A Monopolizing Discussion

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Accountable
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Post by Accountable »

Monopolies:

Are they always bad?

Can one survive in today's economy without government backing?

If they become abusive, is legislation the only recourse?

To all of these questions I say NO. What say you?
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Post by Accountable »

Here is the conversation that sparked this thread. I'm hopeful we can continue it here instead of derailing the other thread.

BaghdadBob;1351283 wrote: Sure, I'll bite.

The best interests of the people is free market capitalism* with anti-monopoly regulation and multi-capitalist laws to ensure equal access to prosperity.

Capitalism is the most compasionate form of socio-governance as it advances the cause of man - freedom and wealth. From that wealth comes the livings standards we enjoy now.

Capitalism absent government intervention never fails. Socialism always fails.



*Capitalism is the respect for other's property and contracts and the antithesis of socialism.


Accountable;1351302 wrote: [QUOTE=BaghdadBob;1351283] free market capitalism* with anti-monopoly regulation This is an oxymoron; other than that, I agree completely.


Accountable;1351309 wrote: Name one successful American monopoly not protected by the government. In a free market, which we both support, an abusive monopoly cannot survive.


BaghdadBob;1351315 wrote: Umm, let's see...

John D Rockefeller w/Standard Oil. Carnegie and US Steel. Vanderbilt and the railroads.

None were 'protected'.


Accountable;1351318 wrote: The railroads definitely had gov't help.

I'll have to check on the other two & what actually happened to them in the end.


BaghdadBob;1351319 wrote: Teddy Roosevelt and the Sherman Anti-Trust Act is what happened to them.


Accountable;1351324 wrote: I'm sure that's the textbook answer, and it may be the truth. Do you think that such a strangle-hold type of monopoly is possible today? We're much more sophisticated now.
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Post by Accountable »

A History Of U.S. Monopolies

This is an interesting article on the subject. The author supports you, Bob, about Standard Oil being busted by the Sherman Antitrust Act. I asked for one & you gave me one. I have to adjust my stance.

It points out another, International Harvester, which was allowed to operate because of its popularity. It is still in business but no longer a monopoly, thanks to natural market forces.

Another, American Tobacco, abused its monopoly position and was busted up. I can't help but note that tremendous amounts of tax dollars still go to subsidize tobacco farms today (unless there have been very recent changes). I wonder if American Tobacco would have imploded if left alone.

US Steel did not fall to Sherman. It was picked apart by its competition. This is what I believe would happen to all of them if left to market forces.
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Post by yaaarrrgg »

Accountable;1351331 wrote: Monopolies:

Are they always bad?

Can one survive in today's economy without government backing?

If they become abusive, is legislation the only recourse?

To all of these questions I say NO. What say you?


I see a monopoly as a consolidation of economic power. So the questions are very similar to:

Is a consolidation of power always bad?

Can a consolidation of power be sustained without government backing?

If the situation becomes abusive, is legislation the only recourse?

IMO a consolidation is not always bad, but long term it almost always leads to corruption and abuse. So short term no, long term, yes.

Any series of economic competitions, you'll eventually end up with one winner: One large company that controls an entire market. This happens with or without government involvement. It's a result of taking two competitors and picking one repeatedly. So IMO yes.

The response is for people to boycott the business collectively, or use their voting power (via democracy) to reallocate the economic playing field. So IMO, no legislation is not the only approach. Though why shouldn't people use every tool they have available? Should people hop around on one leg versus using both legs? :)
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Post by Bryn Mawr »

Accountable;1351336 wrote: A History Of U.S. Monopolies

This is an interesting article on the subject. The author supports you, Bob, about Standard Oil being busted by the Sherman Antitrust Act. I asked for one & you gave me one. I have to adjust my stance.

It points out another, International Harvester, which was allowed to operate because of its popularity. It is still in business but no longer a monopoly, thanks to natural market forces.

Another, American Tobacco, abused its monopoly position and was busted up. I can't help but note that tremendous amounts of tax dollars still go to subsidize tobacco farms today (unless there have been very recent changes). I wonder if American Tobacco would have imploded if left alone.

US Steel did not fall to Sherman. It was picked apart by its competition. This is what I believe would happen to all of them if left to market forces.


By definition, if it is a monopoly it has no competition - in general they only come into existance with the government giving an exclusive licence to a single group or when a company holds a patent that cannot be bypassed.

Are they always bad? No, just almost always - exceptions can be found for every absolute of this form.

Can one exist today without government assistance? Yes - by holding a patent and refusing to licence other firms to use it.

If they become abusive is legislation the only recourse? See (1)
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Post by yaaarrrgg »

Bryn Mawr;1351346 wrote: By definition, if it is a monopoly it has no competition - in general they only come into existance with the government giving an exclusive licence to a single group or when a company holds a patent that cannot be bypassed.


That's a good point. If the government is enforcing private property laws, that sets the stage for monopolies. If we did away with the notion of intellectual property at the very least, that could break up some of the monopolies. Large monopolies would be burdened with the cost of R&D and their own large, sluggish size.

In open source software, companies can't monopolize a given piece of software because no one group owns it. The most they can do is become the most recognized brand name, and draw business by their good reputation.
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Post by Accountable »

yaaarrrgg;1351343 wrote: I see a monopoly as a consolidation of economic power. So the questions are very similar to:

Is a consolidation of power always bad?

Can a consolidation of power be sustained without government backing?

If the situation becomes abusive, is legislation the only recourse?

IMO a consolidation is not always bad, but long term it almost always leads to corruption and abuse. So short term no, long term, yes.

Any series of economic competitions, you'll eventually end up with one winner: One large company that controls an entire market. This happens with or without government involvement. It's a result of taking two competitors and picking one repeatedly. So IMO yes.

The response is for people to boycott the business collectively, or use their voting power (via democracy) to reallocate the economic playing field. So IMO, no legislation is not the only approach. Though why shouldn't people use every tool they have available? Should people hop around on one leg versus using both legs? :)
Consolidation of power almost always leads to corruption, which is an excellent reason to keep too much power from being consolidated in Washington as well. Washington should only be allowed to do that which only Washington can do.

I think if you look at the American economic competition, you'll find that we generally don't end up with a single winner, or at least we haven't in a long time. The last time Sherman was used was for a government-subsidized monopoly, AT&T. Coke & Pepsi; McDonald's & BK; Ford, GMC, & Toyota; Microsoft & Apple; the list goes on. We are far too diverse a society to pick a single winner.

I don't agree with your last paragraph at all. It doesn't come down to only those two options, and those are not equal in scope, effectiveness, or collateral damage (unintended consequences). Legislation should be the option of last resort, because it is permanent and takes away individual choice.
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Post by Accountable »

Bryn Mawr;1351346 wrote: By definition, if it is a monopoly it has no competition - in general they only come into existance with the government giving an exclusive licence to a single group or when a company holds a patent that cannot be bypassed.

Are they always bad? No, just almost always - exceptions can be found for every absolute of this form.

Can one exist today without government assistance? Yes - by holding a patent and refusing to licence other firms to use it.

If they become abusive is legislation the only recourse? See (1)Good summary. I think the legal definition of monopoly isn't as absolute as the dictionary definition. If I recall, it is something like 80% control of a given market.
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Post by yaaarrrgg »

Accountable;1351391 wrote: I don't agree with your last paragraph at all. It doesn't come down to only those two options, and those are not equal in scope, effectiveness, or collateral damage (unintended consequences). Legislation should be the option of last resort, because it is permanent and takes away individual choice.


What other options do you see?

Patents, are a good example of laws with unintended consequences. They were designed to give a temporary monopoly to the person who invested into the R&D, to help recoup the up front costs. That much is fair and makes sense to me. However, these laws don't make sense if we award an existing monopoly even more monopoly power. They become another tool in the toolbox, with which large corporations use to bludgeon the competition.

Do you think we should keep the partent laws as is? "Legislation" doesn't necessarily mean adding new laws on top of the mess we have; it can also mean subtracting the parts of laws that don't make sense anymore.

For example, about 10 years ago, a judge ruled that Microsoft was an "abusive monopoly".. the solution is they tried to split the company up. I think this approach was impractical. Instead IMO they should have invalidated all their patents and intellectual property claims.
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Post by Ahso! »

yaaarrrgg;1351438 wrote: What other options do you see?

Patents, are a good example of laws with unintended consequences. They were designed to give a temporary monopoly to the person who invested into the R&D, to help recoup the up front costs. That much is fair and makes sense to me. However, these laws don't make sense if we award an existing monopoly even more monopoly power. They become another tool in the toolbox, with which large corporations use to bludgeon the competition.

Do you think we should keep the partent laws as is? "Legislation" doesn't necessarily mean adding new laws on top of the mess we have; it can also mean subtracting the parts of laws that don't make sense anymore.

For example, about 10 years ago, a judge ruled that Microsoft was an "abusive monopoly".. the solution is they tried to split the company up. I think this approach was impractical. Instead IMO they should have invalidated all their patents and intellectual property claims.Good idea.
“Those who can make you believe absurdities can make you commit atrocities,”

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Post by Bryn Mawr »

Accountable;1351392 wrote: Good summary. I think the legal definition of monopoly isn't as absolute as the dictionary definition. If I recall, it is something like 80% control of a given market.


Over here the Monopolies and Mergers Commission get interested at about 50% but it does depend on how the market is being run.
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Post by Accountable »

Can we agree that majority control of a market to the point of being considered a monopoly doesn't mean the market controller is being unfair or abusive, or using illicit or illegal practices?
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Post by Bryn Mawr »

Accountable;1351843 wrote: Can we agree that majority control of a market to the point of being considered a monopoly doesn't mean the market controller is being unfair or abusive, or using illicit or illegal practices?


Easily as I know of circumstances where that is the case, however, the closer you get to a true monopoly the more I'd suspect four play.
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Post by Accountable »

Bryn Mawr;1351847 wrote: Easily as I know of circumstances where that is the case, however, the closer you get to a true monopoly the more I'd suspect four play.However many plays ;), it's no reason to prohibit it. Punish the abuse, if it occurs, but we shouldn't assume it will happen before it does. Whatever the history, developed nations of today are smart enough and mature enough to handle monopolies without outlawing them
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Post by Ahso! »

So you agree with the likes of Alan Greenspan and would prefer to scrap Antitrust Law? We may be at the point where we should perhaps give it a go. No skin off my nose.
“Those who can make you believe absurdities can make you commit atrocities,”

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Post by Accountable »

Ahso!;1351883 wrote: So you agree with the likes of Alan Greenspan and would prefer to scrap Antitrust Law? We may be at the point where we should perhaps give it a go. No skin off my nose.Anti-trust laws don't punish success, they punish abuse, which I just typed in the previous post that I support.
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Post by Bryn Mawr »

Accountable;1351861 wrote: However many plays ;), it's no reason to prohibit it. Punish the abuse, if it occurs, but we shouldn't assume it will happen before it does. Whatever the history, developed nations of today are smart enough and mature enough to handle monopolies without outlawing them


When a single player within a market becomes too big (and, for the moment, let's leave the question of how big is too big) then their very presence stifles competition whether they are playing fair or foul. Without the competition it is very difficult to know if abuse is occurring.

What we do know is that a competitive environment both stimulates development and keeps profiteering to a minimum - given that, I'd say that weighting the playing field against the development of monopolies was a reasonable tactic.

They have their place, when policed and regulated, but they're not a desirable end in themselves.
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Post by Accountable »

Agree to all points. Too big is more a danger than being a monopoly, though.
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Post by Bryn Mawr »

Accountable;1351958 wrote: Agree to all points. Too big is more a danger than being a monopoly, though.


As in, when a company goes multi-national and has a larger disposable income than many countries then they're hard to control- couldn't agree more.
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Post by Accountable »

Anti-monopoly laws don't touch them.
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Post by K.Snyder »

Accountable;1351331 wrote: Monopolies:

Are they always bad? I would say in theory monopolies are bad. My thoughts can best be explained by observing the market fluctuations associated with supply and demand. It's easy to see that when products are in high demand then prices jump to both accomodate the increasing supply that follows, which is no doubt linked, at perhaps varying degree, to greed by those that possess the authority and ability to produce those products. When those products are deemed a necessity to any healthy and morally acceptable living standard then monopolies serve to restrict the public's access to those needs which ultimately are not in the greater interests of the majority(Let's face it if the majority were in control of producing those goods then we wouldn't be having this discussion).

I'd say this would eliminate such a large separation between "necessity" and "luxury".

Accountable;1351331 wrote:

Can one survive in today's economy without government backing?People are not surviving both due to government and lack of government. The question is equilibrium on how we as a collective society defines "value" both monetarily as well as in principle.

Accountable;1351331 wrote: If they become abusive, is legislation the only recourse?

Legislation is recourse to a situation that, by any ideal standard, should be avoided at any cost. Cost being one that is rarely agreed upon by anyone with the ability to decide what's to be avoided, because "abuse" is something that requires an absolute price in theory while, sadly, one weighed upon it's merit in practice...

It's sad...sad



Sad really
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Post by gmc »

You cannot have a free market capitalist economy if you allow monopolies and cartels to prevail. Anti-trust laws do not harm a capitalist economy they protect it. Monopolies do inevitably fail it's a matter of how long they can last and how much damage they do in the process. Those who want anti-trust legislation or indeed any kind of business regulation removed are almost invariably working for a monopoly or one of their puppets or just plain stupid. You also need government to protect the people from the actions of big companies, if you want examples as to why see monsanto, mountain top clearance and fracking. Governments are elev=cted by the people for the people it is not givernment that is interfering it is the people saying hang on I am not putting up with this crap. Monopolies have badly damaged the American economy and got you in the present mess.

Adam Smith - the so called founder of capitalism also inspired the socialists, he argued for the role of government in controlling monopolies and in providing the infrastructure for industry to succeed, not just roads, no tariffs etc etc but also in providing access to education for all - so employers had access to an educated work force, he also advocated paying decent wages as an essential part on making the economy grow - you can't have a consumer led economy without consumers - the unemployed can't afford cheap cars made in mexico. He was a social democrat with very liberal views including education women - but then he grew uo in a country where education was compulsory and free up to at least secondary age

Socialism does work but you need a mixed economy for it to succeed. Americans are not qualified to discuss socialism since most of them have no idea what it is about, or capitalism either, If they did they would be voting for universal healthcare and to get rid of a fascist government.
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