Monopoly and Competition in Twenty-First Century Capitalism

By John Bellamy Foster, Robert W. McChesney and R. Jamil Jonna
Monthly Review
April 2011

John Bellamy Foster (jfoster@monthlyreview.org) is editor of Monthly Review and professor of sociology at the University of Oregon. Robert W. McChesney (rwmcches@uiuc.edu) is Gutgsell Endowed Professor of Communication at the University of Illinois at Urbana-Champaign. R. Jamil Jonna is a doctoral candidate in sociology at the University of Oregon. This is a chapter from Foster and McChesney’s Monopoly-Finance Capital: Politics in an Era of Economic Stagnation and Social Decline, forthcoming next year from Monthly Review Press.

A striking paradox animates political economy in our times. On the one hand, mainstream economics and much of left economics discuss our era as one of intense and increased competition among businesses, now on a global scale. It is a matter so self-evident as no longer to require empirical verification or scholarly examination. On the other hand, wherever one looks, it seems that nearly every industry is concentrated into fewer and fewer hands. Formerly competitive sectors like retail are now the province of enormous monopolistic chains, massive economic fortunes are being assembled into the hands of a few mega-billionaires sitting atop vast empires, and the new firms and industries spawned by the digital revolution have quickly gravitated to monopoly status. In short, monopoly power is ascendant as never before.

This is anything but an academic concern. The economic defense of capitalism is premised on the ubiquity of competitive markets, providing for the rational allocation of scarce resources and justifying the existing distribution of incomes. The political defense of capitalism is that economic power is diffuse and cannot be aggregated in such a manner as to have undue influence over the democratic state. Both of these core claims for capitalism are demolished if monopoly, rather than competition, is the rule.

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