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Comment by akdor1154 | Hacker News Reader

> Keeping prices low is a great thing.

To a first approximation, yes, but this also forces things like small farmers and retailers being unprofitable, and all the societal changes that come with that, and of course then the tendency for consolidation and the inherent risk of more monopolisation from that.

Free market is great when it's full and noisy and no-one is large enough to control or manipulate it, the aim should be to keep it in this state (because then keeping prices low falls out naturally without terrible second order effects)

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> ...this also forces things like small farmers and retailers being unprofitable...

Nobody is "forced" to be unprofitable. If a business is unprofitable it can shut down. You're putting half the no-win argument - when Amazon makes a big profit people complain they are too powerful. When they don't make a big profit, this is an argument that they've squeezed the supply chain too much. There is a tiny line here that is theoretically acceptable, and I doubt either side of the no-win argument agrees where it is.

And this isn't what is driving the consolidation, the monopolisation is probably being driven by credit. Big players get much sweeter deals when dipping into the pool of printed money. If credit was not the driving force then it'd be much less common to see big conglomerates and small nimble players would have an easier time. Like how in housing credit booms tends to put smaller buyers in a worse position because they only end up living in about the same house as they already would have managed anyway but they have to sign away more of their life to get it.

>>Nobody is "forced" to be unprofitable. If a business is unprofitable it can shut down.

Check out the state of chicken farming, where chicken producers corral farmers take on huge amounts of debt to grow bigger to meet their requirements, then squeeze them hard, to the point of bankruptcy. The only winning move is to not play, but that means not selling to the buyers who control the market so likely losing the family farm. It's become just a matter of whether you lose it this year, or after a few years of churning under the producer's debt load.

There are numerous ways that a large monopoly can abuse their position of power such that the only real choice for smaller players is to play along in a losing game.

I’ve said it before and I’ll say it again: Progressively increasing asset taxes are the way. Make it more expensive to control a lot of resources to counteract the natural monopoly effect that comes from controlling large amounts of resources.

Free markets also should allow winners and losers. Walmart wasn’t always big. It was a winner though.

You can have winners and losers and also quantify the non-capital externalities in order to account for them.

Isn't zero profit the point of a fully efficient economic model? Profits are excess money after costs by definition so in such a system you'd want profits to tend to zero.

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