Radical socialist groups like Antifa and Black Lives Matter and ideologically sympathetic individuals ravage and destroy American businesses, swearing to dismantle the “evil corporations” and “rich, white billionaires.” They demand suffocating regulation on businesses as well as extensive welfare programs. To them, these large corporations are the sole propagators of injustice in America and represent the greatest obstruction in their quest for a socialist utopia. They have endless rhetoric to back their claims, but do they have proof? Is it possible the very entities they “oppose” are, in fact, their most significant and most powerful allies? As ironic as it sounds, “big, evil corporations” and “rich, white billionaires” are, undoubtedly, the premier beneficiaries of socialism. As the marketplace is flooded with government intervention, these “too-big-to-fail” corporations peek their heads above water to remain breathing, while their competition—and the individual—drown below their feet. The cycle of regulation and wealth distribution allows the “big, evil corporations” to consolidate the lion’s share of the economy into their respective business empires.
Through government-enforced regulations, behemoth corporations shackle their competition. These regulatory costs can be broken down into four major categories: occupational health and safety, tax compliance, environmental fees, and economic regulations (rules that govern decision making in market transactions). According to a study conducted by the National Association of Manufacturers (NAM), it costs the average American business almost $10,000 per employee to comply with federal regulations annually.1 However, this $10,000 per employee is merely an average. The amount that is paid by the business largely depends on the size of the company. A business with less than 50 employees pays a whopping $11,724 per employee, while over 100 employees pay a much less at $9,083.
The difference in the financial burden resulting from regulation can be attributed to more massive businesses offshoring production and, therefore, pollution. Buying occupational health and safety supplies and insurance in bulk and having greater access to market-related opportunities that smaller businesses do not. Regardless of why this discrepancy in regulatory costs exists, the fact is that small businesses, which make up roughly 98% of all companies, are disproportionately affected by them. Per employee, a small business has $2,000 less than the large corporation to reinvest in R&D projects, employee initiatives, or debt reduction. Crippled with absurdly expensive regulatory costs, these small businesses raise prices and, consequently, drive customers away in a desperate attempt to remain profitable. The larger companies are happy to comply with the regulatory burden. As time progresses and small businesses are forced to quit, these large businesses assimilate an even more significant market share percentage.
Costly regulations on businesses, combined with wealth redistribution to the lower class, create the perfect storm for money to flow back into the pockets of the “big, evil corporations.” As mentioned above, regulations disproportionately affect small and medium businesses, forcing them to adjust to compensate for this revenue loss. In many cases, this readjustment takes the form of higher costs at the point of sale. The consumer, especially those who hover near or below the poverty line, are looking to purchase the cheapest products. Big corporations are already at an advantage considering this fact since they generally offer a more affordable product than their smaller competitors. Therefore, by pumping millions in extra funds to the lower class of society, wealth redistribution to the poor essentially becomes wealth redistribution to the rich. The impoverished are merely used as a middleman to complete the cycle of redistribution. Because large corporations can circumvent many of the regulatory costs of operation, they can keep more revenue in their pockets. The idea of “free money” appeals to many, but would it still be appealing if its advocates knew that it helps line the pockets of their “oppressors?”
In the body of the free market, businesses are flora, socialist policies are antibiotics, and “big, evil corporations” are antibiotic-resistant bacteria. As regulation kills off the vulnerable businesses, the regulation-resistant corporations rapidly multiply and fill the vacuum left in the market—thus, the irony of socialism is revealed. The actions implemented to prevent the dominance of mega-corporations ironically contribute to their development. Blind to this fact, the average socialist continues to advocate for more socialist influence in the government, not realizing that their perceived enemies are aiding them by providing platforms, funds, and talking points to complete their goal.
About the Writer
This contributor is a 26-year-old man who currently resides in South Georgia. He grew up in Irvine, California, and is currently pursuing a degree in Political Science in hopes of one day becoming a lawyer. Due to his line of work, he must remain anonymous for the next few months.