How corporate mergers make consumers and workers powerless
Thanks to the consolidation of the airline, Internet, and other industries into a few large companies, American workers and consumers have fewer choices than we used to have. In almost every area of our lives, it’s now take it or leave it.
A security guard recently told me he didn’t know how much he’d be earning from week to week because his firm kept changing his schedule and his pay. “They just don’t care,” he said.
A traveler I met in the Dallas Fort-Worth Airport last week said she’d been there eight hours but the airline responsible for her trip wouldn’t help her find another flight leaving that evening. “They don’t give a hoot,” she said.
Someone I met in North Carolina a few weeks ago told me he had stopped voting because elected officials don’t respond to what average people like him think or want. “They don’t listen,” he said.
What connects these dots? As I travel around America, I’m struck by how utterly powerless most people feel.
The companies we work for, the businesses we buy from, and the political system we participate in all seem to have grown less accountable. I hear it over and over: They don’t care; our voices don’t count.
A large part of the reason is we have fewer choices than we used to have. In almost every area of our lives, it’s now take it or leave it.
Companies are treating workers as disposable cogs because most working people have no choice. They need work and must take what they can get.
Although jobs are coming back from the depths of the Great Recession, the portion of the labor force actually working remains lower than it’s been in over thirty years – before vast numbers of middle-class wives and mothers entered paid work.
Which is why corporations can get away with firing workers without warning, replacing full-time jobs with part-time and contract work, and cutting wages. Most working people have no alternative.
Consumers, meanwhile, are feeling mistreated and taken for granted because they, too, have less choice.
U.S. airlines, for example, have consolidated into a handful of giant carriers that divide up routes and collude on fares. In 2005 the U.S. had nine major airlines. Now we have just four.
It’s much the same across the economy. Eighty percent of Americans are served by just one Internet Service Provider – usually Comcast, AT&T, or Time-Warner.
The biggest banks have become far bigger. In 1990, the five biggest held just 10 percent of all banking assets. Now they hold almost 45 percent.
Giant health insurers are larger; the giant hospital chains, far bigger; the most powerful digital platforms (Amazon, Facebook, Google), gigantic.
All this means less consumer choice, which translates into less power.
Our complaints go nowhere. Often we can’t even find a real person to complain to. Automated telephone menus go on interminably.
Finally, as voters we feel no one is listening because politicians, too, face less and less competition. Over 85 percent of congressional districts are considered “safe” for their incumbents in the upcoming 2016 election; only 3 percent are toss-ups.
In presidential elections, only a handful of states are now considered “battlegrounds” that could go either Democratic or Republican.
So, naturally, that’s where the candidates campaign. Voters in most states won’t see much of them. These voters’ votes are literally taken for granted.
Even in toss-up districts and battle-ground states, so much big money is flowing in that average voters feel disenfranchised.
In all these respects, powerlessness comes from a lack of meaningful choice. Big institutions don’t have to be responsive to us because we can’t penalize them by going to a competitor.
And we have no loud countervailing voice forcing them to listen.
Fifty years ago, a third of private-sector workers belonged to labor unions. This gave workers bargaining power to get a significant share of the economy’s gains along with better working conditions – and a voice. Now, fewer than 7 percent of private sector workers are unionized.
In the 1960s, a vocal consumer movement demanded safe products, low prices, and antitrust actions against monopolies and business collusion. Now, the consumer movement has become muted.
Decades ago, political parties had strong local and state roots that gave politically-active citizens a voice in party platforms and nominees. Now, the two major political parties have morphed into giant national fund-raising machines.
Our economy and society depend on most people feeling the system is working for them.
But a growing sense of powerlessness in all aspects of our lives – as workers, consumers, and voters – is convincing most people the system is working only for those at the top.
The Christian Science Monitor has assembled a diverse group of the best economy-related bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. This post originally ran on www.robertreich.org.