Comments (11)

• David C

  When I was young, naive and in school - I used to think that corporate America was the top of the mountain. Now I think that they are clumsy, stupid, can't execute, and most could't figure out a free market if their life depended on it. Some rely on patents or copyrights, some rely on regulations (they may or may not have paid for), some on special government contracts, some rely on the funny Ben money system, other's on freely provided government infrastructure. But most, they just rely on the fact that only a billion dollar company can afford the army of lawyers needed to deal with all the tax, hr, and other crazy regulations. The biggest myth in the world is that big corporations would benefit the most from rolling back the size of government. The truth is that many of these companies are really like 1000's of little companies pounced into a big fat mega-structure - which is there only because if the companies were on their own they would be sued, taxed, and regulated out of existence.

  IMHO a smart company would realize this, and let their sub sections be managed independently, compete, merge, acquire and destroy each other inside or outside the corporate walls. They would let them hire and fire at will, operate tax free, and let the bean counters and hr lawyers figure out what to do to appease the federal gods after the fact. They would not do things like get into global car rental agreements, global software agreements, implement global hr policy, or global phone company agreements, or global health care agreements that save money at the expense of independence. And grand strategic market master plans would not be imposed from the top, but independently organized from below and would not necessarily be within the company. IMHO, an effective corporate leader would concisely understand which parts of their mega company are mega because of free market forces, and which parts are mega because of coerced systems - and then apply that understanding to create a "true" free market zone inside the mega-structure where that zone acts as a revenue generator for the business, while the rest of the business is dedicated to fighting back the dogs and minimizing the coercive dampening effects of government.

  Published: May 23, 2006 1:01 AM

• tdl

  What exactly do these maps prove? I am a bit confused as to what the point is. Are you implying that b/c there a few degrees of seperation b/n two competitors that they will be unwilling to compete with one another? How is using the example of only several dozen of the Fortune 500 evidence that some type of "collusion" is occurring? If these corporate titans are cooperating, does it matter?

  Published: May 23, 2006 9:44 AM

• TGGP

  Is theyrule.net officially socialist, or is this: http://www.theyrule.net/html/category.php?category=socialist
  just giving me the wrong impression?

  I'm awful tempted to go to their comments section and say that yes, the wealthiest families in America that contribute these corporate board members are on average "genetically superior" to the bulk of the American populace with respect to running a large company. The problem is that they'd have to scroll down a few pages of smam-bot gibberish, by which time such a trollish message would result only in apathy.

  Published: May 23, 2006 9:49 AM

• Vince Daliessio

  We blogged it on our site;

  http://www.libertyguys.org/articles/detail.asp?ArtID=1358

  Look, I'm a confirmed anarcho-capitalist. But I'm not blind - the leadership ranks of these companies are clearly quite clubby if not overtly collusive.

  Murray Rothbard articulated the capture and control of the US government by the Morgans, Chases, and the Rockefellers here;

  http://mises.org/rothbard/WSBanks.pdf

  Clearly as the pie has been enlarged substantially since then, there are a few more players. But the same handful of elites control both big business and big government. Democracy is simply a ruse to allof them to parlay pelf into profits, and profits into power. In an anarcho-capitalist system, things would be, er, will be radically different.

  As we watch the continued collapse of two of the enterprises' biggest components (Ford and GM) due to competition outside of the enterprise, this fate becomes apparent. When the excrement hits the rotary ventilator, it will not be pretty.

  Published: May 23, 2006 10:40 AM

• tdl

  I still fail to see where competitors sitting on a third party boards w/ one another automatically eliminates competition. Some of the examples, like Lowes & HD, or BUD & Molson/Coors would go against the argument that competition does not exist. These are often aggressive competitors. I am not arguing we live in a pure free market society, I simply do not see how this is evidence for a lack of competition. Furthermore, when was the last time the Morgans or the Chases actually had any influence outside of their social circles?

  Published: May 23, 2006 1:01 PM

• Tim Swanson

  In "Linked: How Everything Is Connected to Everything Else and What It Means," the author Albert-Laszlo Barabasi empirically validates this observations, that many board members from large Fortune 500 companies sit on more than 2 boards of these same firms.

  One big, small world.

  Published: May 23, 2006 3:05 PM

• Bill

  There are two possible reasons for this:
  1. These folks are best managers and corporate owners hire these folks to get the best return on their money.
  or
  2. These folks are experts at getting government favors and a share of the money so the corporate owners are forced to hire them to get a return on their money.

  SO...

  The ONLY solution is to make government smaller. If government spends 3% of GDP as it did for the majority of the existence of this great nation, then the amount for large organizations to take would be minimal and corporat owners would focus on reason 1 for nominaating directors. But if the government hands out 25% of GDB then there are trillions of good reasons to hire directors for reason 2.
  

  Published: May 23, 2006 6:15 PM

• Jim

  Absent government interventionism leading to the granting of special privileges or monopoly rights, it doesn't matter who sits on which board of directors. As long as there is freedom of entry, any nepotistic board with soon be leading a failed company as the upstart steal its market share.

  Any issue you have with the web of influence is only problematic due to government controls and regulations

  Published: May 23, 2006 8:47 PM

• Vince Daliessio

  Jim said something I presumed was implied by my post;

  "Absent government interventionism leading to the granting of special privileges or monopoly rights, it doesn't matter who sits on which board of directors. As long as there is freedom of entry, any nepotistic board with soon be leading a failed company as the upstart steal its market share.

  Any issue you have with the web of influence is only problematic due to government controls and regulations."

  I presumed that you all knew that absent the corporatist state, I would have little or no interest in who populates the boards of these companies, except as a matter of curiousity.

  But since we DO live under a form of fascism, the people who populate these boards very much matter to us ordinary shlubs - not only do their board decisions radically affect our lives, they abuse our rights and property simply by continuing to draw breath, since their every thought and move has profound implications brought about by the tight ties between Big Business and Big Government under our current system..

  Published: May 24, 2006 8:49 AM

• Paul Marks

  In spite of all the government regulations and subsdies that support them (which they would not need if the Marxist view of economics were correct) many large corporations decline over time. Indeed they still go bust.

  
  What would be more interesting (indeed what I had thought you were going to do when I came upon your "who owns corporate America" article) would be to see how much taxes (such as capital gains tax) and regulations (such as the Williams Act of 1967) have undermined individual ownership of the stock of corporations.

  What percentage of shares are still owned by indiduals and what percentage by trusts (hence the tag "trust fund kids") or (more importantly) such financial institutions as pension funds.

  As recently as 1965 most shares were still owned by individuals in Britain. What is the situation in the United States? And does it vary much among the largest corporations?

  That would be interesting.

  "Look, some people sit on more that one board of directors" is not.

  Published: May 24, 2006 10:04 AM

• mp

  I think you both missed the point tdl and Paul Marks.

  Published: May 25, 2006 9:08 PM