America's History Of Monopoly-Busting
Can corporations like Microsoft be too big, too powerful and too greedy?
By Brooks Jackson/CNN
WASHINGTON (AllPolitics, May 14) -- It was the "gilded age." Corporations had grown rich as huge "trusts" dominating oil, railroads, sugar, with their wealthy owners so powerful they rivaled the government itself.
They were too powerful for Sen. John Sherman (R-Ohio). "If we would not submit to an emperor," Sherman said, "we should not submit to an autocrat of trade."
Congress agreed, passing the Sherman Anti-Trust Act in 1890, with only one vote against.
Republican President Theodore Roosevelt used it against J.P. Morgan's railroad trust, breaking John D. Rockefeller's Standard Oil trust into 30 competing companies, and changing America.
For most of this century both political parties pretty much agreed: government should keep corporations from becoming too big and powerful.
In maybe the biggest anti-trust case of all, the AT&T telephone monopoly was broken up in 1982 under President Ronald Reagan.
But by then the tide had turned. Giant IBM survived an anti-trust suit, only to be brought low by newer technology and more nimble competitors.
A new breed of economists taught that big was not necessarily bad, and trust-busting waned. Mergers were allowed to flourish almost unchecked.
Today mergers are still multiplying, more than doubling since 1991 to 3,700 last year and heading to more than 6,000 this year. Included in the group are some big names: Citibank and Travelers, Lockheed and Northrup Grumond, Ameritech and SBC.
And just last week, Chrysler and Mercedes joined. "This is the largest and biggest industrial merger ever," said Daimler CEO Juergen Schrempp said,
But now the tide may be turning again, as the business tactics of software giant Microsoft are questioned by the Justice Department, state attorneys general and Congress.
Overall, there are more investigations and more lawsuits. A century after Sherman, trust-busting is coming back.