Brendan Keenan: 'Whatever their image, the global companies hold most of the cards'
Are the Titans trembling? The sound of wheels turning can be heard in politics and social mores, but there are also strange whirrings in the strange, relatively new, world of 21st century industry.
It was always a favourite of science fiction that, one day, we would all be ruled by a handful of giant companies - maybe even by one global monopoly. I don't think any of the older books ever forecast that this would come about through control of information gleaned from everyday stuff like, er, buying a book, or looking at a weather forecast.
Even so, the power of the big IT companies, and the danger which comes from that power, is as great as any science fiction could envisage. On the other hand, we have been here before, with railway companies, car manufacturers and oil barons. The wheel turned for all of them.
One could possibly read something of the kind into several recent events. There are the falls of around 20pc in the share prices of the titans, Amazon, Google and Apple. These are sharp declines, but one can see old-style logic behind them.
Share prices should reflect future expectations. For a long time, tech shares have assumed a continuation of the stellar growth of recent years - but, of course, if something cannot go on for ever, it will probably stop eventually.
In Apple's case, there was a feeling that everyone who is likely to buy an iPhone probably has one already. With the others, that politics may curb their future growth.
Even rational explanations cannot entirely hide the shock of the mighty falling. But there have been other signs that they may not always be masters of the universe, which may have infiltrated market sentiment.
Amazon received quite a pasting over its naked auctioning of a major investment among US cities. It is adopting the stance of Michael O'Leary which was that Ryanair was not a customer of the airports: because the planes could move and the airports could not, they were customers of Ryanair.
He got criticised too, but at least there are only a few airports to choose from in any destination. Amazon was able to play off several cities - although, in a 21st century twist, some observers think it was more interested in the data it acquired about the contenders than the money they were offering.
In the end, its second headquarters will be split between New York City and Washington DC. It appears that only the largest cities can meet its needs - a reminder of the limit of Ireland's attractions - although New York is still putting up $3bn (€2.62bn) in sweeteners.
There are growing objections to this bribing of the world's richest companies. The NYC answer - like that of governments everywhere - is that it must pay to get the jobs. Economics would seem to dictate that, as location becomes an ever more competitive market, the firms will end up with the bulk of the benefits.
Perhaps most intriguing is the evidence of dissatisfaction among staff at the multinational companies. Fairly or not, Amazon is already widely regarded as a sweatshop, but the Californian gloss over others, with their futons and swimming pools, is also starting to wear thin.
Google, perhaps the glossiest of them all, has been under fire in the difficult area of harassment, sexual and otherwise. There may be more long-term significance in the signs of traditional worker activity in support of better conditions.
It did feel like some kind of cultural change, listening to staff complaining, rather than celebrating how lucky they were to work for such a company. A recent case at Boston Scientific in Ireland is an early example of why the world may not have changed as much as is often claimed.
The dispute was complex and had much to do with union recognition. Many workers would be glad to enjoy the pay and benefits at the company but, whatever the rights and wrongs, and whatever the long-term wisdom of such demands, the Siptu action showed that multinationals are not immune from the more traditional ways of doing things.
Underneath all this is the growing perception of big companies - and not just foreign ones - as tax dodgers. History suggests that unpopular companies eventually come to a sticky end. They should certainly worry that a Conservative government in Britain is one of the first to introduce a digital sales tax.
But the problem is tax avoidance on profits, not sales. It is true that the value of sales cannot be written down in accounts in the way that profits can, but it is also true that sales taxes - such as Vat, for instance - fall on customers, unless the market is so competitive that it cannot be passed on.
This is certainly not the case among the titans. Given that most of them are virtual monopolies in their sector, even sales may not be much affected, and profits not at all. It also seems that those profits, and their spectacular growth, may be a problem in themselves, irrespective of how they are taxed.
The Bank of England, for one, has done a lot of research on the topic and found that the changing nature of big business is having a significant impact on the nature of the economy and the ability of policy-makers to govern it effectively.
It is a little while ago now, but a speech by the bank's chief economist, Andy Haldane, at the central banks' annual gathering in Wyoming summed up the results. Perhaps the most striking findings were those on company mark-ups over the past decades.
Of 10 sectors examined, all but two have seen mark-ups rise since 1987, some to an extraordinary degree. Six of them enjoyed increases of more than 30 percentage points. Mark-ups in the manufacturing, professional and scientific, and transport sectors have risen more than 60 percentage points - by 70 percentage points in the case of manufacturing.
Looking at the figures in more detail, it can be seen that size matters, but so too does globalisation. In the UK, firms selling mainly into foreign markets had average increases of 60 percentage points in their mark-ups, compared with just 15 percentage points for those largely confined to the domestic market.
The assumption is that those operating internationally benefit from global economies of scale and scope. They are also the most profitable, leading to the striking conclusion that the bigger the profit margin, the faster it increased.
Companies in the top 25pc saw their mark-ups rise by 50 percentage points since 1987 while the bottom quarter saw hardly increase at all. The gap has widened dramatically as a result.
The difference between the average increase for all companies and the typical (median) mark-up was seven percentage points in 1987, but this gap increased to 44 percentage points by 2016 as the "superstars" pulled away.
The scale of margin increases among the other titans is such that Mr Haldane agues it has changed the nature of the economy and the traditional relationships between prices, wages and employment.
The research suggests that bigger mark-ups for these companies have added 1pc to inflation. Yet inflation has been very subdued, possibly because offsetting factors such as loss of worker power in such companies has kept wages, and therefore prices, down.
A less obvious consequence of such market power is that it may explain the poor performance of investment and productivity in recent years. With such dominance, and the ability to increase gross profits so enormously, why spend money on investments to cut production costs?
Even less obvious, except to the initiated, is that these kinds of conditions reduce the effectiveness of interest rate changes by central banks - especially the point where rates are so low that further cuts have little impact.
From a purely selfish point of view, Ireland may take some comfort from the thought that reducing the profits of global companies will not be easy, and there will still be ways to keep the country as a desirable resting place for such profits.
Based on the research, all countries may have good reasons to keep trying to halt and reverse the rise in mark-ups. This will not be easy either.
It is one thing to create competing companies out of dominant giants in railways, cars or oil, quite another to do the same by breaking the likes of Google or Apple into constituent parts.