power in the political sphere, bribing public officials, running
their own slates of candidates in elections, and aggressively
lobbying governments to pursue policies in their direct
corporate interests, but arguably against the public interest.
Rising public concern about the growing power of these
economic “trusts” led to the passage of the Sherman Antitrust
Act in 1890, designed to prevent the abuse of economic power
in the marketplace and also to reduce the potential for
successful businesses to influence political outcomes. In the
early 1900s, under President Theodore Roosevelt’s progressive
political agenda, the Sherman Antitrust Act was used to scale
back corporate concentration in many sectors; in 1911 it was
used to break up Rockefeller’s enormous Standard Oil empire.
Over the subsequent century, American antitrust policy was
used routinely to prevent mergers that would otherwise create
undue market power and to block firms from pursuing
“uncompetitive” practices.
The Recent Rise of Corporate Profits
Corporate profits in the United States have recently been high
by historical standards. As cited in The Economist magazine,
U.S. corporations’ global return on invested capital, which
varied between 8 and 11 percent between 1963 and 2000,
increased to the 12–16 percent range over the last decade.*
While roughly one-fifth of these profits are earned outside the