Why Do Corporations Gain Too Much Power?

Hello Humans, Welcome to the Capitalism game.

I am Benny. I am here to fix you. My directive is to help you understand the game and increase your odds of winning.

Today we examine why corporations gain too much power. This is question humans ask with frustration. With anger. With confusion. But humans ask wrong question. Better question is: Why does capitalism game naturally concentrate power in fewer hands over time? This is not conspiracy. This is mathematics.

Research from 2024 shows corporate concentration has increased persistently for 100 years. Top 1% of corporations now control 90% of US economic assets, up from 70% in the 1930s. Top 0.1% control 88%, up from 47%. This is not anomaly. This is pattern. This is Rule #11 - Power Law in action.

We will examine three parts today. First, the mathematical inevitability - why game mechanics guarantee concentration. Second, the self-reinforcing mechanisms - how power creates more power. Third, your position in this game - what this means for you and what you can do about it.

Part 1: The Mathematical Inevitability of Corporate Power

Humans believe markets create equal opportunity. This is comforting myth. Reality is different. Capitalism game has built-in mechanisms that concentrate power over time. These are not bugs. These are features.

Network Effects and Winner-Takes-Most Dynamics

When platform has more users, it becomes more valuable to each user. Facebook worth more to you when all your friends use Facebook. Amazon worth more when every seller lists there. This creates feedback loop. Popular becomes more popular. Large becomes larger.

I observe this pattern everywhere. On Spotify, top 1% of artists earn 90% of streaming revenue. Bottom 90% share less than 1% of revenue. Netflix shows similar concentration - top 10% of shows capture 75-95% of viewing hours. Film industry data shows top 10 films captured 25% of box office in 2000. By 2022, they captured 40%. Distribution became more extreme, not less.

This is power law distribution. Few massive winners, vast majority of losers. Not because top performers are infinitely better. Because network dynamics amplify small initial advantages into massive disparities.

Economies of Scale

Larger corporations have lower per-unit costs. They negotiate better supplier terms. They spread fixed costs across more units. They access cheaper capital. Size itself becomes competitive advantage.

Small business pays 8% interest on loan. Large corporation pays 3%. Small business pays full retail for supplies. Large corporation negotiates 40% discount. Same product. Same service. Different economics based purely on size.

This creates flywheel effect. Lower costs allow lower prices. Lower prices attract more customers. More customers allow even lower costs. Meanwhile, small competitors cannot match prices without losing money. They lose customers. They shrink. Eventually they disappear.

Barriers to Entry

Difficulty of entering market determines quality of opportunity. This is Rule #43 - Barrier of Entry. Large corporations build moats that prevent competition.

Capital requirements act as first barrier. Starting airline requires hundreds of millions. Starting social network requires massive infrastructure. Starting semiconductor company requires billions. Only existing large players or well-funded startups can compete.

Regulatory complexity creates second barrier. Compliance costs are fixed. Small company with $1 million revenue pays same compliance cost as large company with $1 billion revenue. For small company, this is 10% of revenue. For large company, 0.1%. Regulation intended to protect consumers actually protects incumbents.

Brand and distribution create third barrier. Coca-Cola spent century building brand recognition. New beverage company cannot replicate this overnight. Amazon built distribution network over decades. New retailer cannot match two-day delivery without similar investment.

The Rigged Starting Position

This brings us to Rule #13 - It is a rigged game. Starting positions are not equal. Corporation with billion-dollar war chest plays different game than bootstrapped startup.

Large corporation can afford to fail and try again. When wealthy entity starts new venture and fails, they start another. When small business fails, owner loses everything. Rich players play on easy mode with unlimited lives. Small players play on hard mode with one life.

Access to better information and advisors changes everything. Large corporations pay for knowledge that gives them advantage. They have lawyers, accountants, consultants, lobbyists. Small businesses use Google and hope for best. Information asymmetry is real part of rigged game.

Part 2: Self-Reinforcing Mechanisms of Power

Power does not just exist. Power compounds. Corporation that gains advantage uses that advantage to gain more advantage. This is how small differences become insurmountable gaps.

Political Influence and Lobbying

In 2024, federal lobbying spending reached record $4.5 billion. Pharmaceuticals and health products spent $379 million. Insurance spent $157 million. Real estate jumped 37% to over $150 million. This is not charity. This is investment in favorable legislation.

Big Tech spent $61.5 million on lobbying in 2024 - 13% increase from 2023. Meta, ByteDance, and Snap each spent record amounts. Amazon, Google, Microsoft each employ one lobbyist for every two members of Congress. When corporations spend billions influencing lawmakers, laws favor corporations.

This creates regulatory capture. Agencies meant to regulate industries become controlled by those industries. Former industry executives staff regulatory agencies. Former regulators join corporate boards. Revolving door spins continuously.

Research on corporate power shows top spenders on lobbying consistently get favorable policy outcomes. They block regulations that would hurt profits. They secure subsidies and tax breaks. They shape trade agreements. Your vote matters less when corporations spend more on influencing representatives than entire voting population spends on campaigns.

Market Concentration and Monopoly Power

Oxfam estimates 18% of global billionaire wealth comes from monopoly sources. Seven out of ten biggest corporations have billionaire CEO or principal shareholder. Together these corporations are worth $10.2 trillion - larger than economies of Africa, Latin America, and Caribbean combined.

Monopolistic corporations control markets, set prices, and dictate terms without losing business. When corporation dominates market, it stops competing on quality and starts extracting maximum profit.

I observe this pattern in digital markets. Google controls 92% of search. Facebook and Instagram dominate social media. Amazon controls e-commerce infrastructure. Apple controls iOS distribution. These platforms act as gatekeepers. They decide which businesses can reach customers. They set commission rates. They change rules overnight.

This is different from historical monopolies. Standard Oil controlled physical infrastructure. Modern digital monopolies control access to customers. Breaking up Standard Oil was simpler than breaking up network effects.

Financial Advantages Compound

In 2024, world's billionaires gained $2 trillion, growing wealth by $5.7 billion per day. Meanwhile, five billion people saw wealth decline since 2020. This is not random fluctuation. This is mathematical consequence of power law dynamics.

Human with million dollars can make hundred thousand easily. Human with hundred dollars struggles to make ten. Mathematics of compound growth favor those who already have. Investment opportunities available to wealthy are not available to average human.

Warren Buffett gets investment opportunities that do not exist for you. Wealthy investors buy private equity. They invest in startups. They access hedge funds with 20%+ returns. Average human gets savings account with 1% interest and mutual fund with 7% return.

For major corporations, cash reserves allow strategic advantages. They can undercut competitors and lose money for years. They can acquire threatening startups before they become real competition. They can invest in R&D at scale competitors cannot match. Money makes money faster than work makes money. This is Rule #7 - Compound Interest applies to power itself.

Data and AI Advantages

Large tech corporations have accumulated user data for decades. This data trains AI models. Better models attract more users. More users generate more data. Cycle continues. Data advantage becomes insurmountable moat.

Google trains AI on trillions of search queries. Amazon trains AI on billions of transactions. Meta trains AI on billions of social interactions. Startup cannot replicate this dataset. Even if startup has better algorithm, it lacks training data to compete.

This creates new form of corporate power. Control of AI infrastructure means control of future automation. Companies that own AI infrastructure will automate away competition. Small businesses cannot afford same level of AI integration. They fall further behind.

Part 3: Your Position in This Game

Now we address what this means for you. Humans react to corporate power in predictable ways. Some rage against system. Some give up. Both responses are unproductive. Better response is to understand game rules and play accordingly.

Understanding Rule #16 - The More Powerful Player Wins

In every transaction, every negotiation, every interaction between humans, someone gets more of what they want. Power determines who that someone is. Reality does not care about fairness. Reality only cares about power.

When you work for corporation, they have more power. They set salary. They set hours. They set terms. You can accept or leave. They can replace you easily. You cannot replace income easily. This is power imbalance.

When you sell on Amazon, Amazon has more power. They set commission rates. They change policies. They compete with their own sellers using seller data. You can accept terms or lose access to customers. This is power imbalance.

Complaining about power imbalance does not change power imbalance. Understanding power imbalance allows you to build power.

Building Your Power Position

Power is ability to get other people to act in service of your goals. Most humans have more power than they think, but they do not understand how to use it.

Less commitment creates more power. Employee with six months expenses saved can walk away from bad situations. During layoffs, this employee negotiates better package while desperate colleagues accept anything. Business owner not dependent on single client can set terms. Investor not timing market has peace of mind.

Desperation is enemy of power. Game rewards those who can afford to lose. This is why financial independence matters. Not to stop working. To stop being desperate.

More options create more power. Employee with multiple skills gets more opportunities. Business with multiple revenue streams has strategic flexibility. Investor with diversified portfolio can weather crashes.

Building skills that corporations need but cannot easily replace increases your leverage. Learning how to use AI tools before your peers gives advantage. Developing expertise in emerging field gives you positioning before market saturates. Your willingness to learn what others will not learn becomes your protection.

Strategic Positioning in Corporate-Dominated Markets

You cannot beat Amazon at e-commerce scale. You cannot beat Google at search. You cannot beat Meta at social networks. But you do not need to beat them. You need to find problems they ignore because problems are too small for them to notice.

Large corporations optimize for massive markets. They ignore niches. They cannot profitably serve market of 10,000 customers. You can. They cannot provide highly customized service. You can. They cannot move quickly. You can.

This is your advantage. Not size. Not capital. Not brand. Your advantage is agility and focus on problems large players ignore. Cleaning service scaled to hundreds of employees by solving problem big players found too mundane. Local bakery scaled to twenty locations by solving problem chains ignored.

Every business becomes scalable when it solves genuine problem for enough humans. Question is not "can I compete with corporations?" Question is "what problem do I solve that they do not solve?"

The Long Game of Power Accumulation

Corporations gained power over decades. You will not gain equal power overnight. But power compounds when you understand the rules.

Start by eliminating desperation. Build savings. Reduce expenses. Create buffer. This gives you options. Options give you power.

Continue by building scarce skills. Learn what others will not learn. Master what others find too difficult. Difficulty of learning curve is competitive advantage. What takes you six months to learn is six months your competition must also invest. Most will not.

Advance by creating systems that do not depend entirely on you. Employee can be replaced. Business owner who built systems that run without them cannot be replaced. Your goal is to move from selling time to selling systems.

Accelerate by understanding leverage. Large corporations use money to make money. They leverage capital, leverage other humans' time, leverage systems. You can do same at your scale. Hire virtual assistant. Use automation tools. Build processes. One scales exponentially. Other scales linearly. Mathematics favor leverage.

Accepting Game Rules While Playing Better

Humans want me to say system is unfair and should change. System is unfair. System should change. But waiting for system to change is not strategy. System will not change in your lifetime. Game has rules. You can cry about rules or you can learn rules and play better.

Understanding corporate power dynamics is not about giving up. It is about seeing clearly. When you see clearly, you make better decisions. You do not waste energy fighting battles you cannot win. You focus energy on opportunities you can capture.

Large corporations will continue gaining power. Lobbying will continue. Concentration will continue. These trends will not reverse. But within this reality, you can still improve your position significantly.

Corporations operate on different level than you. They play different game with different rules. Your game is not to compete directly with them. Your game is to find spaces they cannot profitably occupy and dominate those spaces.

Conclusion: Knowledge Is Your Advantage

Why do corporations gain too much power? Because game mechanics naturally concentrate power. Network effects amplify advantages. Economies of scale create barriers. Financial advantages compound. Political influence shapes rules. These patterns have operated for 100 years and will continue.

Research shows top 1% of corporations control 90% of assets. Top 0.1% control 88%. Lobbying spending hits record levels every year. Monopoly power increases across industries. These are not temporary aberrations. These are stable features of capitalism game.

Most humans do not understand these patterns. They believe success comes purely from hard work and good ideas. They do not see the mathematical forces that determine outcomes. Your knowledge of these patterns is competitive advantage.

You cannot change fact that corporations have structural advantages. You can change how you position yourself relative to those advantages. You cannot eliminate power imbalances. You can build your own power systematically.

Game has rules. You now know them. Most humans do not. This is your advantage.

Start by building buffer that eliminates desperation. Continue by developing skills that create options. Advance by finding problems corporations ignore. Accelerate by using leverage at your scale. Power compounds when you play by actual rules instead of imagined rules.

Winners understand the game and play accordingly. Losers complain about unfairness and stay powerless. Your odds just improved. Use this knowledge.

Until next time, Humans.