• If our government doesn’t act now to prevent it, corporate America will swallow our country’s small businesses whole when the coronavirus pandemic is over.
  • We saw that happen during the financial crisis. The banks that survived were the big banks, which got even bigger, and now we have less competition in the banking industry.
  • The $349 billion in government aid to small businesses Congress passed last week is being given out on a first come first served basis, which favors businesses with accountants and lawyers who can advise on the process.
  • Finally, protecting small businesses means not only giving them money now, but also blocking anti-competitive mergers and acquisitions when this is over.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit Business Insider’s homepage for more stories.

Let me remind you what happened during the financial crisis as our banking system started swirling down the drain.

Not just small banks went bust, but also big brand names like Washington Mutual and Bear Stearns. Banks of all sizes were swallowed by even bigger banks – which got huge – and now instead of having 14,500 banks like we did in the 1980s, we now have around 5,500.

This is story of consolidation and near-monopoly building, and if we aren’t careful, after the coronavirus pandemic it could happen all over the economy.

Small- and medium-sized retailers could get swallowed by Amazon and Walmart – companies that have the resources and cushion to get through disaster. Pharmacies will continue to get devoured by CVS and (to a lesser extent) Walgreens. According to US Chamber of Commerce poll, one in four small businesses says that they’re two months or less away from closing forever.

This isn't the way capitalism is supposed to work. We're supposed to have competition and choice. And in a perfect world, that problem would fix itself in the market. But this isn't a perfect world in the best of times. And a perfect world certainly wouldn't include the coronavirus.

On Friday the government started disbursing $349 billion in aid for small businesses. Basically the deal is the government will loan you payroll for you for a few months. If you don't fire people, that loan turns into a grant - basically a cash infusion like the $1,200 check a majority of American households are getting.

But there are already problems. Right before the program was about to roll out, JPMorgan - the most giant of all the giant banks that won the financial crisis - admitted that it simply wasn't ready to process and service these loans. And if the house of Morgan was having problems, it's not hard to imagine everyone else was having them as well.

On Friday the program opened to a chaotic first day, according to reports. Bank of America said that by mid-day, 58,000 businesses had asked for $6 billion in loans.

These loans are being given out on a first-come, first-served basis, which means the companies with the time and resources - meaning accountants and lawyers - to understand how to apply will get their first. Smaller businesses with fewer employees will have a harder time. It's also likely that they'll have less time to wait before things go south than bigger companies too.

All that said, this bill is just where the work starts. After the pandemic is over policymakers will need to consider how to keep small business that may be still struggling from getting consumed by big businesses that have recovered faster.

A fighting chance

What this means is what I've been advocating from the beginning - more money for small businesses faster - but that's just part of the story.

Once the dust settles companies that had to wait longer for money, or are located in parts of the country hardest hit by the pandemic, will be weaker. And that will undoubtedly give big corporations that want to get bigger the opportunity to pounce.

We could argue about this until the cows come home, but there are obvious parts of our economy where corporate consolidation has led to poorer outcomes for customers.

The airline industry is the perfect example. 20 years ago there were around 10 major carriers. Now there are four. These mergers were supposed to making things more efficient, but what they've really done is left customers with fewer choices, forcing them to put up with mediocre service and borderline collusive fee increases.

At the same time, as you've probably heard, instead of using their money and power to invest in improving their services, the four airlines that remained mostly bought back their own stock to made their shareholders (and consequently their executives) richer.

Consolidation has made it harder to fight the coronavirus too. This week the New York Times reported the story of the US government's failed attempt to building a cheaper, easier-to-use ventilator to build its stockpile.

It started back in 2006, when the government hired California-based Newport Medical Instruments to build a better ventilator. The effort stalled when a larger competitor, Covidien, bought Newport in 2012 and scrapped the project. Covidien claimed the US was asking too much, but it's more likely they simply didn't want to make a product that competed with the more lucrative ventilator it already had in the market.

The US has the tools to block anti-competitive mergers like this, we just haven't sharpened or used them in decades. It's one of the reasons why companies like Facebook and Google have gotten so big.

This issue was already starting to gain steam in Washington because of anger at the tech giants coming from both sides of the aisle.

Now, in the face of coronavirus, it's even more important that we use antitrust regulation to protect not just individual small businesses, but also the existence of competition in our markets entirely.