While the anti-trust laws are controversial in that there was never in the U.S. Constitution an enumerated power for the federal government to be able to interfere in the private business affairs of its citizens, now that we have the laws, we can turn around and apply them to the government itself: using their own rules against them.
The stated purpose of the anti-trust laws was to preserve the competitiveness that puts the pressure on businesses to serve their customers well, instead of poorly:
By 2010, the rubric utilized for determining the concentration of any market was the Herfindahl–Hirschman Index (HHI), which starts with the percentage share of the market for each firm, squares that percentage, and then sums the squared percent shares. If just 4 firms existed in a market with these respective market shares:
40% for the firm with the highest share
30%
20%
10% for the firm with the lowest share
… then the HHI would be (1600) + (900) + (400) + (100) = 3,000 — which is an oligopoly.
Notice how, using the formula on just the first firm with 40% market share, you already reach an HHI of 1600, and it can only ever go up from there. Knowing the top firm in a market, if it is high enough, can already lead to a classification, regardless of the share held by other firms — who always add less to the HHI than that first firm.
An oligopoly exists when just a few firms could form a cartel against the public, driving prices higher while lowering the quality of service. It bears repeating that the logic here is controversial (“free market monopolies” are actually reversible, and therefore they are not true monopolies enjoying the protection of a government).
In 2010, the DOJ and FTC put out merger guidelines that said that, if you begin with moderate market concentration, mergers that result in an HHI that is over 100 units larger (compared to before the merger) are potentially harmful:
But by 2024, the HHI levels corresponding to moderate market concentration reduced down to the range between 1,000 and 1,800:
This means that only an HHI below 1,000 indicates that your market is competitive, and markets with HHI values above 1,000 are presumed to have lost some competitiveness. Markets with values above 1,800 would be more severely hampered or compromised — no longer expected to serve the customers well.
The percentage share that could individually lead to a value of 1,000 right off the bat (without counting any other firms or institutions) is the square root of 1,000 — which comes out to 31.6%. If there is ever a single firm or institution with that much market share, then you are presumed to have already lost some competitiveness.
DOJ Guidelines applied to Total Government
Applied to the sum total of government spending as a share of GDP, the USA stopped being a fully-competitive nation in 1971:
Search at: The Federal Reserve Economic Data (FRED) for these 3 different series in order to recreate the graph above: ASLEXPND, AFEXPND, and GDPA
The total of all goverrnment spending in 1971 had reached 32.3% of GDP, indicating — by the very rules of the DOJ, itself — that government had grown too large. Anti-trust laws, once applied to the spending of all levels of government, indicate that government is too large — making the USA less competitive than it could be.
We don’t need a Great Reset which would result in our government growing, we need a return back to levels of the past when government in the USA was small.