Despite persistent caricature, corporate titans do not always view government regulators as enemies; they often see them as unwitting collaborators. Big business and the regulatory state go hand-in-hand, according to Michael Gove, a Conservative Party Member of the UK’s Parliament. Large corporations sometimes support – and occasionally help write – regulations that they can keep, but that their competitors cannot. By setting the regulatory bar just out of reach, they use the lever of government to artificially restrict competition in their favor.
The higher the level of government in which power is concentrated, the more absolute the influence of the largest corporations. Only the wealthiest, or politically connected, multinational firms have the wherewithal to influence a supranational government, such as the European Union.
“Those large firms have the capacity to lobby at a transnational level, away from accountable national electorates and proper scrutiny, in order to assure that their position becomes entrenched,” MP Gove told a conference on the question “Why is the West Stagnating?” hosted by the Institute of Economic Affairs (IEA) on January 26 in London. “They can insist on rules that act as barriers for new firms and … they can also, at the same time, virtue signal by saying that these new rules … are regulations inspired by their love for the environment, or their commitment to families.”
“How delicious,” he concluded. You can watch more of his speech below.
(Photo credit: MPD01605. CC SA-BY 2.0.)