The Downside of Large Companies

 There's a problem with our society that few people seem to discuss... large corporations.  While they can occasionally serve a purpose, I believe that, for the most part, they are a drag on our society.  Unfortunately, I don't see a way to fix this problem because of how much leverage they have on our economy and with the federal government.

Let me start by acknowledging what they do well.  By virtue of their size, large businesses are far better suited to undertake large research and development endeavors, because they have access to large amounts of human talent, labor and capital.  Furthermore, if an initiative fails to pan out, larger corporations are better suited to absorb the loss.  Larger companies are also able to operate more efficiently than smaller companies due to the economy of scale, because companies can spread fixed costs over a larger number of goods and services, and because they can take advantage of bulk discounts in purchasing.

The downsides of large corporations are myriad, but all boil down to one thing -- a lack of accountability.  If you go back to the days before the industrial revolution, businesses were small, and integral to their community.  Business owners had an incentive to produce quality goods, and to behave in an ethical manner because they directly interacted with their customers.  Seeing people face to face, and living in the same area as your clientele tends to keep honest people honest.  The consequence of dishonesty served as a strong deterrent back then, because being a crook could get you run out of town.  A similar relationship existed between employer and employee, for the same reason.  If the townsfolk found out that a business owner treated employees poorly, word spread quickly.

The industrial revolution changed all that.  In today's modern society, large business executives very rarely interact with their customers, and only with the upper echelon employees.  As a result, it's easier for top-level company executives to anonymize and dehumanize their customers and employees.  Human nature has demonstrated that it's easier to screw someone you never see.  To clarify, this screwing can take many forms, such as price gouging, poor quality products, toxic waste, and inhumane treatment of labor.

The funny thing is that America had learned this lesson, but we seem to have forgotten it.  The government created anti-trust and labor laws during and shortly after the industrial revolution specifically to address this problem.  Unfortunately, we seem to have lost the experience, because starting in the 1970s or so, we stopped enforcing these laws in the name of increased profits and efficiency.  I'd love to think that the pendulum will eventually swing away from consolidation, but I'm not going to hold my breath.  As I said at the outset, I understand that large corporations can serve a purpose.  But I believe that we've taken it too far by allowing companies to grow just for the sake of larger profits, where society in general gets nothing in return.