California and the Eleven Dwarfs Take on the Paramount-Warner Bros Merger

In Wealth of Nations, Adam Smith foresees that capitalist industrialists could collude with government at the expense of labor. In On the Genealogy of Morals, Friedrich Nietzsche argues that keeping laborers to a subsistence wage is necessary for capitalists to have enough wealth accumulated to invest in culture. Rather than being immoral, exploitation is simply part of life and thus the resulting economic inequality cannot be removed at its source. Low wages may simply be a feature of how labor supply typically relates to business demand for workers, whereas highly educated professionals are not so numerous and can demand higher compensation. Meanwhile, what about consumers as capitalist industrialists continue to accumulate capital in part by being able to pay large workforces subsistence wages and engage in mergers and acquisitions, such that competitive markets are turned into oligopolies and even, as in the case of Rockefeller’s Standard Oil in the 1870s, monopolies capable of extracting “monopoly rents”? In the U.S., the Sherman and Clayton Acts in the early 1900s were oriented to safeguarding competitive markets from being undermined by business titans, but enforcing those federal laws would seem to fly in the face of collusion between capitalists and their respective governments. As a case in point, the U.S. Justice Department gave the green light to Paramount’s take-over of Warner Brothers/Discovery even as President Trump had a financial interest in the deal going through. In the American federal system, the state governments could act as a check, and on July 13, 2026, the announcement came that California plus eleven other states, led by their respective attorneys general, filed a lawsuit challenging the merger on the basis that it would violate Section 7 of the Clayton Act. American consumers had reason to be thankful that they were still in a federal republic of republics, even though the growth of power at the federal level had nearly eclipsed the federalism, at least as it was originally intended—as enabling checks by the feds on the states and vice versa.

The Clayton Act “holds that mergers that may substantially lessen competition or tend to create a monopoly are illegal.”[1] In seeking to acquire Warner Bros. Discovery for $111 billion, Paramount’s mega-merger was raising concerns before closure that “combining two major Hollywood studios would hurt the industry while giving too much power” to Paramount’s CEO, David Ellison, in the film and television industries.[2] Hence California Attorney General Rob Bonta “led a group of 12 attorneys general in filing a lawsuit challenging the merger, claiming it would ‘lead to higher prices, lower quality, and less content for film and television, harming movie theaters, basic cable distributors, and ultimately audiences on every sofa and movie theater seat in the U.S.’”[3] In other words, all that typically goes with a competitive market becoming first an oligopoly, with just a few suppliers each with substantial market-share and thus market-power with which to become price-setters rather than takers, and then possibly even a monopoly in which consumers have only one choice of supplier and thus must pay whatever that supply decides. Because Paramount had completed an $8 billion merger with Skydance Media in 2025, the addition of Warner Bros. Discovery would give rise to tremendous market-power, hence occasioning an oligopolistic industry-structure. 

It is because the U.S. Justice Department announced on July 10, 2026 that even incorporating Warner Bros. Discovery would not harm competition and could even “strengthen competition across the media and entertainment industry, including in streaming video, traditional television and theatrical film distribution” that California and eleven other states jumped into action on the following Monday.[4] That a supplier with such massive market-power would actually make the industry more competitive is hard to believe, for, as Adam Smith lays out in his classic text on competitive markets, each supplier must be small enough relative to the entire market that no one supplier could set prices, but instead would have to take whatever prices are set by supply and demand, mechanistically in the market rather than by the intention of a dominant CEO.

Fortunately, under the U.S. federal system, “state attorneys general retain independent authority under antitrust laws, and the DOJ’s decision [would] not prevent additional legal challenges” to the proposed merger.[5] The personal financial interests of high officials in the U.S. Government, whether in the White House or Congress, could be checked, in effect, by the governmental sovereignty retained by the states, for in U.S. federalism, like E.U. federalism, governmental sovereignty has been divided between the federal and state levels, such that each would have an autonomous basis upon which to challenge over-reaches by governmental institutions on the other level. Put crassly, wealthy capitalists seeking a mega-merger would be best advised in both the E.U. and U.S. to pay off enough key federal and state officials so no one on either level would be motivated to institute a judicial contest. Other things equal, a federal system means that corruption by business of government costs more.

Federalism itself can thus be seen as serving a public purpose for the good of the whole. Were governmental sovereignty to reside exclusively only at one level—federal or state—as in a consolidated government and a confederation, respectively, it would be easier for powerful CEOs of large corporations to be able to engineer mega-mergers at the expense of market competition. In 2026, it was thus in the interest of American and European consumers to balance their respective federal systems, with more governmental autonomy going to the American states at the expense of the federal government, and more governmental authority going to the E.U. at the expense of the member-states. Perhaps as a result, more industries could be remade into competitive markets from being too oligopolistic and even de facto monopolies. 

To be effective, anti-trust laws must be enforced even if business executives and boards don’t exactly like the idea and would rather buy off governments at the expense of labor, consumers, and even the economic systems themselves, for there is a certain beauty to forces of supply and demand finding equilibria without any one participant (or few participants) being a price-setter as well as a policy-setter for an industry as a whole. The sheer frustration that typically goes with calling a company’s customer “service” phone-bank cries out for the existence of competition, and thus consumer choice. When that choice has to do with entertainment, and thus with which stories get told and with how much creativity and variety is possible, having a number of struggling suppliers (i.e., different gate-keepers) rather than just a few centralized powers is arguably crucial.

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1. Brian Flood, “Paramount Advisors Push for California Exit as State Sues to Block Warner Bros Discovery Merger: Report,” FoxBusiness.com, July 13, 2026.
2. Ibid.
3. Ibid.
4. Ibid.
5. Ibid.

Political and Economic Elites

I submit that in virtually every political party, a distinction can be made between the “rank and file” and the political elite. Kamala Harris may have lost to Donald Trump in the 2024 U.S. federal-presidential race in part because Harris had not spoken out enough on economic issues amid soaring inflation on groceries and rents to gain traction with Democratic and Independent voters who had had enough of the “woke” ideological agenda, which includes, for example, moral pressure and even demands that people announce their “pronouns” before speaking. Although President Biden had initiated some anti-trust judicial action, the industry-oligopoly of meat producers, for example, was left untouched. So too were the mega-grocery-store chains. Kroger was later found to have spiked egg and milk prices above the increased costs with impunity, yet Harris did not suggest that the Sherman or Clayton anti-trust acts should be taken out of the garage for spin on the American judicial highways that connect the rank-and-file party-members to party elites mainly in New England, New York, and California. I contend that U.S. Senator Bernie Sander’s anti-oligopoly speeches in conservative Congressional districts gained such numbers in 2025 precisely because the Democratic Party’s elite had lost touch with the party’s “rank and file” voters on economic issues.[1]

In early May, 2025, Faiz Shakir, a top advisor to Sanders, castigated elected Democrats who want “to talk down to” voters as if ordinary people are “just too dumb to understand the general notions of powerful elites running” the show, presumably both in politics and business.[2] I don’t think it is lost on many Democratic voters that Democratic office-holders taking campaign donations from oligopolistic companies have been less than willing to urge the U.S. Department of Justice to prosecute large companies on the basis of restraint of trade. Virtually no elected official in government who takes a significant amount of “corporate cash” would be willing to propose a law strengthening anti-trust law such that governments in the U.S. would have a duty to restore monopolistic and oligopolistic industries to market-competition even if the existing firms are not colluding on price or other matters.

For example, since its early days, Facebook (then Meta) has actively bought out budding potential competitors. Social media became an oligopolistic industry in part because of that strategy. Whether or not Meta has engaged in restraint of trade, the U.S. Department of Justice could be given the legal mandate to break up the large American social-media companies in order to bring about a competitive industry. A monopolistic or oligopolistic industry cannot be counted upon to metamorphosize itself naturally into a competitive market; rather, the reverse tends to occur. Hence the need for government to act to perpetuate competition in industries.

This is not to say that Democratic and Independent voters would or should accept Sanders’ platforms of “Medicare for All” and free college-tuition at public colleges and universities. Rather, his “relentless focus on economic policy” could have improved his party’s chances to retain the federal presidency by countering “swing voters’ belief [that] Democrats are too close to feckless institutions and too obsessed with culture war issues.”[3] U.S. Senator Chris Murphy, also a Democrat, observed about six months after the 2024 election, “We viewed people like Bernie as an outlier threat to the institutional Democratic Party, when in fact what he was talking about and is still talking about is the crossover message. And it pulls Trump voters back into the Democratic coalition.”[4] Both the Hilary-Clinton-dominated party elite in 2016, which was rather unfair to Sanders, and the Kamala-Harris presumptive-nominee fiat in 2024 demonstrate the lack of willingness of the party’s elite to select its nominees for president by competitive (and fair, open) contests. This lack of political competition mirrors the lack of economic competition that has continued to plague many American industries at the expense of consumers.

Lest the attention on price-spikes from President Trump’s tariffs monopolize the public discourse on prices that American consumers must pay to have even staple products, another, more widespread, reason for higher prices may be right under their proverbial noses and yet many Americans, both as voters and consumers, may continue to be oblivious to the bad odor of greed that has fueled collusion not only within industries, but also between business and government. An anti-elite populism preached by Democratic candidates and office-holders who refuse corporate donations could really make a difference in setting the Democratic Party apart from not only Trump’s Republican Party, but also the status quo itself, whose gravitas can be likened to that of the Earth in its magnitude and relentlessness. Elites may have such a foothold in American politics and business that many party-members and consumers may be left with only a vague instinctual sense that “the gig is rigged.” For the powers that are able to frame the contours of debates on issues, including on which issues will be debated publicly, do so with a keen eye on retaining and even gaining power and wealth. Hence making the contours explicit, and uncovering the underlying vested interests, is vital to restoring bottom-up democracy and competitive markets in the United States. Faith in American democracy may boil down to the precipitate of ordinary people resisting entrenched, powerful interests even in their own political parties.

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1. An oligopoly is an industry in which a few companies dominate. An oligopoly is between a monopoly and a competitive market. Prices on products can be higher than necessary, the surplus revenue going to profits. Sellers are price-takers rather than price-setters in a competitive market, whereas companies in an oligopolistic industry have sufficient market-power to set prices because consumers have few choices.

2. Igor Bobic, “Bernie Sanders: Resisting Trump Is ‘Not Good Enough’,” The Huffington Post, May 6, 2025.

3. Ibid.

4. Ibid.

Pittsburgh Businesses Encroach on Public Property with Impunity

Private property, competition, and the market-mechanism have come to be assumed to be integral to the economic system of Capitalism. The assumption that this cluster of attributes is necessary is faulty though, as, for example, the state can own some or all of the “means of production” (i.e., firms) that are subject to market competition, especially if privately-owned enterprises also exist. China had a mix of private and state-owned enterprises compete in several industries when the state opened the economy to competitive forces setting supply and demand. In Wisconsin, the Green Bay Packers, an NFL football team, is owned by the residents of that city, such ownership being Socialism, and yet that team has competed not only to win, but also in the hiring of players and managers. A competitive market does not require that the property of the means of production be privately owned. Even in the case of private ownership of companies, the widely accepted custom wherein the owners receive the residual profits after expenses is dogmatic in the sense of being arbitrary. Alternatively, creditors or employees/managers could receive any excess revenue after expenses have been paid. In short, Capitalism as it has come to be known and exercised is more arbitrary than capitalists may realize. Even the taken-for-granted distinction between public and private property is not as stark as may be typically supposed. This is no excuse, however, for businesses that knowingly encroach on public property as if it were their own private property. A Capitalist economic system predicated on private property may contain not only the seed of monopoly, as Marx claimed, but also a tendency of private enterprises to over-reach on the public domain. If so, government has a responsibility to prune back the overweening tentacles. Two examples make this point.

Once while walking on a narrow sidewalk, I glanced down at my phone and was instantly startled as I ran into and tumbled over a metal chair in the middle of the sidewalk. A restaurant’s employees had set up tables on the side of the sidewalk with chairs out into the middle of the sidewalk, and a bit beyond a table had been placed in the middle of the sidewalk, with a potted plant placed making it even more difficult to navigate around the tables and chairs. Who would want to eat in the middle of a sidewalk, with people passing by at close range? The manager of that restaurant was guilty not only of missing this rather basic point, but also of the incredible presumption that the public sidewalk was essentially part of the business’s private property, which astonishingly placed the public at a disadvantage on public property!

A month earlier, I had called the zoning department of the city. I had been assured that a restaurant cannot obstruct a sidewalk. However, the city then failed to act, perhaps capitulating to the business interest (and wealth). So, after I nearly fell from running into the chair, I called the city again. The employee who answered insisted that the city gives permits allowing businesses to permanently block or obstruct public sidewalks. So, I called again and spoke with another person who had more of a sympathetic ear when I explained that I had almost fallen, and that a hazard exists because numerous pedestrians walk into the street because of the obstruction. Two weeks later, with Franks Bar and Grill still interlarding on public property, I left a phone message for the code enforcement person. Two weeks after that, as the photo below demonstrates, the restaurant was still blocking the sidewalk. 

I know that the city had opened an investigations months earlier, so I surmise that the restaurant's owner or manager knew of the complaints and dismissed them. Additionally, I suspect that the city of Pittsburgh had bowed to the business interest at the expense of the public good. This is as much of a problem as is the presumptuousness and dismissiveness of a business that can take advantage of a corrupt municipal government.

Another example of companies encroaching on public "space" is the overreaching of security guards and private police employees presuming that their turf extends beyond a company's private property. When I lived temporarily in Pittsburgh, while I was walking on a public sidewalk along a hospital that was part of the University of Pittsburgh, I stopped at a food-truck only to realize that a security guard was perched on a small hill from which he seemed to have been presumptuously patrolling the sidewalk. In the distance was another security guard. 

Initially, I thought he was in line to order food from the food truck as I was. So I held back. Strangely, he likely viewed my standing position with suspicion, or, more likely, dislike as I was looking generally in his direction. Not all subtle, he strategically walked past me up close and stopped further along on the sidewalk, presumably there to talk to another food vender, yet his body position reveals his real orientation. 

The presumptuousness of that university-affiliated hospital was visible in the choice of the security guard’s uniform mimicking that of the police—including with a silver “badge” and handcuffs. If the hospital was breaching the state's monopoly of police powers, which in general is a larger problem, I submit that the visible artifacts added to the possible presumptuousness of the wearers that company security hyper-extends "off campus" even if the state permits it. The artifacts also misled the public into supposing that the company's police were the same as the city police. At the very least, a company's private security or "police" employees do not necessarily receive the same training as the regular police receive. There is also the problem of legitimacy from a democratic standpoint once the state's monopoly of police powers, as per the U.S. Constitution, is violated by companies. 

Just a public property is distinct from private property, a company's employees are distinct from a government's police force (and power). Encroachment onto a government's use of force puts a company in a conflict of interest in that its security employees are not in an even-handed position in disagreements between a company's management and its stakeholders. Human nature being what it is, we should not assume that the employees would be fair in cases in which a management oversteps its own authority ethically or legally. 

I contend that business managers have a tendency to overreach, even perceiving public property as fair game to be captured for the private, narrower, interest of a business as the public interest suffers. This tendency on the microlevel is the same as that which fuels a company in a competitive industry to become a monopoly. John D. Rockefeller, for example, pressured competitors unwilling to be bought by his Standard Oil company. The titan had the audacity to view himself as a Noah saving the drowning competitors from being ruined by the destructive competition especially in the 1860s, and as a Christ-figure saving them. Unlike Rockefeller, Jesus in the Gospel stories does not kill off people who are unwilling to accept his help. Rockefeller even pressured the railroads to pay Standard Oil a “drawback” when they carried the oil of his competitors. Such encroachment breached what was thought to be ethical business conduct at the time, which in turn included some practices that would come to be regarded as unethical. The titan’s presumptuousness thus extended to treating the railroads as akin to his own property. By such means of encroachment, Rockefeller built his company into a monopoly in the refining industry. Fortunately, the U.S. Supreme Court broke up Standard Oil in 1913, but made the mistake of keeping in tact the same ownership in all of the resulting companies. The managements thereof were even allowed to be in the same building! A willingness to stand up to powerful businesses and competency as to how to break up their excessive market power from previous encroachments are both important if the private-property attribute of modern Capitalism is not to eviscerate the attributes of competition and the market-mechanism. Given the tendency of business managers to shirk the public interest, society needs some means of protecting public property from the inevitable encroachments.

On the Merger of Comcast and NBC: A Structural Conflict of Interest

On January 18, 2011, Comcast received government approval to acquire NBC Universal. This followed a lengthy review, which mandated a list of conditions. The most important of them is aimed at preventing the new media conglomerate from thwarting competition in online video. However, even though regulators described their review as the most intense scrutiny ever for a planned media merger, Comcast managers said they believed their company faced few onerous restrictions from the review. “I don’t think any of the conditions are particularly restrictive,” said David L. Cohen, executive vice president of Comcast.[1] This statement ought to give readers some pause.

The full essay is at Institutional Conflicts of Interest, available in print and as an ebook at Amazon.

1. Tim Arango and Brian Stelter, "Comcast Receives Approval for NBC Universal Merger," The New York Times, January 19, 2011.