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There is an ideal size of organization. Too big gets you massive inter-communication & co-ordination problems (grows exponentially with # employees), excess complexity, and elephant vs. mouse action in market place. Too small gets you high % of overheads per sales $ generated, reducing profits and raising break-even point.
Studies have shown that maximum competitiveness occurs among 3 companies who have 54%, 27%, and 14% market share, and everybody else fights over the remaining 5% of the market (Law of 3 of 4). Some estimate the optimum efficiency to be 200 employees.
If the wall street boys love doing M&A's (Mergers & Acquisitions), creating bigger and bigger corporations, we are all put at risk and disadvantage. They get so big that they get to dictate and have too much power. We also have "too big to fail".
How about having sliding tax margin rates and surtax, windfall taxes, etc. so that parent corporations and all their subsidies are taxed for size, as well as profits. If you want to be big, you're going to pay to be big.
If you own 13% of a subsidiary, then you add 13% of the child's data to the parent's size tax calculation. Creating many legal entities all controlled by the central power will not save you from the sting of this super-sized tax.
The top end will be ~90% tax. Somewhere between 0 and 90% tax will be the optimum for the various sectors of the economy, each sector finds their own sweet spot.
I'm sure the FDIC can tell us approximately where the ideal bank size is located. Obviously, "too big to fail" is no where near that point, and the "too big" banks will pay excess tax till they divest some divisions or branches, or assets, or people. They can shut it down as a loss & tax writeoff, or spin it off and sell it as a going concern (obviously better ROI for shareholders).
The reason the Internet is sabotage- and disaster-proof is because of massive redundancy. Large sections can simultaneously fail, but the Internet backbone continues to work. The banking sector, auto sector, pharma sector, oil sector, etc. should perform the same, with massive reliability. While FDIC gets a failed bank re-booted, we continue on, virtually unaware there has been a problem.
Same as Standard Oil and AT&T breakup under anti-trust, but without huge lawsuits, decades to resolve, unfair picking of DOJ's next victim, etc.. Law is applied similarly and automatically to all.
Studies have shown that maximum competitiveness occurs among 3 companies who have 54%, 27%, and 14% market share, and everybody else fights over the remaining 5% of the market (Law of 3 of 4). Some estimate the optimum efficiency to be 200 employees.
If the wall street boys love doing M&A's (Mergers & Acquisitions), creating bigger and bigger corporations, we are all put at risk and disadvantage. They get so big that they get to dictate and have too much power. We also have "too big to fail".
How about having sliding tax margin rates and surtax, windfall taxes, etc. so that parent corporations and all their subsidies are taxed for size, as well as profits. If you want to be big, you're going to pay to be big.
If you own 13% of a subsidiary, then you add 13% of the child's data to the parent's size tax calculation. Creating many legal entities all controlled by the central power will not save you from the sting of this super-sized tax.
The top end will be ~90% tax. Somewhere between 0 and 90% tax will be the optimum for the various sectors of the economy, each sector finds their own sweet spot.
I'm sure the FDIC can tell us approximately where the ideal bank size is located. Obviously, "too big to fail" is no where near that point, and the "too big" banks will pay excess tax till they divest some divisions or branches, or assets, or people. They can shut it down as a loss & tax writeoff, or spin it off and sell it as a going concern (obviously better ROI for shareholders).
The reason the Internet is sabotage- and disaster-proof is because of massive redundancy. Large sections can simultaneously fail, but the Internet backbone continues to work. The banking sector, auto sector, pharma sector, oil sector, etc. should perform the same, with massive reliability. While FDIC gets a failed bank re-booted, we continue on, virtually unaware there has been a problem.
Same as Standard Oil and AT&T breakup under anti-trust, but without huge lawsuits, decades to resolve, unfair picking of DOJ's next victim, etc.. Law is applied similarly and automatically to all.
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