Essentially what you're pointing out is that capitalism, while admirable in terms of the freedom it provides in its early stages (anyone can start a business and probably be successful just by working hard), eventually always ends in monopolies (eventually those businesses will be bought up or bullied into selling, creating one central mega-power - first one in each market, but eventually even different market verticals are all controlled by the same umbrella corporation - that's why you can buy bullets, baby diapers, and a gallon of milk at the same checkout at Walmart). There has to be a system to keep power decentralized - whether it's by regulation, taxation, incentive - whatever.
The sticky point, though, is that whatever method is used to keep that power decentralized must not either a) infringe on individual freedom, or b) simply make the government the monopoly.