One Capitalist always kills many. --Karl Marx, "Capital," 1867.

The great danger to the consumer is monopoly-- whether private or governmental.

--Milton and Rose Friedman,

"Free to Choose," 1980.

This, for any economist who can maintain the requisite mood of detachment, is a fascinating time. For 200 years it has been common ground for economists in the non-socialist tradition that the greatest threat to the free enterprise system, intrusive government possibly apart, is monopoly. The undoubted cause of monopoly, government sponsorship again for some excepted, is industrial concentration. Liberal and conservative economists have differed in recent decades over the extent of the concentration and the depth of the resulting danger. Liberals have come up with calculations showing that a comparative handful of the giants, a number small enough so that all the chief executive officers could be accommodated at the Kennedy Center on a single luminous evening, now account for between half and two- thirds of all private production. This means that numerous key industries are now dominated by a handful of huge firms, and modern microeconomics makes no real distinction between the monopoly of one firm and the tacit agreement or oligopoly of the few. Conservative economists, citing the same figures and accepting the same basic theory, have concluded that things are not quite so bad. But no one, or almost no one, in the free enterprise tradition has applauded the trend. Though showing an exemplary caution in citing him as a source, most economists, regardless of faith, would agree with Marx that concentration is an inherently adverse tendency of the system, departing only from his proclaimed pleasure in the result. With less concern for the association, they would agree with Friedman that monopoly (and oligopoly), the end products of the concentration, are the greatest danger to the consumer, which is to say the public at large. From Marx to Friedman--one cannot have a greater span of agreement than that.

Generations of conservative economists at the University of Chicago and elsewhere were educated by the late Henry Simons and his brilliant and uncompromising tract, "A Positive Program for Laissez-faire," to the belief that a vigilant government and citizenry could defend competition and the market against monopoly and the ultimate debacle. Simon's students, those of the revered Frank H. Knight, his colleague, and those in further descent therefrom made the competitive market a totem; indeed, no totemic symbol ever so marked a tribe. Coming now to the present, these are the men who are now prominent in public position or moral suasion in the Reagan administration. From none elsewhere in the world could one expect a more powerful defense of competition and the market.

Present also is the eloquent and greatly approved voice of George Gilder. Gilder has made clear his near abhorrence of the large bureaucratic corporation. It is the inescapable fact of corporate concentration that the large corporate bureaucracy swallows up the smaller entrepreneurial firm, which Gilder pictures with an approval verging on mysticism. Thus the fascination. Coinciding with the arrival of the dedicated defenders of the competitive market and the entrepreneur in Washington has come a terrific assault on both. It is, quite probably, the most massive such attack in history.

The papers each day tell the story. During the first six months of this year, the dollar value of corporate acquisitions at $35.7 billion was nearly as great as for all 1980. And this was be fore the recent really great acceleration. Even the largest companies--Conoco, the ninth largest oil company--are no longer immune. And this assault-- this merger and takeover frenzy as it is being called--is occurring with the evident approval of the very administration on which the hopes of the defenders of the market and the entrepreneur were centered. The New York Times a few days ago, excelling even itself in cautious use of the language, concluded that "the perception of a more favorable climate in Washington is widely believed to be a factor in the current 'merger mania.'" It cited the more forthright statement of Attorney General William French Smith that "bigness in business is not necessarily badness." That bigness--corporate concentration--is bad was, he implied, one of the "misguided and mistaken concepts" he was committed to rooting out.

That the administration is indifferent to the predictions of Karl Marx is, perhaps, not surprising. One does not get the feeling that he is currently a presence in the Department of Justice or the White House mess. For some years there has been a liberal convocation, one to which I belong, which has held that the large bureaucratic corporation is inevitable, that the antitrust laws are a weak reed, that some form of public control will eventually supplement the market and that lemon socialism--public rescue operations as in the case of the eastern railroads, Lockheed, Chrysler and, any time now, Pan Am--will make an increasing number of firms either temporary or permanent wards of the state. But we are not the constituency to which the administration, in its acceptance of the merger mania, turns naturally for support.

So one returns to its own constituency, which is the men and some women who profess to be serious about the market. Where in heaven's name are they? Some no doubt are saying that concentration is not yet all that serious. That is to say that the patient, though admittedly afflicted, need not be treated. One eshould always wait until the disease is mortal. Not a good defense. Others, including Friedman, hold that freedom in international trade is a remedy. But this encounters the difficulty that the Reagan administration in its first venture into trade policy arranged for the spontaneous restriction by the Japanese on automobile exports. And international trade does not effectively curb the market power of modern inter national corporations. They own foreign competitors. And, trade or not, they swallow up those admirable, restlessly innovative and competitive entrepreneurs. There is no defense here.

Possibly those who worship the market are in deep shock over what the administration is allowing. Or perhaps their loyalty to President Reagan and a Republican administration is outweighing their lifelong commitment to the market and to competition. Or maybe all that talk about the wonders of the free competitive market was just so much hot air. You may take your choice.

The writer is professor emeritus of economics at Harvard.