1985: “IBM is going to dominate the entire world!”. 1995: IBM is fading fast.
1995: “Microsoft is going to own the entire world!” 2005: Microsoft has settled into a niche.
2005: “WalMart is going to destroy small business!”. 2016: WalMart seems to be hitting limits.
As little as the left seems to trust the market, it seems to be keeping “monopolies” pretty well under control.
Who could have foreseen it?
(Answer: every single free market conservative).
Um, NO.
I’d suggest you might do well to look at the stats on how these monopolies have restricted both growth and innovation.
Stiglitz has written a good book on the topic, the Pride of Inequality.
Free markets are a load of crap; they don’t work — and the examples you provided do not exist in them.
1935: A&P grocery stores will destroy the nation due to their monopoly. (true story, FDR thought A&P was pure evil due to their success).
Tell me DG how did those 5 year planned economies of the USSR and Mao’s China do?
It’s worth noting that it’s arguable that Microsoft was created by antitrust action against IBM, and that the history of antitrust action with IBM probably hampered the DOJ when investigating Microsoft’s Windows monopoly with regards to OS2.
And yes, DG, free markets don’t work, which is why the degree of market freedom correlates incredibly well with prosperity. What we really need is state control over every facet of a company’s operation like they have in paradises like North Korea and Cuba.
And if we didn’t have the Sherman act, Cub Foods would completely eliminate Target, Walmart, …..honestly, DG, you can’t even get a bite to eat without finding out that you’re full of DC. Can you wake up someday?
That’s right, DoggieDoo, Microsoft destroyed Apple.
Actually, jpa, Microsoft saved Apple with a nice cash infusion at a critical time for Apple. Although that was clearly meant as a way of sparing MS having to deal with another antitrust action.
I’ve been through IBM’s antitrust action, and I have to say that it’s no fun. The amount of paperwork we were required to keep was insane and it really slowed IBM’s workings down. Internally, most folks attributed IBM getting off to the DoJ being so overwhelmed by their order to forward all documents having anything to do with computers to them that they couldn’t find what they needed to get IBM convicted. We simply buried them deeper in paper than they could dig themselves out of.
The real key to destroying monopolies is to allow things to change faster than internal bureaucracies can keep up. If you wind up with the government slowing down innovation through over-regulating a market, then that market will stagnate and a monopoly can develop (see early 20th century oil). For example, MS isn’t a dominant threat simply because technology folks saw how they behaved in computers and when the Next Big Thing came around (smartphones), they froze them out rather than be crushed by MS, and MS couldn’t respond fast enough to outmaneuver them at the critical early stages because of internal sclerosis.
2006: The money center banks are too big.
2016: The money center banks are too big.
If only we had a free market in money.
In a matter of speaking, we do have a free market in money. How many of us keep our resources predominantly in monetary instruments (cash, bank accounts, money market, CDs, etc..) vs. how many of us keep our assets in real estate, stocks, and bonds? We all know the Fed and other banks are working to reduce the value of the dollar, hence we keep our resources in productive assets instead of depreciating ones.
Doggy, as a left wing moon bat that always believes that Keynesian economics will work, you are the last person that should even be thinking about free markets. Like the idiots that you elect and prostrate yourself for, you are economically illiterate.
Kept Woman: “Free markets are a load of crap”. Would be interesting to see how DG’s husband/keeper makes a living.
Most businesses fail to understand that the creative destruction of capitalism has to occur not only in the market but also in their own business. When I was in business school, a professor remarked that a business should stop doing ten percent of it’s worst-performing/least productive activities each year whether they be people, product lines, franchises, etc. and focus resources on the best performing/most productive activities. Someone piped up – “what do you think we should be, cannibals?” At the same time “Neutron” Jack Welch (so called because he was like a Neutron bomb – destroy the people, save the buildings) was becoming the “greatest manager of all time” by cashiering numerous activities at his company General Electric and investing the proceeds back into the businesses that had a strong future. Most of his contemporaries at the time rejected this and no longer exist today (try calling Westinghouse).
nerd, sorry for not using ( sarcasm ) tag.
For giggles, visit “Penigma” and take a look at her treatment of the case of Track Palin. She is actually arguing, as are others on the left, that the testimony of one or two of his barracks-mates disproves the notion that he suffered PTSD. So in the minds of the left, barracks-mates were not competent to figure out that John Kerry’s wounds were not significant, but Track Palin’s mental condition while in the services can be completely sussed out by his comrades in arms.
It just boggles the mind.
Microsoft, if it IS a monopoly, found out through hard experience that no one gets to own the ocean until you pay off the sharks.
You will learn more about economics by reading Adam Smith, Bastiat, and Keynes than by reading any modern economist, no matter how well credentialed. This is especially true if all you read of modern economists is reviews of their books in partisan publications (looking at you, DG).
Marx is a waste of time — he was a political philosopher, not an economist (for example, Marx believed that the Old World grew wealthy by looting the gold of the New World civilizations, not the higher rate of marginal return on exploiting previously unexploited New World resources — a laughable mistake).
All modern economists on the left are basically commenting on and modifying Keynes’ idea of state-governed macroeconomics. Keynes was a genius. Stiglitz and Krugman are not geniuses. They are political hacks who hold academic positions.
Any person or corporation who holds intellectual property rights is a monopolist.
This is a descriptive, not a pejorative term.
A monopoly doesn’t mean that you can charge whatever you want for your product. Well, technically, you can, but it wouldn’t be an efficient use of capital to charge a billion dollars for a copy of Win 10. You wouldn’t sell it.
The competition monopolists face are substitute goods. What limits the price that you, the monopolist, can charge is that price where people choose to buy a substitute for your product, or go without it for some other reason.
I’d suggest you might do well to look at the stats on…
Bla bla bla.
I could look into it. But inevitably, you’ll be wrong, and I’ll be bored.
Who the hell cares?
In DGs centrally planned shoppers utopia Walmart would be nationalized and renamed as the Main Universal Store (Glávnyj Universáĺnyj Magazín) and its management would be replaced by the management from the Post Office and all those Dollar General/Dollar Tree stores that are, in free market fashion, currently eating Walmart’s lunch would be shuttered.
kel, actually, “G’ stood (still stands?) for Gossudarstvennyj, as in (belonging to) Government. So it fits DG narrative even better!
Mitch,
First, your timeline and quotes are absurd. No one said IBM was going to own the world in 1985. Apple was in ascendency (the Macintosh was making inroads into the PC world, especially in schools), and there were massive competitors in the intel based chip market which, obviously, succeeded in carving up the IBM pie.
Second, no one said in 1995 that Microsoft would “own the world”, but they DID say they were likely to dominate. Which they did, and which they have, for nearly 20 years.
Last, people said in 1990 that Walmart would destroy main street in small town USA. They did, do you dispute that? Do you want me to find you some numbers?
More on point, let’s talk about big banks. The big banks owned something like 76% of ALL US deposits prior to the financial crisis, a crisis they helped to foster by pressing the Clinton and Bush Administrations (and Congress) for repeal of the interstate banking act and Glass Stegal, by pressing the Bush Administration for a change to the classification of “conforming loans” for Fannie Mae under the auspice of increasing home ownership and then encouraging Americans to spend and fund it from their equity. They then also helped to create issues by bundling these loans into mortgage backed securities (MBS’) which, as you may have heard, weren’t really very good investments.
When the market collapsed, a collapse everyone knew had to happen, came along, rather than pay the price, because we could not let banks like Citi or Wachovia simply evaporate, the assets of those banks were acquired by those same big, risk generating banks. The consequence was that now those top banks hold, iirc, more than 82% of ALL US deposits. There are more than 3000 banks in the US, but the top 10 hold 82%. In short, their influence in government lead to them increasing share.
This course of concentration is partly healthy, economies of scale work, it’s what explains Social Securities operational efficiency. But it is also bad when large companies can protect themselves from scrutiny, from protection, or from social pressure to pay a fair wage (all of which have been true since the advent of “small government” conservatives – I put it in quotes because of course debt has exploded under “conservative” Presidents.)
Now, let’s talk about ACTUAL economics. Large trade debts are unsustainable. The move to offshore jobs has been to move production offshore. This has helped foster very large trade debts because MOSTLY those nations cannot buy our own products (they do buy our services but still there is a large disparity). This differential results in asset bubbles, like real estate (which was the catalyst of BOTH the S&L collapse and the collapse in 2008) and in stocks because there is inflation in assets but not prices. Then, some hit to confidence, or the economy (and then confidence) comes along, and you have collapse in assets (stocks and real estate). That’s basic macro-economic theory.
Last thing on macro-theory for you here, spending in economic booms, meaning cutting taxes and increasing the money supply, is exactly the WRONG medicine. It helps foster inflation and more, it’s not needed. I’ll be happy to refer you to a textbook on this if you like since you seem to want to claim all “free market conservatives” which I assume includes you, support this basic understanding because I will tell you, classic and Keynesian (and hybrid) economists “all” do, because it’s as basic as the periodic table is to chemists. The issue is, Mitch, it’s exactly what Reagan and W did wrong. They cut taxes and increased spending in economic growth all while we had a large and growing trade imbalance. Both things were the wrong medicine at the wrong time. They did little and less to address the causes of imbalance and simply allowed for the development of an asset bubble, a bubble which burst on their watch. ACTUAL economists recognize you don’t want sustained imbalance AND you don’t over concentrate wealth or stand by while monopolies are created. Actual free market people want competition, not strangulation of our government by lobbyists paid for by large companies, or classifying companies as people so that they can give unlimited amounts to political campaigns.
If you want to look at the impact of economic policy and “hands off” government, stop comparing Sanders to Mousolini and START comparing the US to Mexico. That’s where we’re heading. Or, simply, look at the US airline industry. Do we have MORE or fewer large carriers than we had in 1970? What percentage of the industry do the top 4 carriers own? Do they share fare data? Do any have essentially exclusive routes? Do we really have competition? ACTUAL economists recognize some limits are needed to prevent volatility and monopoly and our restrictions are being removed, not improved.
My goodness, MacBeth’s “tomorrow” soliloquy comes to mind when reading Penigma’s screeds here. Suffice it to say that yes, people were at one point very concerned about IBM ruling the tech world as late as 1982, when the antitrust action was dismissed as without merit, and having lived in a number of small towns, I can affirm that Wal-Mart has not totally destroyed small business in these towns. It’s different, but alive and well. Really, if Wal-Mart hadn’t come to these towns, it would have been Kmart, Target, or other discount stores. Those of us who wanted goods and services of higher quality than were provided by Walmart or Kmart (or Ben Franklin before that I guess) kept the other stores alive.
bike, Penny got tired of listening to crickets on his own blog so decided to get some action over here. Of course, the only action he can get here is spanking. Not that there is anything wrong with that, but does show the state of his of mental health and his thirst for attention, even if it is spanking.
Looking at Penigma’s last paragraph, one would think that competition in air travel ended in 1978, when Carter (ahem) signed the deregulation bill. However, a look at the list of defunct airlines actually shows not too many went bankrupt right afterwards, and there were a tremendous number of airlines that formed.
We would infer, along with sound economists (a.k.a. the kind Penigma won’t listen to), that the regulatory state actually sought to limit customer choice and raise prices–as anyone who remembers the cost of flying back in the 1970s would have told you.
https://en.wikipedia.org/wiki/List_of_defunct_airlines_of_the_United_States
” . . . stop comparing Sanders to Mousolini and START comparing the US to Mexico. That’s where we’re heading.”
No, Mexico is heading here.
10% of everyone born in Mexico now resides in the United States.
Holy shit what a moron.
JPA; my take is that he’s simply a classic schoolyard bully, much like POTUS and Donald Trump. He’ll come here for a drive-by comment, but not engage when people respond to his claims. In the same way, if you point out that his blog is spouting off nonsense, amazingly your comment doesn’t get published.