Megacorporations have come to dominate nearly every aspect of our economy and daily lives. Walmart captures more than half of grocery spending in 43 metro areas, giving it extraordinary power over the entire food production system. Four massive banks — Bank of America, Citigroup, JP Morgan Chase, and Wells Fargo — control more than 40 percent of our financial assets, $11 trillion in total. A handful of pharmaceutical companies and hospital chains reign over health care. Monopoly railroads and ocean shipping consortiums have a stranglehold on our supply chains. Most concerning of all are the tech giants. Amazon, Apple, Google, and Facebook not only dominate numerous markets; they control the very infrastructure that underpins virtually all of our commerce and communications.
These corporate behemoths pose a daunting challenge for organizers. Their scale makes them all but impossible to unionize. Their monopolization of markets allows them to absorb negative publicity with little or no loss in revenue. Their resources give them immense sway over government.
To overcome these formidable forces, we need to organize a broad popular front capable of generating enough political will in Washington for policymakers to act. Only by using the tools and authority of the federal government can we directly target and dismantle the outsized power of these corporations. To get there, organizers will need to align a diverse range of people who’ve been harmed by corporate concentration. One especially promising set of allies in this project are small business owners and groups.
The Real Culprit Behind the Decline of Small Business
Over the last few decades, small businesses have plummeted in numbers and market share, losing ground about as rapidly as organized labor. In the 1980s, businesses with fewer than 100 employees accounted for about 40 percent of the private-sector economy. Today, their share is down to about 20 percent. This decline has accelerated in recent years. Between 2007 and 2017, the number of small retailers fell by 65,000, according to Census data, while more than one third of the nation’s small manufacturers of apparel, toys, sporting goods, and books disappeared.
This downward turn for small businesses can be traced to the same neoliberal thinking that subverted unions. Beginning in the 1970s, both political parties embraced the idea that giving big business free rein would produce faster economic growth and lower prices. In the 1980s and 1990s, Republicans and Democrats joined forces to gut antitrust enforcement and overturn New Deal-era laws that had prevented consolidation in banking, media, agriculture, and retail.
Newly empowered by these policy changes, corporations flexed their muscle to crush both the labor movement and their smaller competitors. Over time, they leveraged their growing political influence to rewrite tax policies, trade rules, and other regulations to further undermine their rivals and tip the playing field even more to their own advantage.
For a long time, the US Chamber of Commerce — which derives most of its massive lobbying budget from megacorporations — dominated public narratives about the decline of small business, which it blamed on labor and environmental regulations.
But small business owners often tell a very different story. Ask them what’s making it hard to succeed — as my organization, the Institute for Local Self-Reliance, has in numerous interviews and surveys — and, chances are, you’ll hear about predatory corporate power in one form or another.
For many entrepreneurs today, it doesn’t matter how hard they work or how popular their services are. They operate in markets cornered and rigged by megacorporations. Take Ben Okafor, a pharmacist and immigrant from Nigeria. Eight years ago, Okafor opened Family Pharmacy in a remote Maine town just shy of the Canadian border. The pharmacy is a huge hit with the community. But like independent pharmacies across the country, Family Pharmacy is at the mercy of CVS Health, a massive conglomerate that not only operates a competing retail pharmacy chain but also controls, through its insurance wing, how much local pharmacists like Okafor are reimbursed for filling prescriptions. They are “really squeezing us,” says Okafor.
Similar dynamics are at work in many industries, enabling dominant corporations to sidestep real competition by using brute market power to exploit and vanquish their rivals. Amazon, for example, has relied on a wide range of monopolistic tactics — including predatory pricing, anti-competitive acquisitions, and dubious tax-dodging maneuvers — to gain control of over two-thirds of online shopping searches and traffic. This has left independent retailers and product-makers with little choice but to sell on Amazon’s platform, allowing the tech giant to saddle them with exorbitant fees and copy their best-selling products.
Walmart has exploited its extraordinary power as the top buyer of groceries to compel food companies to raise prices or even deny shipments to competing independent grocery stores. Banking consolidation has dramatically reduced lending to small businesses, especially entrepreneurs of color, leaving them starved of capital or drowning under the weight of high-cost online loans. Visa and Mastercard impose swipe fees on U.S. merchants that are seven times what they charge in Europe, where these fees are regulated.
This assault on small business has not gotten enough attention in the progressive analysis of what’s gone wrong in our political economy, but it should. It’s been hugely consequential to the well-being of ordinary Americans. For generations, starting a business offered a way to secure a middle-class living and a measure of self-determination. Small businesses generate broad economic benefits as well: they play a pivotal role in innovation, and their presence lifts wages by creating more competition for labor. Local businesses also foster stronger social networks and more cohesive neighborhoods. They have particular significance in Black, brown, and immigrant communities. One consequence of the rise of monopolistic megacorporations is that there are fewer Black-owned businesses today than there were in the 1970s.
A United Front Against Corporate Power
For decades, we’ve been conditioned to see labor unions and small business as inherently oppositional. But, in fact, both are a means to the same end: decentralizing economic power and shifting more of it into the hands of ordinary people.
Indeed, this was the framework that guided the New Deal, which, as Franklin Roosevelt put it, was about securing “economic freedom for the wage earner and the farmer and the small-business man.” During the Great Depression and the decades that followed, unions and small businesses both gained ground as progressive lawmakers pursued a multi-pronged attack on corporate power. In retail, agriculture, and other sectors, they broke up big companies and passed laws that ensured fair markets for farmers and small businesses. In other industries, such as steel and auto, they forced corporations to the bargaining table.
This approach to governing the economy was incredibly popular. Backed by an alliance of unions, farmers, and small businesses, Democrats reliably delivered majorities in both the House and Senate from the 1930s to the 1970s. The middle class swelled. And, in spite of the racism baked into some New Deal policies, the gap between Black and white income narrowed during these years, before stalling out and even widening in the decades since.
Today, anti-monopoly thinking has returned to the fore of progressive politics, prompting a renewed attention to small businesses. When Senator Elizabeth Warren kicked off her presidential campaign in 2019, she said her goal was “to put more economic power in the hands of the American people — workers and small businesses.” Congresswoman Pramila Jayapal, the chair of the Progressive Caucus, and Congressman David Cicilline, chair of the House’s subcommittee on antitrust, have made small businesses a central focus of their effort to break up and rein in Big Tech. Last year, President Biden issued a lengthy executive order directing federal agencies to use a wide range of authorities to combat corporate concentration. The order, which was developed by progressive economic and legal advisors on Biden’s team, defined its beneficiaries as “workers, farmers, [and] small businesses.”
How can organizers and campaign strategists seize this moment to build a united front against corporate power that aligns small businesses with workers and community members?
First, organizers need to invest in deep, strategic organizing among small businesses. This means seeing small businesses as part of the progressive base and investing in long-term base-building and leadership development, driven by the issues of most concern to small business owners. This is resource-intensive work, involving countless one-on-one conversations and group meetings that build trust, solidarity, and a shared agenda. But several organizations — including Main Street Alliance, the American Independent Business Alliance, and Small Business Majority — are showing the way, demonstrating what can be achieved.
In addition to the bottom-up organizing work, organizers can look to established small business groups as potential allies in the fight to check runaway corporate power. Last year, my organization, the Institute for Local Self-Reliance, helped found Small Business Rising, a coalition of about 30 local and national small business groups, including several trade associations that exclusively represent independent businesses in their sectors. The coalition is working to persuade policymakers to break up monopolies and enact strong antitrust policies. It often coordinates with economic and racial justice groups.
One key to building an active small business base is political education. Neoliberalism has trained small business owners, and Americans in general, to believe that the market conditions they encounter are created by neutral forces rather than deliberate policy decisions. Entrepreneurially-minded people especially have a tendency to approach monopolistic behavior by megacorporations as an obstacle that’s up to them to overcome rather than a problem that policymakers can and should eradicate. Organizers can help pull back the curtain by highlighting how particular policy decisions — gutting antitrust enforcement, opening up corporate tax loopholes, and more — have rigged the game and all but ensured that only the biggest succeed.
Progressive policymakers and advocates also need to incorporate small businesses into their messaging and policy agenda. Right now, small businesses lack a political home. Both parties evoke them rhetorically, as a kind of Americana imagery, but neither exhibits a serious interest in whether they have a future. That’s why the House Judiciary Committee’s 16-month investigation of Big Tech caused such a stir among small business owners. It was the first time that many had seen their experiences of market power abuse called out like that, including in the committee’s grilling of Amazon founder Jeff Bezos.
By championing a policy agenda that addresses small business’s biggest problems, organizers can energize and mobilize small business owners. Doing so will yield other benefits too. By telling the true story of what’s driving the decline of small businesses, progressives can erode some of the US Chamber of Commerce’s influence by making it harder for the Chamber to get away with pushing a big business agenda under the guise of helping small business.
Fighting for pro-small business policies will also enable organizers to navigate genuine points of tension between workers and small businesses. While most small business owners support raising the federal minimum wage, for example, higher minimums set at the municipal level can be a legitimate challenge in high-cost cities where local businesses are struggling with soaring rents and competition from suburban chains that aren’t subject to the same labor costs. A smart solution is to pair wage increases with measures that give small businesses greater negotiating leverage with landlords or limit excessive rent increases.
But perhaps the biggest benefit of making small business a more visible character in the progressive narrative is that small business has a special potency in American political discourse. It evokes our aspirations for liberty, our desire to direct our own affairs, subject to no king. This is a powerful idea. We should conjure it often in the fight to overthrow megacorporations, which, after all, are every bit as tyrannical as kings.
Finally, organizers need to develop campaigns that nurture an alliance between small businesses, working people, and communities harmed by corporate concentration. This is already underway in the campaign to check Amazon’s outsized power. The Athena coalition has been leading the way, with its member groups challenging Amazon on multiple fronts, including its treatment of workers, deployment of surveillance devices that harm people of color, and domineering expansion into communities. (ILSR co-founded and is a member of Athena.)
Across all of these issues, there’s a shared conviction among Athena’s members that Amazon has too much power and that dealing with that directly is essential. To that end, the coalition has collaborated with Small Business Rising, labor unions, and others to advance legislation in Congress that would break up and regulate Amazon and the other Big Tech companies. Athena has also joined with ALIGN, Small Business Rising, and others to campaign for an antitrust bill in New York that would give the state’s attorney general more authority to go after dominant corporations that exploit their market position to abuse workers, suppliers, or competing small businesses. And the coalition is pushing the Federal Trade Commission to use its rule-making authority to rein in Amazon.
Across this work, Athena has engaged small business groups as strategic allies and sought to lift up small business voices. Last fall, for example, the coalition hosted a briefing for Congressional staff that featured speakers from the American Independent Business Alliance and the Strategic Organizing Center, who talked about why working people and small businesses urgently need Congress to act on Big Tech. Similarly, many of Athena’s advocacy letters to lawmakers include small business groups as signers, and the coalition frequently includes small business leaders in its meetings on the Hill and with state policymakers.
Organizers should look to pick other strategic fights that would further this alliance. There are many options. Virtually every extractive, Wall Street-driven megacorporation has amassed power and wealth by both exploiting workers and crushing small competitors. Organizers might, for example, target the giant meatpacking companies, which have squeezed ranchers, forcing many into bankruptcy, and imposed ruthless conditions on the people working in their slaughterhouses. At the local level, organizers might campaign for city measures to regulate the big delivery apps, like DoorDash and GrubHub, which have grown to dominance by cheating independent restaurants and drivers alike.
Many existing progressive campaigns might pick up new support if they included a small business angle in their framing. The tens of billions of dollars that cities and states hand out each year in corporate subsidies, for example, not only deprive the public sector of needed revenue but also create an unlevel playing field for small businesses. One reason that organizers succeeded in stopping New York from giving Amazon $3 billion in tax incentives for a new headquarters was that they positioned the deal as an abuse of monopoly power and persuaded elected officials to adopt the same framing.
We should also think creatively about campaigns that could proactively advance a vision for a more equitable and prosperous economy. One opportunity lies with the US Postal Service, which is rapidly losing ground to Amazon’s package delivery operation, with major downsides for small businesses, workers, and communities. Congress could direct and fund the Postal Service to build out an e-commerce warehousing and fulfillment service for small and mid-sized businesses. This service would free small businesses from having to rely on Amazon’s platform, offering them a leg up in competing with the tech giant, while also creating well-paying, union jobs. These new facilities could be sited in low-income rural and urban neighborhoods.
After more than 40 years in which public policy has actively encouraged concentration, giving rise to megacorporations whose power threatens to eclipse that of government itself, today’s growing anti-monopoly movement offers a promising path for uniting small businesses with workers and building the political will for change.
