Friday, August 28, 2015

The coming oligopoly

The National Labor Relations Board just decided to hold franchisors accountable for employee procedures in each of its franchisees' locations. This is big. The idea that a franchisee in Florida may now be impacted by another in California, even if indirectly, is so far outside the bounds of a free and accountable society that it borders on comedy.

Decisions like this lead to the inevitable corporitization of America where big business is the only business allowed to operate. Consider how few choices you have when you examine how many brands are now owned by fewer and fewer companies. As horizontal mergers continue under the argument for "economies of scale", America will be hemmed into an oligopolistic society rather nicely, where big business pays for favors and politicians deliver. Well done America.

"Business groups countered that the decision was meant as a favor to labor groups, who have targeted retailers such as Walmart and franchise restaurants such as McDonald’s for unionization. Unions have run into obstacles because under the franchise model they have to organize on a store-by-store basis. The new standard could make it easier for unions to get a seat at the table by unionizing at the corporate parent level, according to David French, a vice president at the National Retail Federation."