Came across a piece on Reuters.com by Richard Stallman entitled “Fixing too big to fail“. Mr. Stallman lays out an argument for keeping large banks and companies from getting too big by increasing the taxes on their revenues whenever they get larger. The higher taxes will force the companies to split up and get smaller.
The author goes from banks to companies in general, which is confusing. I didn’t know the too big to fail argument also encompassed other companies, but so be it.
Unfortunately, like so many other advocates who are afraid of any corporation bigger than the local hole-in-the-wall jazz club, Mr. Stallman never discusses why large is bad other than repeating the same tired line from the Obama administration.
I agree with an earlier commenter who discussed production and economies of scale. Unless Mr. Stallman can also suggest how incomes are to increase in order to pay for the higher prices smaller companies will charge consumers for services due to their higher marginal costs, the Chinese model of thousands of cooperatives replacing the few large corporations won’t work.