An analysis of corporate ownership across the globe recently grabbed my attention. It depicts a web of direct and indirect control in the relationships between 43,060 trans-national corporations (TNC). Published by S. Vitali, J. Glattfelder and S.Battison in September 2011, "The network of global corporate control" offers a fundamental view of the global economy.
It is a view that should be of interest to all of us because the results are stunning.
A mere 737 trans-national corporations — including many of the world's largest banks — form a cluster of relationships that, taken together, have significant influence over all 43,060 trans-national corporations in the study!
The research shows cross ownership and degrees of control between these banks and other corporations through some rather complex diagrams. If we take it for granted that it's an accurate portrayal of the relationships between these companies, then we can ask some important questions.
First, let's suppose 50 people per company have effective control of a TNC. Then 50 x 737, or about 36,850 people, hold sway, to one degree or another, over the 43,060 TNCs studied and the assets they control.
On what grounds do we think such an apparently concentrated global ownership structure is wise? Is it dangerous? Or, even worse, does the "illusion of control" among these elites fundamentally mistake how the real world evolves beyond entailing law, typically beyond our capacity to prestate what will emerge, where we need, instead, the promise of enablement?
Part of the answer is obvious. Mutual ownership can promote collusion and be anticompetitive. Ownership webs crossing national boundaries may be more likely to escape anti-trust actions, cloaked as they are within "giant strongly connected components" whose joint "network control" is vast, yet hidden in relationships that are not immediately obvious.
Should we be cautious about such a concentration of power? Intuitively, of course we should. Corporations, legal persons living forever, act in their own interests, and the giant strongly connected component suggests the possibility, if not the fact, of a web of interconnected TNCs that could potentially act in their mutual own interests, not in ours.
Moreover, the huge banks, bigger than before the 2008 crisis, are still too big to fail.
On Bill Moyer's and Company (Jan 29, 2012), John Reed, a former chairman of Citigroup who retired in 2000, said that banks too big to fail should be broken into safer fragments. Perhaps the same is true for giant TNCs in general. They represent too much concentrated power and too much corrupting influence on our government.
In addition, if we sketch out political power as it stands in the First World, we see that there also appears to be significant concentration.
This time, suppose 1,000 people in each First World country — let's say 20 such countries exist — have effective control politically, subject both to democratic restraints and the influence of lobbying efforts by giant corporations. Then we might estimate that about 57,000 people (combining the corporate influencers and the political influencers) control much of something like a billion lives, or more.
Given corporate lobbying efforts, we must be concerned that legislation and regulation is biased in favor of power. Further, power is often wielded for the sake of more power.
Given Citizens United, corporations are now able to spend vast sums of monies influencing our elections, supporting friendly candidates. This further concentrates power. Members of Congress play a role in choosing the lobbyists who will lobby Congress. This still further concentrates power.
More critically, we now have increasing grounds to believe, as I've written elsewhere, that no laws entail the unprestatable evolution of the biosphere, the econsphere, political life or cultural life. And yet more, this evolution, beyond natural selection and beyond our intent, creates its own possibilities of future "becoming."
"Control" is largely an illusion, we do not know the variables that will become relevant. Rationality is a limited guide. These profound facts argue a need to devolve our excessively concentrated power, economic and political, to a far more diffusely and democratically distributed empowerment in order to more wisely enable the radical emergence that is how the living world actually works, and wisely revise our well devolved choices as we see the consequences unfold.
The current concentration of power is dangerous and often self-serving. Worse, it fails to enable the distributed wisdom and creativity of which we are jointly capable.