The Grants, in annual visits to Daphne Major, one of the Galápagos Islands, watched evolution—which Darwin had assumed worked slowly, over aeons—transform the finches of the island several times in response to severe environmental stresses.
The first time was in 1977, when a drought hit the island hard. This island was already a relatively barren and sparse environment, and the drought decimated the smaller and less hardy vegetation, browning the island and killing off the source of smaller seeds. The result was that the finches with smaller beaks, who couldn’t crack open the remaining larger seeds, died off.
In 1978, the offspring of the survivors of that drought had universally larger beaks—an environmental adaptation that took less than a year to happen.
It happened again—differently—during a two-year period of unusually rainy weather, 1984–85. All that moisture favored the smaller plants, which exploded across the island, and the finches with smaller beaks were able to eat those seeds without expending as much energy flying around carrying larger, heavier beaks like their relatives. And, sure enough, by 1986 small-beaked finch populations were back up to high levels.
Not only did evolution happen but it also cycled back and forth in response to a changing environment.
To the extent that economics can be described as an ecosystem—and the resemblances are many—it’s not hard to see how different economic environments are suited to different types of people.
In the wake of an economic crash, psychopaths would not be favored. Instead, the environment would be best adapted to people who are not perceived as risk takers, who have a high level of social commitment, and who are slow-and-steady builders of businesses. Classically, these were the CEOs and senior executives who followed business models that were prevalent in the half century following the Great Depression—CEOs who took only thirty times what their bottom-paid employee received, who typically had been more than twenty-five years with their own company before reaching the level of CEO, and who were not compensated in a way that was tied to stock prices.
During this period, CEOs were answerable to the workers (via labor unions), the company (via its board of directors), and the community (via local/state/federal government and community pressure). They were paid exclusively by salary and bonus—the tax code did not provide for compensating CEOs with stock or stock options. It was also during this period that some of the largest, strongest, and most resilient of American corporations were built.
Similarly, there were protections built into our business systems to allow for competition—particularly small, local competition—thus giving entrepreneurs an opportunity to step into the marketplace. If big corporations got too big, they were broken up, using the Sherman Antitrust Act of 1890 (among others).
But, eventually, the Great Forgetting took hold. And the Royalists and their madness crept back in.
Monopolies Return
Under the watch of the Royalists, the Reagan administration was philosophically opposed to the government breaking up companies. Over the next few decades, the monopolies of the Gilded Age returned.
On Wall Street, the twenty biggest banks own assets equivalent to 84 percent of the nation’s entire GDP. And just twelve of those banks own 70 percent of all the banking assets. That means our entire banking system relies on just a few whales that must be saved at all costs from going belly up, or else the entire system goes belly up.
And consider our food industry. According to Tom Philpott at Mother Jones magazine, agriculture oligopolies exist from farm to shelf. Just four companies control 90 percent of the global grain trade. Just three companies control 70 percent of the beef industry. And just four companies control 58 percent of the pork and chicken industry.76
On the retail side, Wal-Mart controls a quarter of the entire US grocery market. And just four companies produce 75 percent of our breakfast cereal, 75 percent of our snack foods, 60 percent of our cookies, and half of all the ice cream sold in supermarkets around the nation.77
And then there’s the health insurance market. Just four health insurance companies—UnitedHealth Group, WellPoint, Aetna, and Humana—control three-quarters of the entire health insurance market. And as a 2007 study by the group Health Care for America Now uncovered, in thirty-eight states, just two insurers controlled 57 percent of the market. In fifteen states, one insurer controlled 60 percent of the market.
Since there’s no functional competition in such a market, prices continue to get higher and higher while the profits for these whales skyrocket, too.
In the cellular phone market, just four companies—AT&T Mobile, Verizon Wireless, T-Mobile, and Sprint Nextel—control 89 percent of the market. And in the Internet market, just a handful of corporations—AT&T, Comcast, Time Warner, and Verizon—control more than half of the market.
From newspapers to television, radio to movies, monopolies dominate the markets.
If we were to give the Internet oligopolies the same treatment Richard Nixon gave AT&T in the 1970s, then maybe we Americans would have the same superfast Internet speeds and supercheap rates enjoyed by most of the rest of the developed world. For example, South Koreans get Internet speeds two hundred times faster than what most Americans get, and pay only $27 a month for their service. Professor Susan P. Crawford, author of Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age and former board member of ICANN, told me that while the average American consumer pays around $90 a month for a cell phone with a data plan, the European average is just $19 (and the coverage is better and the data is both faster and unlimited).78
Rising health-care, food, and energy costs can all be traced back to this problem of monopoly in America.
It’s a Second Gilded Age, and it’s headed for another Monopoly Endgame. And this time it will be worse than before.
We are no longer dealing with the Robber Barons, who savaged working people through the last half of the nineteenth century. And we aren’t talking about the Economic Royalists of FDR’s day, who plotted a coup. This is a new form of Royalist.
As Pulitzer Prize–winning journalist Chris Hedges told me, “The Robber Barons, however feudal they were, ran their enterprises within the nation-state itself. Now, we have corporate entities which seek the lowest possible wage around the world, in essence the prison labor in China, and are forcing the rest of the planet’s workforce to compete with this slave labor.”79
He went on describing the Royalists at work today. “It’s similar to the age of the Robber Barons but in fact worse because there is no loyalty to the nation-state. The corporations are actually hollowing the country out from the inside… We’re creating a kind of neofeudalism.”
Global Psychopaths
In his book The Collapse of Globalism, author John Ralston Saul lays out the primary driving ideology of globalism, which was unleashed on the world on a scale not previously seen before with the creation of GATT, the WTO, and NAFTA.