“There is little if any evidence that increased corporate size in already-large national and international firms produces greater technological innovation,” writes Elizabeth Sanders, Professor of Government at Cornell University. “To the contrary, it probably leads to less, given lower competitive pressures, and the starving of research in debt-burdened companies.”

Sanders writes the annual value of corporate consolidations --- led by telecommunications, banking, broadcasting, chemical, and pharmaceutical companies---jumped 100-fold between 1980 and 1999, reaching three trillion dollars in the latter year, with cross-border mergers making up one third of the total.

“After the dust has settled, thousands of employees fired, surplus executives generously pensioned off and a vast new debt accumulated, the merged giant usually performs less well than did its major components formerly, and the stock price goes down in recognition of less favorable prospects,” Sanders writes in an article titled “Antitrust and American Democracy,” published in The Long Term View, a journal of informed opinion published by the Massachusetts School of Law at Andover.

Fifty-one of the 100 largest economies in the world are not countries but global corporations, Sanders points out, and the top 200 corporations now account for over a quarter of the world’s economic activity. “Consolidation has unleashed behavior for which the term ‘robber baron’ seems too tame,” Sanders writes.

“Many mergers appear designed more to create new opportunities for the enrichment of CEOs and favored stock purchasers (and to gratify testosterone-fueled empire building?) rather than to shuck off excess capacity, create new ‘synergies’ or reap economies of scale.”

 “We have seen the shocking results in 2001-2002, as giant after giant reveals financial chicanery that enriched the managerial elite while looting the company, to the severe disadvantage of workers, pensioners, stockholders, and communities.”Sanders writes of “a broad expectation among businesses and citizens that conspiracies in restraint of trade, and other methods of unfair competition, will be prosecuted.”

The author notes the major antitrust laws of the 20th century --- the Clayton and Federal Trade Commission Acts of 1914, the 1950 Celler-Kefauver Act, and the 1976 Hart-Scott-Rodino Antitrust Improvements Act---all originated in and were passed by Democratic Congresses.”

Under President Ronald Reagan, by contrast, “consumer welfare” was “conceptualized almost solely in terms of the price of goods and services, stripping away the broader democratic concerns that had once been at the center of antitrust philosophy.

”With few cases worth prosecution, Sanders noted, antitrust staff and budgets under Reagan were slashed, so that Antitrust Division personnel in the Justice Department dropped to half the level under President Jimmy Carter, while “merger and monopoly case filings dropped to half the level of 1970, and only the most extreme horizontal mergers were now suspect; vertical and conglomerate mergers were of little or no concern.”

Sanders said if there is to be any revival of antitrust activity it will have to come from state attorneys general acting in behalf of state residents or from the European Union. The world, however, needs a strong U.S. antitrust policy, Sanders writes, not only because the U.S. worked hard over more than a century to develop one but because it is urgently needed today.

“It is time, not to abandon it(antitrust policy), but to share it, to reinforce the fledgling efforts of other nations to develop their own policies, and to cooperate in the development of a tough international policy against economic concentration and corporate bullying.”

The Massachusetts School of Law, Andover, is purposefully dedicated to the education of minorities, immigrants, and students from low- and middle-income backgrounds that would not otherwise be able to obtain a legal education. Views expressed in The Long Term View are not necessarily those of the Massachusetts School of Law at Andover.                                                           #(Further Information, Jeff Demers at MSL demers@mslaw.edu, or Sherwood Ross, media consultant to MSL, sherwoodr1@yahoo.com )