The Rise of the Supercorporation

The tech bubble would be proud if it were still alive.

Everything we promised has come true, and more. The dreams we had. That one day you'd be able to buy your groceries from home (Fresh Direct), clear your shelves of the Britannicas (Wikipedia), and make a "video phone call" with your friends across the globe. That transparency and a hyper-competitive landscape would pave the road for an empowered and knowledgeable consumer and usher in a new wave of American entrepreneurialism.

Yet the same medium which has given rise to re-birthed capitalism in a few industries has created oligopolies (sectors dominated by only a few key players) in many others. For these supercorporations, the Internet has offered a degree of connected that facilitates coordination and round-the-clock production that heretofore was impossible. While the eighties and the nineties began domestic waves of consolidation, the noughties ushered in international mergers and acquisitions blessed by tremendous technological progress.

The result is that many corporations have productive capacity which challenges even medium-sized nation states. For example, in 2008, Exxon Mobil's gross revenues were $477 billion while Walmart had gross revenues of $379 billion (they were the two largest corporations internationally by revenue). Taken together, there were the 17th largest GDP in the world, ahead of Poland, Belgium, Switzerland and Thailand.

The point of this is not to necessarily disparage the rise of the supercorporation, but rather to highlight that companies of this size portend structural shifts of power away from the hands of the government and into corporations.

I hope to, over the next week, discuss the implications that this has on labor, governance and centralized planning. Happy reading.