, national labor strikes, or revolution.
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abbienormal
What hump?
02:03 PM on 01/25/2010
Expect a new round of protectionism. Can't have those cheap imports cutting into profits.
08:40 PM on 01/24/2010
Only a dream, but if Uncle Sam would get out of the market place, there would be no "purchasing government/legal/regulatory advantages, subsidies and monopolies." A free market is just that "free" -- the parasitic drones who are now setting up a false "Wall Street" versus "Main Street" scenario are living off our taxes and will continue to do so as long as people mistakenly believe that the government is the solution, and not the problem. The tax-fed fat-cats inside the Beltway are destroying our nation with their "lawmaking"-- but at the moment, we are told, by the tame media, that they are all for "Main Street". Now they are going to "create jobs" -- how? The only thing these bureaucratic hordes create is hot air, taxes, and wars.
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Dave Johnson
09:08 PM on 01/24/2010
If the government (We, the People) "got out of the marketplace" there wouldn't even BE a marketplace. Where do you think the laws and rules and enforcement come from? Sheesh. And the largest corporations - the ones wioth the most money - would simply own everything, get rid of wages, dump toxins wherever they want, etc...

Government is the people banding together to protect themselves from exactly this sort of corporate-rule world you dream of.
11:13 PM on 01/24/2010
Further: corporations and the liability shields that protect their shareholders from liability are also functions of legislation. And contracts? Just a product of legislation and judge-made-law (the "judicial activist" stuff... its called Common Law). And property? Just a bundle of rights granted by the government. Get the government out of the marketplace and you have no market place.
JNarragansett
Check your premises
11:29 AM on 01/25/2010
There is a difference between government getting out of the market as a participant and the government getting out of the market as a referree. Hayek talks about this lack of understanding in the Road to Serfdom when he discusses "planned" economies. He states that "planned" has come to mean central direction, when it can also encompass the role of the government to ensure that markets are free. I'm pretty sure Stirner was claiming that the government should not be a market participant.
05:16 PM on 01/25/2010
I can tell you have not been outside the U.S. Stop watching so much TV
05:50 PM on 01/24/2010
While I don't see the film as his best effort, Mike Judge should be noted as a prophetic figure for bringing to film the future of the United States as envisioned by the current conservative SCOTUS gang: IDIOCRACY, or the United States of Corporate America.

But I do look forward to the NASCAR-like, corporate decal-covered business suits for DC pols.
02:19 PM on 01/24/2010
How about all politicians at the federal, state, county, city levels (specially those complaining loud about the Supreme Court ruling) pass a law / regulation barring an elected person from voting on a bill that would impact directly on indirectly on their campaign donors who have donated more that $100:00?

The people, especially in California, can start this wave with a proposition on their next ballot. Will President Obama support this? It will certainly make him popular.

Such practices in most other situations is politely termed as 'conflict of interest'; and more truthfully as bribery. The later is also classified as a 'crime'.
06:23 PM on 01/24/2010
How about let's demand that all elective offices are to be mandatorily and completely publicly funded. Pay $10 each year for presidential elections, then pay $5 each year for your particular state senate race, $3 for your federal representative, $2 each year for your state senator and another $2 for your state rep, $2 for governor, etc. $24 from each person. Then we say this: you get elected then you get your salary, your benefits, your office, your staff at the region's median income - and that's it. No other source of money, goods or services of any kind are available to you under penalty of making you ineligible for life for any elective office and the briber - sorry, "lobbyist" - is prosecuted. Yeah, because no legislator is an expert in very many areas, experts are required to testify before the body on any matter coming before it, then experts on who will be hurt by the legislation under consideration. Then vote. Ends dialing for dollars, the Supreme Court's mandated bribocracy, legislators are doing their job...sounds like democracy.
08:00 AM on 01/25/2010
Very good Maggie !!!! great proposal, with imagination and talent
10:58 PM on 01/26/2010
I have been saying that the salaries of our elected officials/"representatives" should be based on the average pay...regional median income is good...but I would suspect that those in Congress will determine their region to be their disgraced halls and will based their pay on their "peers" there. The salary should be based on the median income on the American citizen. I like your idea for election funding.
I would like the people to be able to vote on who they actually want, not just one person that the "party" has determined to offer us.
I absolutely agree with your stipulation that no other source of money, etc. be made available or accepted. I really like the idea of prosecution for the briber and bribee (is that a word?). Where do I sign up for your plan?
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02:18 PM on 01/24/2010
Corporations have always used their resources to influence the political process, and the business playing field has been shifting from competing in the marketplace to purchasing market advantages, subsidies and monopolies for at least the last 30 years. This SCOTUS ruling is simply the culmination of decades of neo-conservative strategy, political wins and policy revision, and finally enthrones the patrician business class as the ruling oligarchs of our once proud Republic.
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Dave Johnson
09:04 PM on 01/24/2010
Exactly.
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12:26 PM on 01/24/2010
Every time I think up a worst case scenario, another worse one pops into my mind.
Bottom line?
We are doomed.....
12:18 AM on 01/24/2010
Has the Supreme Court ever admitted they were wrong before? Because they need to be mature and intelligent instead of egotistical and admit they made a huge error and undo this ruling.
10:24 PM on 01/23/2010
This is the end game isn't it? There is now no incentive for innovation from the corporate sector. All they have to do is lobby D.C for there own best interests and then buy up all the small businesses that actually do the innovation. Much like we've seen with the oil and auto industries for the last century.
This is going to get so ugly and it's going to hurt real bad!
12:53 PM on 01/24/2010
The giant corporations HAVE been buying up the small, innovative businesses. Witness the high tech companies that had any money-making worth - they were picked up and made billionaires of the owners who sold. Small companies are the hives of creativity and the largest employers. We've had 30 years of mergers and acquisitions, "green mailers", leveraged buyouts, KKR-types (now a hedge fund). Those phenomena, brought on by the new economic paradigm defined by the Laffer Curve, are what have brought us to this point. Once a corporation buys up a creative company, jobs are cut, the corporation continues asa bureaucracy and a marketing company. Corporations add to those sins by infantilizing employees so that, of course, the best way to succeed is by kissing the you-know-whats of the proper people. The enormous loss, after the loss of our economy and middle class, is that now we've effectively lost what was left of our democracy. Gonna take decades and a whole lotta pain to get any of those back. This is where America realizes that unbridled, unregulated capitalism is the exact opposite to democracy and begins to see that such an unbridled, unregulated capitalism isn't so very different from the Soviet system. They'll call it capitalism, but all the control now is fully in the hands of the few. This is absolute disaster and may even be worse than Bush v. Gore. I'm heartsick.
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Jannsmoor
09:32 PM on 01/23/2010
One can look at this as the natural evolution of unregulated free market capitalism. First, corporations gather great pools of wealth. Politicians seeking power court the money. Eventually, people like Karl Rove and Shrub Jr. decide they can create 1000 years of party rule by selling out the middle class to corporate interests (This is known as 'capture' of the government). Next, Shrub Jr. appoints radical right wing extremist Justices who share his vision of a corporate run America. Now, we are at the point where the reactionary miscreants on the Court are ruling as predicted. Money is speech and corporations are people (A complete corruption of the Constitution). Next, of course is the gradual degradation of middle class political and economic power. After that, people become prey of corporate interests who bleed them into poverty and bring about the collapse of the democracy.
It is Republican heaven. First money is power, now money is speech, soon money is the master.
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DiogenesOfAlaska
Mitt Romney for president - of the Cayman islands!
07:29 PM on 01/23/2010
This supreme court decision is so incredibly dumb and uninformed and mistaken that I still have difficulty believing that they actually made it.

It goes against the entire history of occidental rationalism as well as common sense. It is dumb as shit.
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Dave Johnson
09:03 PM on 01/24/2010
Well if the 5 judges who coted for this had an agenda, then reasoning wasn't part of the decision. Like Bush v Gore. They wanted Bush in, and that was that. No reasoning, just put him in and shut up. Oh, and you can't use this decision as a precedent for anything.
04:49 PM on 01/23/2010
China is the new "Standard Oil"

and without proving their currency has value, they have been able 'buy' most of the world.

This Supreme Court Ruling is HORRID!

but at the same time we need force China to prove its MONEY is worth the paper its printed on, before the world becomes Chinacorp. the Fabled one giant octopus corporation that will be the end of man, because MAN isn't 'efficient' enough of a lifeform.
01:01 PM on 01/24/2010
The problem with China's currency has been and continues to be that they keep it artificially low in comparison to the rest of the world's currency. Thus they increase their exports keeping their goods cheaper than what the importing company can make and beggaring Japan, Germany, the US and any other exporting company from effectively competing. If they didn't, the machinery and jobs would go down to the next lowest-wage country. Hellaciously authoritarian as China is, they are creating a middle class - but they're also creating the same yawning gaps in incomes as everywhere else. The dangers are that they can now fully modernize their military and they've shown no reason to trust their righteous intent. Be nice if we could take back our machinery and jobs now that we've sown the seeds of China's impending superpower status while we spread poverty at home.
04:36 PM on 01/23/2010
You are dead on target Dave.

Monopolistic privilege rent seeking is one of the furthest things from a free market system and it will not long for our nation’s economy to devolve into one of the most inefficient economic systems in the world.