Poll: Why we need economic regulation.

[zachatree]

As proven by recent economic events deregulation rapes the bum hole of the middle class.

 

[Eyclonus]

Communism is a political system that requires an excessively regulated economy.
Due to the government's constant intervention the only acceptable economic model for commies is a state-delegated monopoly.
However because the monopoly in this example is existing solely to ensure all citizens have a car, then it cannot set its own prices, the firm must make the maximum amount of cars it can in a year to meet the demand from the people. It can't raise prices to cover costs as that means they're supporting the evil bourgeois and upper-classes. So the government will have to pay the gap between how much revenue is gained from sales, and how much the firm needs to cover the costs of production.

If the government is pumping in money to support the industry, then it needs to tax the people to generate the funds, to support the firm that pays them their wages to make the cars the government is asking the firm to sell at a lower price so the workers can work to earn the income to pay the taxes to prop-up the monopoly.

Now that's just cars, if you add in everything else the soviets monopolised you'll see that the products that are used less by citizens but used up a larger percentage of the labour force, aka 7.62mm bullets, there is less money going to the workers to pay the taxes.
The soviet government made the utterly genius idea in the early years of banning economics alongside genetics and cybernetics/prosthetics as scientific disciplines. Because of this they failed to realise that the number of cars being bought in the economy was well below the number of cars being sold in the economy, or the tonnes of steel used to make the cars.

It gets better, due to the lack of economists to run around screaming "DOOM" most of their monetary policies were written by a group of 26 men, whose sole purpose was to reset the prices of every commodity, everything that could be bought/sold in the nation, everyday. These guys were good, for about 15 years, and in a pretty brief period they all defected/died/"disappeared". With no one to sit back and apply the Supply & Demand principles, the leadership took it on themselves to make the problem even more retarded.

Chief amongst these great ideas was the idea of printing more money and paying everyone with it, because to the stupid: "more physical money=money in the economy=money worth more value".

As opposed to the Western idea, learnt from post-ww1 Germany, that "more physical money=/=more money in the economy" and "more money in the economy+no change in production output+no change population+no change in production efficiency=national currency worth less than firewood".

Capitalism, like Democracy is used by the majority of developed countries because its the only system that guarantees a tomorrow, without a civil war or economic enslavement.

 

[Booze Zombie]

Why not try and make something else, though?

Like a council based system, with a large group of councils operating a country, with a council operating each state, with a council for each city, with councils below them managing water, electricity, gas, etc, as well as a council managing massive warehouses where all the basic stuff needed in modern life is given to all citizens (cookers, freezers, fridges, etc).

The state supplying basic "no thrills" stuff to all citizens, if these citizens have jobs, they can earn money which means they can buy the fancy stuff, as opposed to being stuck with basic equipment.

It's like Communism and Capitalism combine with Democracy... kind of.

 

[mark_n_b]

Um, the Soviet Union took the combined wealth of a dozen nations and built it up into bankruptcy. Germany is still undoing the damage done by communism to her eastern region. Red China was North Korea writ large until Nixon foolishly opened it up to the west, and still no better than Cuba blah blah blah

And the U.S. is on a virtual B-line to a full on economic depression. The question was name communist / socialist world powers, I tossed out a handful, and they were. And it wasn't communism that lead to the collapse of the U.S.S.R. it was corruption.

When the U.S. is replaced as a world power will we conclude that it never was? And you're relation of China seemed to ignore it's current and imminent future world position in the socio-economic spectrum, which I do believe I was talking about. No one can deny that China is a current world power, and its power as a nation is growing. Well I suppose you could, then you could say something about dancing, and I guess that is some way of proving how you are absolutely correct about everything and everyone else is absolutely wrong.

Personally, I find your selective reading kind of telling.

And while I am on this, who is the "we" that is being refered to in the thread title? Only one nation is really wrestling with the idea of financial regulation at this point, and this is not a American based website. While there is a population of yanks on here I am not sure that the term "we" is an entirely accurate statement.

--Oh look Steve seems to have tripped and spilled his Caesar all over the disco.

 

[werepossum]

Um, the Soviet Union took the combined wealth of a dozen nations and built it up into bankruptcy. Germany is still undoing the damage done by communism to her eastern region. Red China was North Korea writ large until Nixon foolishly opened it up to the west, and still no better than Cuba blah blah blah

And the U.S. is on a virtual B-line to a full on economic depression. The question was name communist / socialist world powers, I tossed out a handful, and they were. And it wasn't communism that lead to the collapse of the U.S.S.R. it was corruption.

When the U.S. is replaced as a world power will we conclude that it never was? And you're relation of China seemed to ignore it's current and imminent future world position in the socio-economic spectrum, which I do believe I was talking about. No one can deny that China is a current world power, and its power as a nation is growing. Well I suppose you could, then you could say something about dancing, and I guess that is some way of proving how you are absolutely correct about everything and everyone else is absolutely wrong.

Personally, I find your selective reading kind of telling.

And while I am on this, who is the "we" that is being refered to in the thread title? Only one nation is really wrestling with the idea of financial regulation at this point, and this is not a American based website. While there is a population of yanks on here I am not sure that the term "we" is an entirely accurate statement.

--Oh look Steve seems to have tripped and spilled his Caesar all over the disco.

The USSR fell because communism always fails to provide economic strength comparable to capitalism, simply because "From each according to his means, to each according to his needs" fails to reward hard work and ingenuity. Always has, always will. Humans just will not work as hard for some "greater good" as for the betterment of themselves and their families. Without similar productivity, no nation can long remain at the top; the choices are to embrace capitalism (e.g. China) or fall ever-further behind (e.g. USSR, Cuba, North Korea, Vietnam.) The Soviet Union made it to the top only through military action and stayed there only by raping the nations it had subjugated. When the accumulated wealth of its satellite nations had been used up, the USSR began an inevitable economic decline. Corruption is a natural and significant part of any Marxist system because it's the only way most people can get ahead, but even the cleanest Marxist economy is doomed to fall behind. Always have, always will. Similarly, Red China has become an economic powerhouse by embracing capitalism economically whilst retaining communism only as a political system. These things are not "selective reading", they are cold hard facts about the world as it exists, not as some might wish it to be.

The comment that "only Steve may dance" comes from a Family Guy bit about how Conan O'Brien dances in his seat whilst going to break. His guest began dancing in his seat, and Conan remarked "Sit perfectly still; only I may dance." As to whether I consider myself always absolutely correct about everything and everyone else is absolutely wrong", the point of my post was specifically that Steve was in fact more correct than I. Unless by "everyone else" being "absolutely wrong" you mean only yourself, that completely invalidates your point. Perhaps you should take a refresher course in reading for comprehension?

EDIT: Eyclonus, Stompy, Alone Disciple, BallPtPenTheif, and Saskwach may also dance.

 

[stompy]

[EDIT: Eyclonus, Stompy, Alone Disciple, BallPtPenTheif, and Saskwach may also dance.

**does a dance**...**is 'escorted' off the dance floor** **sad face**

 

[Eyclonus]

Why not try and make something else, though?

Like a council based system, with a large group of councils operating a country, with a council operating each state, with a council for each city, with councils below them managing water, electricity, gas, etc, as well as a council managing massive warehouses where all the basic stuff needed in modern life is given to all citizens (cookers, freezers, fridges, etc).

The state supplying basic "no thrills" stuff to all citizens, if these citizens have jobs, they can earn money which means they can buy the fancy stuff, as opposed to being stuck with basic equipment.

It's like Communism and Capitalism combine with Democracy... kind of.

Thats a communist monopoly system.

 

[milskidasith]

Why not try and make something else, though?

Like a council based system, with a large group of councils operating a country, with a council operating each state, with a council for each city, with councils below them managing water, electricity, gas, etc, as well as a council managing massive warehouses where all the basic stuff needed in modern life is given to all citizens (cookers, freezers, fridges, etc).

The state supplying basic "no thrills" stuff to all citizens, if these citizens have jobs, they can earn money which means they can buy the fancy stuff, as opposed to being stuck with basic equipment.

It's like Communism and Capitalism combine with Democracy... kind of.

So it's basically Democracy (the councils are pretty much ENTIRELY what the US is, except they are called the Senate, the House of Representatives, *insert state level branches of government*, and *insert committees and subcommittiees for both*) with people getting the free basic necessities of life? That's the US and welfare, buddy.

 

[Saskwach]

You guys keep fighting over Communism and Capitalism; I'm looking at Distributism [http://en.wikipedia.org/wiki/Distributism] myself. It works for fishermen [http://www.escapistmagazine.com/forums/read/18.72683#769120] and large Spanish corporations [http://en.wikipedia.org/wiki/Mondrag%C3%B3n_Cooperative_Corporation] (but say Basque if you don't want to hurt their feelings).

 

[stompy]

You guys keep fighting over Communism and Capitalism; I'm looking at Distributism [http://en.wikipedia.org/wiki/Distributism] myself. It works for fishermen [http://www.escapistmagazine.com/forums/read/18.72683#769120] and large Spanish corporations [http://en.wikipedia.org/wiki/Mondrag%C3%B3n_Cooperative_Corporation] (but say Basque if you don't want to hurt their feelings).

Wait, would you mind clearing that up for me? From what I'm reading, it's pretty much saying that you want to give every family tools in order to produce goods, which can then be distributed throughout the society. If so, what about those that make their living through administrative means? Or managerial? What tools are you going to give them, and what are they going to use to barter and obtain human necessities?

Perhaps I'm reading it the wrong way... mind explaining it to me?

 

[Rolling Thunder]

Okay- I'm going to be blunt: ALL OF YOU ARE WRONG TO A CERTAIN DEGREE.

To the Capitalists: Yes, the Soviet Union has crumbled, but during the 1930s it and the Nazis were the only nations with anything apporaching full employment. Also- there is nothing intrinstically inefficent about a command economy- the inefficency lies in the mixture of political dissent, dissatisfaction and a shift towards capitalist-style economics (Perestroika) that is the destructive force. Under Stalin, for example, the USSR was a superpower. As it was under Kruhschev. It was simplythe plethora of leaders afterwards that weakened it, due to their cavilling and bowing to international preassure.

Also, most 'Capitalist' polcies are contrary to Adam Smith's original treatise. Smith did not want monopoly, he did not want restrictions to trade, and he had no objection to the government providing certain goods (Public Goods etc) like healthcare or such where the market wouldnot.

The market can fail, gentlemen. Accept thatfact, and move on.

Also- unregulated capitalism sucks. See- E.P Thompson: Making of the English Working Class.


To the socialists: It is good to see we have some sane people around here. Now, eveybody- listen to the South-African based, half-Scot/Half-Englishman: Socialism is the majority form of government throughout the world. America practises it with Medicare and Social Security, Britain with the NHS(awesome!), Germany with something else, Sweden does it beautifully, even China's economy is part socialist.

Socialism works, because the Rich despise Communism, for they get screwed, and the Poor despise Caapitalism,for they get screwed. Neither system is one you would wish to live in, for as we all know extremes are very rarely comfortable for any of us.


To the Communists/Command Economists: True capitalism does work, just as well as true command economics, but as mentioned before, neither is very enjoyable, for it leads to a gross overconcentration of power. Communism is splendid for wars and establishing malevolent Empires that rule the world (actually, scratch that- Capitalist Empires are much better) and so on, but so is unregulated capitalism.

 

[Whiskyjakk]

Capitalism, like Democracy is used by the majority of developed countries because its the only system that guarantees a tomorrow, without a civil war or economic enslavement.

I completely agree! Communism and Socialism are simply impossible with human nature as it is. If you give the rich the power to make even more money by the use of inherited capital and investment, it makes a mockery of the Communist maxim that "those who work hard are financially rewarded". And how can you expect CEOs with almost complete autonomy to set their own salaries and bonuses to stay honest?

The Great Depression, Corruptocracies in Africa such as Zimbabwe and the periodic recessions have clearly shown that Socialism just doesn't work, but some people just can't seem to move on.

(Oops, maybe I meant Capitalism not Socialism, you know the economic model we aren't allowed to criticise because everyone knows it "works".)

 

[Rolling Thunder]

There is an edit button. Make use of it, before I begin a Swift-like polemic.

 

[werepossum]

The Soviet Union was never an economic superpower. The West thought the USSR was an economic superpower because it produced so much military equipment and had so many people, but analysis after the USSR died revealed that the West had greatly over-estimated the USSR's productivity by basing it on extrapolations from Western societies. The USSR survived as long as it did simply by devoting huge amounts of its workforce and resources to military production, leaving a population desperately poor by Western standards. Bluntly speaking, when the USSR ceased to grow it began to die. Only by beggaring its satellite states did it survive even fifty years, and none of the former Soviet satellite states have completely recovered (Ukraine being the closest, and East Germany of course after the reunification.) Again, a "command economy" is inherently inefficient because it commands workers to work for some undefined greater good, whilst their hard work and ingenuity do nothing for themselves and their own families. If working hard and not working hard produce the same reward, human beings will always not work hard. I don't care how many learned books are written, that's a basic fact of human nature. The closest thing you'll find to an exception would be religious-based societies (i.e. future reward) and the Chinese importance on the larger unit over the smaller unit - state over province, province over city or village, city or village over family, family over individual. But again, China was still dead poor before adopting capitalism, for example, building tanks with manual traverse and elevation into the eighties and with most of its population as subsistence farmers. This is what happens - every time - when reward is not proportional to effort and ingenuity, but is awarded based on ideological purity and cronyism. The only way to make a "command economy" approaching the performance of a capitalist economy would be to re-engineer humanity, which is why the ChiComs, probably the world's most dedicated communists, have embraced capitalism.

I don't think many people disagree that some measure of socialism is desirable in a society - the question is generally how much. There are three problems inherent in socialism, the first being a natural reduction in incentive (if the government takes most of your increases in pay there's less reason to work harder) and the second being the loss of freedom. A government that is big enough to give you everything you want is also big enough to take away everything you have. Or put another way, if the government increasingly treats you like children who need an allowance and help with day-to-day life, it will also increasing treat you like children, making more and more decisions for you about what you should and should not be able to do. The third problem inherent in socialism is that it tends to stratify society, to lock in socio-economic roles. A government that takes for itself the lion's share of unusually high earnings makes it quite difficult to move into the rich aristocracy, and those people who do tend to be closely involved with or related to (or both) those in power. Since no government can provide an upper class life for everyone by definition, those with money will always have large advantages - better education, better contacts - over the average Joe. Thus the more socialist a country becomes, the more its rich class becomes unattainable to others, and thus the more it becomes a hereditary class. This has a damping effect of ingenuity. This is important because so many of our advances come from people with a new or better idea and a burning desire to succeed. If the structure of society convinces you that no great rewards will be forthcoming, you're more likely to play video games with your free time than to perfect that new gadget you think everyone will want.

 

[Saskwach]

You guys keep fighting over Communism and Capitalism; I'm looking at Distributism [http://en.wikipedia.org/wiki/Distributism] myself. It works for fishermen [http://www.escapistmagazine.com/forums/read/18.72683#769120] and large Spanish corporations [http://en.wikipedia.org/wiki/Mondrag%C3%B3n_Cooperative_Corporation] (but say Basque if you don't want to hurt their feelings).

Wait, would you mind clearing that up for me? From what I'm reading, it's pretty much saying that you want to give every family tools in order to produce goods, which can then be distributed throughout the society. If so, what about those that make their living through administrative means? Or managerial? What tools are you going to give them, and what are they going to use to barter and obtain human necessities?

Perhaps I'm reading it the wrong way... mind explaining it to me?

I'm a bit confused, but I'll have a look at what I think you're saying.
I think you've confused yourself by thinking that the first step is to give this ideal family unit - the supposed smallest unit in standard distributist theory, which I'm not a hard and fast follower of - the tools to produce which they'd then control. What's actually being said is that the "family", which is already producing, thanks to the husband and/or wife going to work, will be given some ownership of their workplace. If you want to have a less ideologically inclined view then substitute "worker" for "family" - you have to bear in mind this theory was created by Catholics (G.K. Chesterton and Hilaire Belloc). To get to the base of what distributism is forget about families for the moment. "The family" was part of the social side of distributist thinking, which isn't important to a strictly economic view of it, just as a belief in subsidiarity or a support of Just War (both also in the article) aren't strictly necessary.
Distributism, to put it simply, says that workers should be given a share in the profits and ownership of a company - proper shares in the financial sense, usually. For, say, a factory, this would mean that the factory floor workers all have an equal share in the company from which they would receive much of the profits of the company, and would have the rights of shareholders - to ask questions of management, to demand certain things and to have a say in the decisions of the company. Basically, to cut away the chaff for the sake of understanding, distributism means capitalism where the workers are also shareholders. This, ideally, means that profits are shared more equally across the business, and decisions are made by and for the workers of that company.
To return to your question about managers and administrators, they are also workers for the company so they would also be shareholders. They would still handle the day-to-day decisions, though, much as they do in normal companies.

 

[stompy]

Post

Wouldn't that create a lot of red tape?

If someone is given shares in the company because they work there, and then they, for one reason or another, lose their shares, yet still work for the company, then what happens? They've lost their share in the company, and thus lost their entitlement to the profits of the company. In effect, they've lost income to provide for necessities, but still need to work for the company. Yet, to give back the employee their shares would devalue the value of the individual share because you're printing out shares, without any increase in value, resulting in a lower dividend overall (kinda like Germany in post-WW1, but that's another discussion).

Also, how do you determine the value of the shares given to each worker? To give the CEO and factory worker the same share would mean there would be no incentive to rise to the top of the company, with the common worker having the same influence and sway of the top decision maker. To give one party more power than the other would mean that the party with the smaller share will have less ability to demand change and make decisions.

My final question is, What about the government? You'll have to give people shares/stocks in the government, meaning you'll have the same problem as those in the hypothetical business. Also, what happens to social services then? Will this system ultimately become laissez-fare capitalism, meaning no social services what-so-ever?

Edit: Just though of this one: If all income is dependant on the amount of shares you own in a company, then what if the company tanks? This economic philosophy means there's no such thing as 'job security', meaning you will have a lower unemployment rate.

 

[Dys]

The only thingy remotely like communism is stalinism. I think you are getting it wrong, Communism has not ever been tested.

I barely see any similarities between the two, I would argue the the french or british democracys were closest anyone has ever come to communism on a large scale (small hippie bands had communist set ups in the sixtys I beleive).

Remember that communism is not only defined by no bussiness etc, it also must have freedom of speech, equal distribution of power and, most importantly, no racism and complete freedom of religon before it can be called communist.

 

[H0ncho]

This claim seems to be one of the main accusations against capitalism:

But the problem remains that if you leave the economy completely unregulated, the strongest (Richest) individuals will rise to the top and control everything, and everyone else will be destroyed.

It is also utterly false. Why? Because owning wealth in itself will not allow you to have any power over other persons. For example, a couple of houses down my street there lives a guy who used to be rich (about 15 million dollars net worth). Yet he had no power over me, he could not tell me to do a thing; his wealth could not in any way translate into power over me. The reason for that is that we have a state monopoly on the exercise on force in civilized nations, meaning that no one, rich or otherwise, can legally control anyone else other than through the law. If for example Bill Gates told me to wear purple I could say "no" and he would have no legal means of forcing me to do so. Of course, he *could* pay a torpedo to threaten me, but at that point he would make himself an outlaw and he would be thrown into jail and probably lose most of his wealth in the process.

Also I cannot for the life of me understand why the richest individuals would want to destroy everyone else. This might come as a surprise to you, but mr Burns is actually not based on real capitalists; he is a parody. Most capitalists have no wish for anyone else to be destroyed. And even if they had, civilized nations are ruled by laws who protects the common man from being destroyed except by the lawful judgement of his peers.

Second I want to write something about western Europe being socialist. Namely that it is not. In western Europe the means of production are predominantly owned by private enterprise, making it non-socialist. There are some very few sectors, such as telecommunications, that have been owned by the state in some countries, but since the 1980s those sectors have been privatized in many nations. In my country, Norway, telecommunications and air transport was deregulated and privatized a few years ago, with the immediate effect that prices were cut in half or fell even more.

And the third thing I wanted to say is that the definition of socialism is the public ownership over the means of production. If you don't believe me go check dictionary.com. Giving money to the poor is not socialism. Taxing the rich is not socialism. The public ownership over the means of production is.

Regading the free market it is true that there has never been a completely free market. However, all the components of a free market has at some point been tested. Private enterprise has been tested and is indeed dominant in todays world and has proven to be a huge success. Private money was tested in the 19th century and early 20th (WWI destroyed the gold standard sadly), and proved itself to be superior to todays command-economy central banking. Likewise most fetures of command economy has been tested, if not all of them at one place, and they have all proven themselves to be very bad for the economy in the long run.

 

[Saskwach]

Wouldn't that create a lot of red tape?

Maybe, maybe not; I don't know. Reading into distributism in action is my next step. The most famous distributist corporation, Mondragon, is a particularly interesting subject for many: the wiki article cites eight books on the company. Speaking as someone who hasn't read any of them, but plans to, and also knows someone who has, I hear they range the gamut from love to hate.

If someone is given shares in the company because they work there, and then they, for one reason or another, lose their shares, yet still work for the company, then what happens? They've lost their share in the company, and thus lost their entitlement to the profits of the company. In effect, they've lost income to provide for necessities, but still need to work for the company. Yet, to give back the employee their shares would devalue the value of the individual share because you're printing out shares, without any increase in value, resulting in a lower dividend overall (kinda like Germany in post-WW1, but that's another discussion).

I'm not sure how someone would "lose" their shares in a company unless you mean sell off. There are a few ways to deal with this problem.
The first is allow it. No really. What's wrong with people throwing away their own possessions? At worst it gets them right back to where they were before: working for a salary and nothing else. Hopefully their views would still be represented by those who held on to their own shares, so they actually wouldn't be back to square 1 - just square 1.5. Workers are still paid a base salary that is divorced from the shares; basing their income off shares alone would be silly. Personally, I think this solution might be counter-intuitive as if enough workers in time of need sold away their shares you'd be right back to where you started but the freedom of it has an appeal.
The second solution is to include their entitlement to X number of shares in their contract, just like sick leave and other bonuses. This would mean forcing each worker to hang on to his shares but I don't think that's any more of an imposition than requiring that all workers be allowed X days of sick leave in a year.

Also, how do you determine the value of the shares given to each worker? To give the CEO and factory worker the same share would mean there would be no incentive to rise to the top of the company, with the common worker having the same influence and sway of the top decision maker. To give one party more power than the other would mean that the party with the smaller share will have less ability to demand change and make decisions.

The incentive to reach the top would be the same as normal - a higher salary and more perks. As I said before, these shares don't represent the only income a worker receives. A closer analogy would be a bonus, not a wage. Since this is true, there's no reason to give more shares to the CEO than to the lowly worker, and thank goodness for that. Otherwise there's almost no point in distributism anyway: "shares" have replaced "wages" and everyone has the same proportion of money and power.

My final question is, What about the government? You'll have to give people shares/stocks in the government, meaning you'll have the same problem as those in the hypothetical business. Also, what happens to social services then? Will this system ultimately become laissez-fare capitalism, meaning no social services what-so-ever?

Why? I don't see why the government needs to offer monetary shares for its own workers any more than it has to privatise itself today. Government is not run to make a profit; neither is it put on the stock market. It would be ridiculous to suggest government privatise itself, so the same holds true for offering shares to workers. Of course, I'm a mere neophyte to this particular doctrine; perhaps some thinker has nutted out a solution by which government offers a stake to its workers which isn't actually privatising.

Edit: Just though of this one: If all income is dependant on the amount of shares you own in a company, then what if the company tanks? This economic philosophy means there's no such thing as 'job security', meaning you will have a lower unemployment rate.

As I've said twice in this post - though I didn't make it clear earlier, unfortunately - shares are kept distinct from salary. But still, what happens if a company tanks in our current system? Workers lose their jobs. Their job security doesn't seem a whole lot different.

 

[Anton P. Nym]

But the problem remains that if you leave the economy completely unregulated, the strongest (Richest) individuals will rise to the top and control everything, and everyone else will be destroyed.

It is also utterly false. Why? Because owning wealth in itself will not allow you to have any power over other persons. For example, a couple of houses down my street there lives a guy who used to be rich (about 15 million dollars net worth). Yet he had no power over me, he could not tell me to do a thing; his wealth could not in any way translate into power over me. The reason for that is that we have a state monopoly on the exercise on force in civilized nations, meaning that no one, rich or otherwise, can legally control anyone else other than through the law.

You fundamentally misunderstand the concept of "wealth", and what concentration of wealth can do to markets and therefor societies dependant upon markets. Armed force isn't the only form of political power (thankfully) though it's the most straightforward type; wealth itself can be used as a weapon.

Wealth isn't just the ability to accumulate material goods, it's also the ability to attract labour. Wealth hires, and also fires... which provides a significant amount of leverage on those being hired/fired. So long as the distribution of wealth is fairly wide there are countervailing forces and no individual employer can get too rambunctious (ie: labour leaves the pointy-haired tyrants for better bosses elsewhere). But if wealth concentrates into a few potential sources of employment there are fewer potential exit vectors for dissatisfied labour and thus fewer reasons for employers to "play nice". Wages go down, working conditions get worse, wealth concentrates even further into fewer hands. The end result is a collapse of a market economy because there's not enough competition... and because the concentration of wealth is high enough, there's no incentive for those with wealth to capitalise possible future competitors.

All of that, without once invoking force of arms. That happened in Rome, and the Republic eventually turned into an Empire to cope. That happened in Weimar Germany in the 1930s, and we all know what happened to them.

-- Steve