______________BP______________ __________Too Big to Fire__________

Government to BP Oil:  “You’re fired!”

It won’t happen.

_________________________________________________________________________________

Let’s play back the tape and see what the recurring theme is:

Investment and Mortgage Banking – Too Big To Fail

Health Care System – Too Big to Fix

American Automobile Industry – Interconnected Industries Too Big to Let Die 

       and, most recently:

Big Oil Blowup –  BP Oil Technology Too Complicated for Federal Takeover – Hence, BP Too Big to Fire

It is not a curious matter that none of the above occurrences represent government that is too big.  Rather, they represent corporate bungling on a scale so immense that government ended up being the controlled and not controlling one.  The very nature of larger and larger corporate size through loosely regulated market consolidation has, with greater frequency, backed the Federal government into a corner.   The government in case after case has essentially been forced  to reactively capitulate to corporate fumbling, incompetence, and other sorts of mishaps;  because to not do so would cause even more harm to its other constituencies.

A corporation’s successful development in America is a race to be the first (or second) to the top.   To be the first (or second) is usually the formula to be the biggest.  Entrepreneurial discovery,  innovation, and product development is a race to the patent office, then to the venture capitalists and banks; and, finally, a race to go public.  If a company can be the first to go public, it can be the first to generate the massive funds to scale up and get its name and product out there first.  This is immensely important because it  provides the means to dominate the market by acquiring its smaller, but potentially dangerous, competitors.  It’s not that competitors products wouldn’t prove to be better, it’s usually that the competitors are smothered by the avalanche when beaten to the punch.  The losing competitors are usually left the scraps of only being able to eat around the edges of the big, new pie.  The slow, chiseling background sounds of competitors are  just a reminder to the winner that it needs to continue its voraciousness to dominate.

An inevitable result is that most industries mature into a couple or maybe a few dominant players.  These dominant players, in effect, end up by virtue of their early success in controlling large parts of societal infrastructure.  The reliance upon this infrastructure is usually so great and so widespread that even minor disruptions, glitches, or upheavals of the dominant players are immediately and widely felt. 

Recall a while back when Twitter had a very brief technical mishap that disrupted its service.  Half of the United States seemed to go aflutter or atwitter over this.  Think of brownouts or temporary power outages by utility companies, cellphone system mishaps, or internet service provider interruptions.  These are relatively small inconveniences that cause palpable public panic attacks.  When e coli or salmonella outbreaks threaten, it causes systemic fear.  Bad milk, tomatoes, apples, lettuce, spinach, or beef cause havoc throughout society because of the reality that big corporations control so much of the food sourcing.   If Tyson Food has gas, the chicken industry burps in disharmony. 

When the scale of problem becomes a notch or so higher on the calamity scale, all hell can (and does) break loose.  I think that it’s time for the United States to take a necessary and healthy step forward and begin to regulate the extent to which a company can gain market share.  We have seen more than enough of the steroidal corporations that dominate to the point of societal damage.  The benefits to society of the economies of scale have a ferocious proportional step-brother – the massive disasters that occur when the incompetent or greedy side of scale reveals itself.  These corporate catastrophes not only paralyze society; they render government virtually impotent.

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Published in: on May 28, 2010 at 6:38 pm  Comments (3)  
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