Matt Stoller is one of the most interesting people on the Left, in our view. His work focuses on antitrust and antimonopoly research–work that has received newfound respect and interest on the Right as the Right has grown to question corporate power in America and to grope towards some form of “working-class populism”. Another thing that makes Stoller appealing is that he recognizes the elitism of the institutional Democratic Party and how often it shows contempt for regular people, and the ways in which intersectionality and social issues are used by pro-Democratic monied interests to distract from economic issues. He is willing to call out his own side. Intellectually-honest leftists are an endangered species and we like them.
Stoller’s book, which is a fascinating history of monopoly and anti-monopoly in the US and which you should read, is titled Goliath: The 100-Year War Between Monopoly Power and Democracy. His newsletter, BIG, which looks at how monopoly power has infected virtually every aspect of American life (it’s striking!) is here. You can also follow him on X dot com here.
Our interview is below. It was conducted over instant messaging and was lightly edited for clarity.
PolicySphere: We’ve wanted to ask you this question about your book. What we found most fascinating about it is that you’re not really or not primarily making an economic argument against monopoly. You don’t get bogged down in macroeconomic modelling and discussions of customer surplus. Instead your argument is primarily political, and it’s an anti-bigness argument. To you, all big institutions, especially money-driven ones but not only, are inherently corrupting to a healthy citizen-led democracy, and so monopolies should be ipso facto considered evil. That’s an argument that has lots of resonances with conservative thought. We especially liked the bit where you tried to uncancel Jefferson.
Matt Stoller: I would make that point more precisely. I’m concerned about arbitrary coercive power, and the main source of that today is big business, which is to say, a set of legal arrangements that consolidate assets into the hands of distant masters.
We have to divide ‘big’ into multiple buckets. There’s operational scale, which isn’t bad. Lots of big things are great. America is big. The internet is a very big network. GPS covers the whole world. Car companies are big and we need cars.
But then there’s legal scale, and that’s what I’m concerned about, because that leads to arbitrary coercive power. For example, in the 1980s, GM was the biggest car company in the world, but it was a collection of relatively small inefficient factories. Honda’s factories were much larger, but it had fewer of them. So legally GM was ‘bigger’ than Honda but Honda had greater economies of scale.
I’m opposed to arbitrary concentrations of power not operational scale. It is a republican philosophy, because it’s about checks and balances as they play out in commerce as well as government.
PolicySphere: Here, a conservative or libertarian would say that companies, even very big ones, even maybe monopolies or at least some monopolies, don’t have arbitrary coercive power, because they can’t put a gun to your head and make you do something. How do you respond to that?
Matt Stoller: Well here’s a businessman quoted in the WSJ on the exposure he needs from Google. “It’s less harmful to piss off the government than piss off Google. The government will hit me with a fine. But if Google suspends my listings, I’m out of a job. Google could make me homeless.”
The premise that the only means of exercising power is through violence is not accurate. There are many ways of exercising power, and dominant firms who run key infrastructure on which we rely have many levers they can use.
We have traditionally recognized this dynamic. For instance, no one is afraid that the electric utility will just cut off power to their house if they complain because there are rules that require universal service. But if there weren’t rules, obviously the dynamic would be different.
In a sense, libertarians are like fish who can’t see the water they swim in. Obviously they would be uncomfortable with a situation where an electric utility cuts off your power if you anger the CEO or make a complaint. But that’s something they never have to think about because of rules put in place long before their movement started.
PolicySphere: Another thing that was striking in your book was the story of how the consumer rights movement inadvertently played into the hands of monopoly. Both the conservative and the progressive pro-monopolist take the perspective of the consumer, they say, ok, if a monopoly abuses its position in some ways, especially by raising prices, that may be bad, but if consumers are getting a good deal, then nobody’s harmed. Why is that perspective wrong?
Matt Stoller: The main change was to shift from regulators being concerned about balances of power to them only thinking about welfare maximization. The consumer welfare framing was really just window dressing.
To put it a different way, regulators, legislators, and judges used to use common sense. Is this business practice coercive? If yes, then it’s unlawful. Will this merger cut the number of corporations in the market in a meaningful way? Then it’s unlawful.
The change was to ask, ‘is this business practice or merger going to lead to more or less output?’ To answer this question, they would turn to opaque economic models that used price theory to make guesses. The claim was that they were focused on consumer prices. They weren’t, they just wanted to eliminate anti-monopoly rules by hiding their political assumptions in technocratic jargon. Their models are garbage. But they are snobs and don’t like normal people having a say in the economy.
The reason this worked on the consumer rights movement in the 1970s is that a lot of them were snobs as well, and didn’t particularly like honest business or working people.
That tradition of snobbery carried forward. Bill Clinton had an everyman political vibe, but his whole administration was staffed with Rhodes Scholars. Obama was a massive elitist, as was his entire apparatus. Biden is much less snotty than those guys, though the institutional coalitions he’s dealing with are full of the Clinton/Obama residue.
On the right it’s a bit different, they just worship money making via finance. That hasn’t really changed, though there are indications it might.
PolicySphere: What do you think would have to happen for the Right to become more anti-monopoly? Please say something constructive, and not “Stop being evil greedy bastards” or something.
Matt Stoller: The problem intellectually for conservatives is that they really want what a government can deliver, but they don’t want a government.
Take immigration and corporate power. The Biden administration recently went after Walmart for violating the law regarding hiring undocumented immigrants, and took them to court in an internal administrative proceeding. Walmart argued that the internal administrative proceeding was unconstitutional, and got a conservative judge to agree and block the crackdown on the grounds that only Federal judges can make such determinations. Good luck with the massive backlog in Federal courts getting any case like this heard in the next few years.
If you want to govern, you have to have a government!
Another good example is the nonstop Republican attack on the IRS and the money the Biden administration put there. Basically what the IRS has spent the money on is auditing rich people and having enough customer service reps during tax time. But the right is obsessed with gutting the IRS out of some misplaced view that taxing is tyranny. Sorry but there’s no state without the institutional capacity to tax. What do they think tariffs are?
Another example is the TikTok bill. The GOP is deathly afraid of expanding any authority whatsoever to the executive branch. Their bill is one way to address the problem of TikTok, but there are others. However, they will not accept any modifications whatsoever that expand executive authority, even to backfill and let BIden do what Trump tried to do in 2020 with TikTok but was stopped by the courts. They are so afraid of any domestic government authority that they would prefer to have China run our communications system rather than give Biden a smidge more capacity! Are they anti-government or just anti-American government
Fundamentally if you want to address coercive corporate power you have to do that collectively through law and public institutions. The right hasn’t figured out how to reckon their historical neoliberal distrust of all public institutions and collective action with their desire to address, say, big tech. They want common carriage rules, which is great, but no administrative state to enforce them
There’s just a lot of intellectual incoherence conservatives have to work through.
PolicySphere: If I’m a right-winger and I look at corporate power in America, I see forms of concentration and cronyism that I don’t like. But I also see an alliance—almost a fusion—between the elite precincts of Corporate America and the progressive left. The 2020 election was almost unprecedented in that regard in having nearly every monied interest in America exclusively on one side. Do you think that’s fair, and how do you explain it?
Matt Stoller: It’s obviously comically untrue. It’s true that Obama was hugely boosting Wall Street, but the Republicans were absolutely right there with him. And while it’s a nice idea to imagine the GOP establishment has changed, and there are some indications of that, by and large the Republicans are still in transition.
For instance, the GOP is heavily invested in expanding, say, Medicare Advantage, which is a $100B+ wasteful subsidy to giant insurance companies who screw everyone in the whole health care system, from doctors to independent pharmacists. I just saw an article about how House Republicans are seeking to expand high deductible health care plans. Who likes this crap? “Hey you’re sick, we think you’d like a second job dealing with weird financial charges.” UnitedHealth Group likes it.
80% of the GOP oppose antitrust reforms to strengthen that law. Nearly all of them in the financial services realm push for more power for private equity firms across the economy, most of them support electric utilities hiking prices dramatically, oil companies merging, et al. Giant defense contractors run policy through the GOP. Etc al.
Trump broke with this framework on trade, but elsewhere, not so much. There are a few areas where the realignment has made some progress, but by and large the GOP establishment is in thrall to big money for institutional and ideological reasons. So why doesn’t it appear this way? Well it’s the same reason Democrats can’t internalize the foreclosure crisis and bailouts Obama fostered. There’s an ideological block.
One of the hallmarks of the 1960s counter-culture was the view that having or exercising the authority granted to you by a democratic process was illegitimate. The only legitimate forms of action were in protest, because all forms of authority were inherently malevolent. This ideological framework is enormously powerful. It’s why Hillary Clinton was offended when Bernie Sanders called her part of the establishment. What a stupid reason to be offended, both of them are part of the decision-making group in America. Why be offended at that? But she was. And most Democrats don’t see governing as real, so they couldn’t imagine Obama acting with malevolence around the banks.
Similarly, conservatives cannot imagine that they have power and an alignment with Wall Street. Take any problematic thing that Republicans have done. For example right now I’m obsessed with Oregon Republicans blocking a bill to get rid of private equity ownership of medical practices. Conservatives want to believe that consolidation in health care is all because of Obamacare, and that progressives have corporatized our system. The truth is that it was Reagan who started the consolidation craze, it was Bush who created Medicare Advantage, and Obamacare built on top of that. But now it’s the progressives who are changing their minds, as was clear with that Oregon bill, and the Republicans who are holding onto corporatization.
The conservative response to Republican establishment people enacting bad policy is usually ‘well both parties are the same, it’s a swamp.’ That’s exactly how Democrats ignored that Obama was doing what he was doing, ‘yeah, politicians are in the pocket of Wall Street.’ It’s like, no, YOUR guy is doing this crap. If you got mad he’d have to stop.
The conservative picture of powerlessness is just inconsistent with reality. Both parties are coalitions with power. Both enact policies. But to acknowledge that is to show as inconsistent the comforting view that progressives and corporate CEOs are running everything. More to the point, this warm comfortable posture is in truth embracing a form of protest politics based on narcissism. If conservatives want to govern, they will have to overcome their addiction to the 1960s counterculture.
PolicySphere: Finally, the question we end interviews with: who’s the smartest person we should talk to?
Matt Stoller: Intelligence is overrated.
