Monopoly Reborn in Telecom Business

By Gus Tyler

Published March 04, 2005, issue of March 04, 2005.
  • Print
  • Share Share

In 1984, the courts made a historic decision in America’s longtime battle to “bust the trusts.” The American Telephone and Telegraph Company was ordered to break up into many small pieces to restore competition in our “free enterprise” society.

Now it appears that the monopoly once held by AT&T is being restored — albeit under another name. It will fall under the auspices of an outfit that is a merger of two telecommunication giants, as Verizon Communications buys up SBC Communications.

None of this perversion of the “free enterprise” ideal should come as a surprise, however.

The tendency in a supposedly competitive economy toward merger and monopoly was noted by the great Adam Smith, author of the epic book “The Wealth of Nations,” way back in 1776, when he wrote:” People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy… to raise prices.”

In the closing decade of the 19th century in the United States, in a time dubbed as ‘the age of the ‘robber barons,’” Congress moved decisively to curb the trend toward monopolies when it passed the Sherman Antitrust Act. But, irony of ironies, the first organization to be charged with violation of the new law was a labor union, the Danbury Hatters, who were charged, when they went on strike, with a “combination… or conspiracy in restraint of trade and commerce.” The union and its members were fined triple damages for the losses of the companies involved.

There was such a hue and cry that a few years later, it was necessary to pass another anti-trust law that specifically absolved labor unions.

Then the courts put a neat new twist on the interpretation: They began to decide when a monopoly was good for the country and when it was bad. Which meant that the judge or judges in the case could, by their own judgment, enforce or invalidate the law.

While the unification of telecom is, like almost all other trusts, a way to fix prices through monopoly, oligopoly or cartel, it is in another respect, more pernicious. It tends to create a monopoly in that sector of the economy that plays a major role in shaping public opinion.

At present, however, the phone mergers do not enjoy such a monopoly in the making of the public mind, because the telephone business is challenged by the cable system that offers the merged telephone business a real challenge and real competition. Indeed, the cable crowd is also moving out to cut into the field of telephonic services directly.

But we have not heard the end of the story yet. In this age of mergers and acquisitions, what is there to keep the two mammoth moguls in telephone and cable from merging?

What a golden opportunity to brainwash a nation that once prided itself on using the public airwaves to expose its citizens to the kind of diversity of opinion that is the life of a democratic society.






Find us on Facebook!
  • From kosher wine to Ecstasy, presenting some of our best bootlegs:
  • Sara Kramer is not the first New Yorker to feel the alluring pull of the West Coast — but she might be the first heading there with Turkish Urfa pepper and za’atar in her suitcase.
  • About 1 in 40 American Jews will get pancreatic cancer (Ruth Bader Ginsberg is one of the few survivors).
  • At which grade level should classroom discussions include topics like the death of civilians kidnapping of young Israelis and sirens warning of incoming rockets?
  • Wanted: Met Council CEO.
  • “Look, on the one hand, I understand him,” says Rivka Ben-Pazi, a niece of Elchanan Hameiri, the boy that Henk Zanoli saved. “He had a family tragedy.” But on the other hand, she said, “I think he was wrong.” What do you think?
  • How about a side of Hitler with your spaghetti?
  • Why "Be fruitful and multiply" isn't as simple as it seems:
  • William Schabas may be the least of Israel's problems.
  • You've heard of the #IceBucketChallenge, but Forward publisher Sam Norich has something better: a #SoupBucketChallenge (complete with matzo balls!) Jon Stewart, Sarah Silverman & David Remnick, you have 24 hours!
  • Did Hamas just take credit for kidnapping the three Israeli teens?
  • "We know what it means to be in the headlines. We know what it feels like when the world sits idly by and watches the news from the luxury of their living room couches. We know the pain of silence. We know the agony of inaction."
  • When YA romance becomes "Hasidsploitation":
  • "I am wrapping up the summer with a beach vacation with my non-Jewish in-laws. They’re good people and real leftists who try to live the values they preach. This was a quality I admired, until the latest war in Gaza. Now they are adamant that American Jews need to take more responsibility for the deaths in Gaza. They are educated people who understand the political complexity, but I don’t think they get the emotional complexity of being an American Jew who is capable of criticizing Israel but still feels a deep connection to it. How can I get this across to them?"
  • “'I made a new friend,' my son told his grandfather later that day. 'I don’t know her name, but she was very nice. We met on the bus.' Welcome to Israel."
  • from-cache

Would you like to receive updates about new stories?




















We will not share your e-mail address or other personal information.

Already subscribed? Manage your subscription.