The New York Times did a superb series this fall on how large corporations changed American law to neutralize a major consumer protection — the class action lawsuit. Arbitration clauses mean a single consumer goes up against multi-million dollar legal teams, a hopelessly mismatched battle.
I realize that’s why Aetna can get away with cutting health insurance costs through strategic incompetence. Ten years ago if they were routinely evading their contractual obligations they’d be subject to a multi-million dollar suit. Sure, any penalties would be too small to truly impact Aetna, but a potential payoff would be big enough to fund a suit. More importantly, once a judgment was made, Aetna would need to wind the scam down — a recurring judgment might eventually amount to real money.
Today there’s really no downside for them. I’m certainly not going to take them to arbitration. So, yes, the Feds should block Aetna and Anthem’s acquisitions, but this is just one facet of a much bigger problem. The modern mega-corp has damaged our political and commercial landscape — from secular stagnation to political corruption. It may take the second coming of Theodore Roosevelt to set things right.