How would this occur? In order to gain such power, the company would need it be massive. And with size comes inefficiency and waste. That is why the costs need to be externalized through government enforcement.

Government regulation guarantees regulatory capture and cronyism. They go hand-in-hand. It is the problem masquerading as the solution. Government is as susceptible to the same greed and power thirst you see in corporate CEOs, but completely divorced from any of the economic restraints of the market.

Remember, the government is by definition a territorial monopoly in violence. Everything the government has, it acquires through extortion and fraud. Even the most corrupt companies still need to provide goods and services people choose to purchase, but government merely plunders.