Comment by klabb3 | Hacker News Reader

Comment by klabb3 | Hacker News Reader

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Apple was doing malicious compliance all along. It’s not surprising. But this is extremely good news, because it dampens FUD and narratives such as ”the EU is only going after American companies with frivolous rules”. If you get punished this hard for anti-trust, in the US, you are so out of line it’s not even funny. So it adds legitimacy to the free market spirit seen in markets like EU, which has been criticized for making up arbitrary rules for self-interest.

In either case, this thing will die with a whimper, not a bang. Apple will have to concede to EU and it would not surprise me if other large markets will demand the same.

So the stage is changing. Apple could have flown under the radar and made concessions with terms they could dictate, letting them simplify their offerings across the world without attracting regulators and mega-lawsuits (and hear me out - maybe focus on products and innovation instead). Now, they fight against multiple jurisdictions at once, which all have different requirements (obviously, since they are different bodies). Even if they fold now, by reducing the tax and making more lenient rules, they’re too late. They already have regulators and judges dictating for them what to do, so their agency is permanently limited.

People forget that in the EU, the ”gatekeeper status” wasn’t just ”go after Apple and Google”. It was the App Store specifically. For instance, Gmail was evaluated but not included.

TLDR Apple has to sleep in a bed that they shat in themselves. They were universally popular and could get away with lots of questionable behavior, but instead angered everyone and are rightfully getting curfewed.

> So it adds legitimacy to the free market spirit seen in markets like EU, which has been criticized for making up arbitrary rules for self-interest.

I'm confused a) who is taking the concept of free markets seriously, especially in this context where markets (and competition) are arbitrarily defined and owned by corporations and and b) who would view self-interested laws as either surprising or bad? Of course laws are in self interest. Why on else else would you pass a law?

This is HN, the Church of the Free Market is well represented. If you haven't yet seen someone give the "free markets create competition" speech on Monday and the "my company aims to capture this space and then entrench a monopoly with economies of scale / network effects / platform effects / two sided markets / last mile dynamics" pitch on Tuesday, just hang around HN a bit more. You won't have to wait long.

I had thought the clear need for anti-trust had tickled down to the plebs on here. Unfortunate to see that people still casually refer to free markets as if it's a meaningful concept.

If you really truly think that regulation is dragging down some market, it's easy to talk about in specific terms. It is only possible to employ "free markets" in bad faith.

Endstate of the game theory of free markets is cartel or Monopoly.

All it takes is a single competitor to gradually gain more and more strength and competitive advantage via dumping, regulatory capture, or other means (see: organized crime and syndicates) to win the death struggle.

What has saved us hasn't been some magical free market, it has been the markets themselves, once they achieve trust status, fundamentally undermined by science and technology creating a new market that upends the old one.

I highly recommend reading Schumpeter, both "Business Cycles" and "Capitalism, Socialism and Democracy".

He discusses how motivations fundamentally change after profit margins peak and argues that profit after this point necessarily produces less economically efficient processes (in terms of the flow of demanded goods and services, not the shareholder, who does receive further productivity gains). In this context, undesired market advantage (legal or illegal) is just a symptom of profit, but it can be analyzed like any other sort of inefficiency. The core prescription is to nationalize the process or otherwise remove the profit motive around peak profit (which is, to be clear, not always easy or possible to identify... but in the worst case, this would open further opportunity for private capital to invest in the next generation of improvements).

He also discusses how failed investment cycles can resonate into market crashes faster than capital can rationally reallocate. Both of these above observations seem very very relevant to our current situation in the US today, and should cause everyone to look askance at people who aren't concerned about how healthy our political economy actually is.

> fundamentally undermined by science and technology creating a new market that upends the old one.

The kicker here is that there's no reason to expect either to continue yielding the same rewards. Some industries have projectable, plannable, investable growth patterns; others do not. Almost all the industries with predictable growth rely on consumption driven by yields from the lucrative exploitation of frontiers, mostly technological recently as you point out. I suspect that the market is going to get incredibly volatile as capital sees this frontiers dry up and adjusts expectations. ideally by cannibalizing itself and not eating us, but it might need a little help in that regard....

Yes, but temporarily embarrassed millionaires abound. They eagerly employ the concept of "free markets" in bad faith, propelled by the hope that the corruption can be made to work for them rather than against them. Some of them are right, most are wrong, but they are propelled to spread the faith just the same.

Beneath them, people tend to get good at programming before they get good at spotting exploitation, so there is always a stratum of True Believers to feed the operation. Individually they wise up and graduate, but the stratum remains as it is fed from the bottom by the proverbial sucker born every minute.

Then we have the top of the pyramid which actually does benefit from it all. They are small in number but they have enough money to fund the whole space (more importantly: enough money to have a reason to fund the whole space) so they have outsize influence. They could decide to ban me for saying this, for example.

A monopoly isn't a free market though, because, well, the market is not free. This ruling is precisely about making the market of payment processing on iOS more free, creating such a market.

Sure, we can say that it isn't true communism -- err, sorry, market freedom -- so long as we acknowledge that the incentives which create, establish, and perpetuate the monopolies emerge due to market freedom and attempts to curtail monopolies are regularly attacked under the banner of market freedom and that actual market freedom requires (metaphorical) mace-wielding regulators to regularly go on (metaphorical) skull-cracking expeditions which will be fought tooth and nail by investors seeking the windfall profits that come from monopoly.

Do we agree? Or will we find ourselves on opposite sides of this fight the millisecond the specifics of this case fade from the public eye?

Yes, regulators must fight monopolies to maintain a free market, as the former are antithetical to the latter.

I think a more interesting question is: who is “self”? US is historically more prone to favor business, while EU seems more concerned in protecting consumers. And of course there is the noise generated by incompetence/corruption/lobbying that makes the question of “in the interest of whom are laws made?” very nuanced.

Very good points. I've been trying to figure out whose interest is in our "national interests" my entire life. It sure ain't protecting my interests or those of anyone I love that justifies a trillion dollar a year military.

I am pretty sure if the US decided to get rid of its military entirely, then it wouldnt be long before it was invaded by Russia or China and then the interests of the people you love would be severly impacted.

The world stage is no more a safe place than it has been for any other part of history.

Straw man. Nobody said anything about “getting rid of its military entirely.”

> then it wouldnt be long before it was invaded by Russia or China

I would be lying if I claimed I hadn't dreamed of being liberated by a foreign power with more cultural competence at governance (which excludes Russia, obviously, but they probably at least aren't worse), but realistically anything but a slow scale-down in military power would probably entail the bloodiest world (and civil) war in history. Maybe nukes, too.

But, there's a fork in the road. We can choose to scale down our military presence (and control of trade) today, and figure out how we actually want to exist in a global community outside of letting our corporations swing their dicks freely... Or we can blow trillions of dollars continuing to make fools of ourselves rampaging through other countries rather than building high speed rail before we lose our grip on hegemony anyway as a matter of pure economics.

Or, I suppose, we can just murder anyone who disagrees with us until we're just miserably exploiting each other inside of high walls armed with automated guns. Something tells me that's the option we're going to pick.

Or invaded by liberating Canadians. We can dream...

The trillion dollar military is Americas welfare system. You may be chronically confused why no politician dem/republican/liberal/conservative ever wants to cut funding for it, and toss it up as obvious collusion between mega-contractors and politicians.

Well it is. And it's willful. That trillion dollars is spent almost entirely on US made things by US workers. Only a small slice (still large in absolute terms) goes to those mega-contractors. The rest is the only thing that has kept any semblance of American manufacturing alive. The military buys everything (this isn't an exaggeration, you would be hard pressed to find something in your life that they don't buy in quantity) , and there are countless businesses that pay decent wages with benefits for low skilled workers in every state that are only still in existence because of military spending.

It also functions as an incubator, having special provisions for small businesses, especially those owned by marginalized people or located in especially impoverished areas. Basically "We need need coffee filters, so if you buy the equipment and higher the workers, we'll sign a contract to buy 2,000,000 packages a year from you. (And it's a kick-your-door-down felony if you try to backdoor foreign made filters)."

That's why it is never cut. It's a welfare plan that republicans agree too because it requires holding down a job to access. It comes with the side effects of keeping factories running and getting an overpowered military.

The US military is also an enormous and very successful jobs program.

Also there may be some foreign policy applications.

This is true, and it is disgusting.

And it was an explicit pact between US and European countries: you can have socialism and not much military (because who wants a huge German army??), while we will do our socialism via our military, which in turn will protect you.

But now our politicians are so dumb they don't realize that's what was agreed long ago, and think they can have one part of that deal and not the other.

> US is historically more prone to favor business, while EU seems more concerned in protecting consumers.

Well that's not that obvious... Sure EU is more than willing to protect consumers from foreign(American) megacorporation because the cost of doing that is very low.

Entrenched major local companies? Well stifling competition through excessive regulation and propping up to bit too fall semi-zombie corporations is not necessarily that great for consumers long-term.

Do you have examples of targeted protections against foreign companies? Everything that comes to mind to me applies to all companies local or foreign.

Hypothetical local companies? The type of major tech corporations that are effected by DMA and similar regulations simply do not exist in Europe.

Regulating and fining them is very cheap politically when there are no jobs that can be lost or lobbyists to disappoint.

> who is taking the concept of free markets seriously

The EU. Let me explain, because this was confusing:

In US political debate, free markets have become synonymous with ”let companies do what they want”. Today, most of US ”markets” are neither free, nor (arguably) even markets at all, such as Amazon or health insurance. It is a mix between feudal system and protection racket.

Just like ”freedom isn’t free” in terms of civil liberties, same goes (imo) for markets. If you want to optimize for ”freedom” of markets, that means a non-zero amount of regulating them. This is obvious both in theory and by opening your eyes and looking outside.

As far as how to regulate them, I believe the EU is doing a good job, especially in the face of novel technology and business topologies. Basically, allow everything that isn’t deliberately anti-competitive. Because, drumroll, competition is fundamental for markets to work, at all.

Sorry for the confusion. It’s hard to make points when words mean completely different things in different parts of the world.

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