The caricature of the robber baron has been around for over a century. It depicts the American business executive or industrialist as a crook, a thief, a malicious and brutish persona who possesses inordinate and far-reaching power and influence that he nefariously uses against others. The source of the “robber barons'” wealth and perceived power is never identified, nor is it necessary to understand what this fictional representation conveys.
We would never presume that the source of the “robber barons'” wealth would be their innovation, creativity, or the value they produce. It is assumed that whatever power he has must be inherent and unfairly gained. To the extent we acknowledge the process by which he acquired his wealth, we also take for granted that it must have been through the exploitation of others.
The robber baron’s victim is depicted as the “everyman”: the “working class,” the “poor,” the downtrodden. We are led to believe that the government enables him, but only insofar as he controls the levers of power through corrupt means. The “robber baron” is depicted in cartoon illustrations as being large and overweight—to suggest his desire for far more than he needs—or as an animal or other creature with claws, tentacles, or spider’s legs, a metaphor for his innate assets and how he uses them.
The answer provided by the political demagogues who present the public with such an image is government intervention. Presumably, if the businessman were such an evil force in society, we would do all we could to prevent it. However, rather than eliminate the “robber baron,” the government proposes instead that we control him through regulations, statutes, and other political means to extract whatever value he offers while limiting his reach and influence, which we deem inherently immoral for him to exercise. So long as the government stands between the “people” and the “robber barons,” the public’s interests are protected.
Such a farce has been perpetrated on the public for over a century and continues to be, despite its total detachment from reality. The “robber baron” does not exist in reality as portrayed in cartoons and print or the stereotypes in political speeches. However, the “solution” to the robber baron has been implemented into reality in the form of all manner of regulations against private enterprise, in ways that the public has voted on and others in which the public has not.
The most pernicious examples are antitrust law, which sprung forth the Sherman Act of 1890, the Clayton Act of 1914, and the Federal Trade Commission Act of 1914, and employment law, which gave rise to, among others, the National Labor Relations Act of 1935, the Fair Labor Standards Act of 1938, the Occupational Safety and Health Act of 1970, the Employee Retirement Income Security Act of 1974, and the Family and Medical Leave Act of 1993.
All of these laws presume the employer or the corporation to be villains, the same ones we depend on for the jobs they produce and the products they create. We do not consider whether these entirely fictionalized “villains” could survive in a free market if they possessed all of the negative traits we attribute to them. For example, a company attempting to corner the market with high prices would be undercut by competitors; the wicked employer who unfairly punishes his employees would struggle to find anyone to work for him.
Nor is it questioned whether the provider of the solution may be the source of the problem. Yet the truth is that the government creates the “robber baron” and presents itself as the force necessary to restrain him. Government subsidies and other preferential treatment of particular corporations—to the exclusion of others—permit those economic actors receiving government largesse to engage in uncompetitive practices, both in the market for their products and in employment, through their ability to prevent other employers from emerging to unseat them.
Antitrust laws punish corporations for becoming too “large” and are applied when a corporate recipient of government largesse starts getting too plump. Employment laws suggest that the employer is the enemy and the government is the advocate of the people. Yet, government policies enable the worst employment practices by creating a barrier to entry that discourages small businesses from being able to offer a viable alternative.
Why do I link these two areas of law together? Because they are both joined by a common and false philosophy. Moreover, they represent the same destructive implementations against the free market and the individual right to contract and trade. It is a philosophy based on collectivism and altruism—that the profit motive is an evil one, and that the role of the government is to play “Robin Hood” by redistributing the wealth and products generated by a small few to various “groups” within society. Such concepts are anathema to individual rights, on which America was founded.
Antitrust laws are perhaps the most immoral laws today. They are based upon an almost laughably ironic principle: that the government’s role is to prevent private businesses from monopolizing the market. Private businesses cannot monopolize a free market; if they attempt, they only create an opening for competition to undercut them.
Monopolies require government coercion and “prestige” to exist. The government creates monopolies and then casts itself as the white knight to defend the public from them. Think “too big to fail.” This is the reality of our economy today, and the perverse results are so widespread that it is almost an accepted facet of daily life.
Employment laws passed by state and federal legislatures follow the same principle of the embrace of government intrusion into the free market that has harmed the American worker by reducing competition. The barrier to entry to create a business is high due to the regulation of private employment contracts. The built-in cost of hiring a single employee and the potential for legal exposure are so astronomical that many small businesses forgo hiring employees and operate as sole proprietorships.
This is not only anti-free market but anti-American (and I don’t mean in a nationalist sense, but in terms of the founding principles). It destroys innovation by entrenching economic players whose industry dominance is ensured by the government, rather than their offerings on the market. The harmful effects of destroying competition are distributed across all industries and markets, not in an abstract but in a real and tangible sense.
Here’s another example: When I represented large employers in private law firms, the biggest clients were the ones who were publicly funded—hospitals, municipalities, schools, or large corporations that were significant beneficiaries of government subsidies (that smaller businesses have a snowball’s chance of getting).
And guess what? These clients didn’t question the bills or the work product. How many large firm associates know their billing rate offhand? Very few. Does such a dynamic make the legal services industry more or less competitive? Does it improve the quality of options on the legal market?
I am motivated to represent small-to-mid-sized businesses in employment law, partly because they are the greatest victims of this dynamic. For anyone who has ever contemplated joining the fray by opening their own small business, or is employed by one, your interests are in direct collision with these laws. If you benefit from the fruits of innovation produced in a free market, you also have a stake in this fight.