Myth of Capitalism: Monopolies and the Death of Competition | Hacker News Reader

Myth of Capitalism: Monopolies and the Death of Competition

brontecapital.blogspot.com

30 pointsfmihaila24 comments

Trust-busting was a thing in the past, Teddy Roosevelt was known as the trust-buster, and ran against Taft with the Bull Moose party, splitting the R vote. Taft actually was more prolific with trust-busting than Teddy, it may be his biggest presidential legacy.

Gary Kasparov pointed this Taft fact out as well, so people are thinking about the need to break up monops.

I sort of worry with a global system, you break up a local monopoly, will a foreign monopoly take over the vacuum?

> I sort of worry with a global system, you break up a local monopoly, will a foreign monopoly take over the vacuum?

I share your concern, but I perceive it slightly differently: state-sponsored corporations of very uncapitalist regimes such as China are free to throw their weight around to derail and manipulate capitalist economies to their favour. How can a free and democratic nation ensure that their capitalist system can function if a super-power is dedicated to sabotage it to help further their agenda?

Limit free trade. This isn't even restricted uncapitalist uncountrys [0]. With absolute free trade, you end up undermining the laws of every juristiction unless you have some authority who can set common rules.

This is great when we are undermining laws of nature, much more case dependent when we are undermining explicit policy decisions.

[0] And frankly, what country is entirely capitalistic in all of its industries.

> Firstly - and somewhat controversially - the authors assert that low levels of competition lead to low levels of innovation (and hence lower levels of economic growth). This is controversial because Silicon Valley produces companies with very little competition (Google for example) that are clearly innovative

and they have eaten alive older companies that forgot how to innovate.

> Tepper and Hearn have written an angry book. It is angry at the regulators that have allowed non-competitive mergers to happen. It is angry at politicians and lobbyists in the pocket of supernormally profitable corporations.

What's wrong with an angry book? Those examples are things worth getting angry about.

> They endorse measures against tech companies that stop them leveraging monopolies on one sector into monopolies in another sector. They would have endorsed the break-up of Microsoft into an operating system company and an applications company.

Wouldn't have been the end of the world. Imagine if MS had split. Parts of it would have failed. But office on Linux would probably be a thing.

I don't agree with this writer's take on the AA incident.

Any airline has a right to ask you to exit their plane, just like a taxi driver can ask you to leave his taxi. They owe you a refund, and maybe compensation, but they don't OWE you transportation.

If you were getting into a taxi, and the driver (for some reason) determined that s/he couldn't take you to your destination, they have every right to ask you to exit the vehicle.

Other than some kind of life-threatening emergency, there is no scenario I can imagine where you could be in the right by refusing to exit the vehicle and insisting they take you anyway. If you did refuse, force-able removal is the logical next step.

Writer went on to suggest that racism was somehow involved, which is where I gave up on reading the article.

You miss the point. To make your analogy right imagine there is must be single taxi company operating in your area and it decides not to take your order anymore because they don't make much profit from your trip. You need to wait several hours until their queue clears out and then you have to pray not to be outbid by someone else.

Of course the company decides what orders to take but you have to ask yourself why your government allows this kind of monopolies. After all capitalism promised to fix the worst flaws of commusims(i.e lack of competition/choices).

I'm pretty sure lack of consumer choice was not the worst flaw of communism.

'After all capitalism promised ..'.

Nope, capitalism does not promise anything. It is not a political system as the same as communism.

Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. https://en.wikipedia.org/wiki/Capitalism

Capitalism is definitely not like communism. However, people who push for it are promising things and argue by what we all gain by having capitalism. Not just that, they use past economic successes of capitalism and past economic failures as argument why we should keep things as capitalist as possible. They also argue by some moral values and so did communist proponents.

Capitalism has political component and is dependent on laws and its enforcement. It is also ideology. None of it makes it bad thing inherently, the past economic successes of capitalism are real, through we really should learn from cases where it cause trouble, so that we keep our capitalism not going to excess.

The promoters of capitalism do most definitely promise that. And what is your position on the issue?

> The promoters of capitalism do most definitely promise that.

No, they don't. That's just a poorly made up strawman.

At best what capitalism proponents defend is that it provides a system where products and services are provides efficiently to the public due to a combination of free enterprise, private ownership of the means of production, and competition.

And a large part of their argument is that this all works vastly better than socialism.

In germany the taxi driver cannot actually ask you to leave.

They have a transport duty (Beförderungspflicht, PBefG) by law unless 1) you can't pay or they would have to drive longer than allowed by law, 2) they can't transport you to the destination in a taxi or 3) some higher cause prevents transport (snow storm, traffic jam, etc.).

To my knowledge, airlines do fall under that and a german airline cannot legally kick you out of a flight unless any of the conditions above are met.

> Writer went on to suggest that racism was somehow involved

That's a crude misreading of the actual claim:

> They apologised after ... the realistic threat to ban United Airlines from China because of the racial undertones underlying that incident.

It was about image. Police officers dragging a bloody and seemingly unconscious man of minority ethnicity has extremely clear racial undertones, regardless of whether the intentions of the officers or airline staff were actually racist.

not OP, but my reading of the term "racial undertones" is that there is racism just under the surface, ie covert rather than overt racism.

As I understand, it was AA's fault that they had to eject the passenger because of over-booking, often practiced so that they can minimize the loss if someone doesn't show up. Clearly consumer rights need to be improved so this practice ceases. It's another case of a company that needs to be forced to do the right thing.

an airliner is not the same as a taxi. One is mass transport.

The writer didn't suggest racism was involved. They suggested China was upset about it and that would cost UA money.

> Health insurance is consolidated to the point where in most states there is only one or two realistic choices

This. I'd love to see more work on smashing monopolies in the health industry than I would on working out ways to fund them.

The synthesis of the indigo color wiped out an entire monopoly. Before the German chemist Adolf von Baeyer the market relied heavily upon the import of natural indigo from India whom basically got wiped off the market in one season. In yet another David vs. Goliath display of how the balancing of the market works in action a monopoly fell. Simultaneously a new market got born; namely the blue (indigo) jeans market. If you ever doubt that the market can handle the advent of monopolies - look no further than the pants you’re wearing!

Very long lasting monopolies are rare but price fixing between few largest players is a common occurence.

We used to say that monopolies were wrong and bad for capitalism.

Now we're saying that monopolies are ok?

Well, Adam Smith certainly thought they were bad and he is probably most correct about that as well. But they aren't the end of the free market as some people want to have you believe!

Not to mention that it's free markets that provides the incentive that is needed to come up with ideas and innovation that can break monopolies!

IMO, Laizzes-Faire capitalism is the sort that, as of today, favors the larger players over the smaller fish in the sea.

Practically, that system is going to become worse than ever.

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