Issue: Economic: Corporations; free market / monopolies

[sickmint79]

my friend mentioned how corporating are mostly cutthroat bastards and would work to massacre eachother and create monopolies. what is ron paul's take on something like this?

[0zzy]

A lot of monopolies are due to governmental involvement. Other monopolies, not sure. :)

[Darren McFillintheBlank]

..

[Matt Collins]

Yes, real monopolies are usually very rare and short lived. Many are the result of the government (telcos, cable-cos, utility companies, etc).

And a natural monopoly in and of itself isn't a bad thing. However when a monopoly begins to use its monopolistic status to act in a predatorial manner, or utilize anticompetitive tactics, then it beings to become detrimental to the free market.

[ThePieSwindler]

http://www.mises.org/journals/rae/pdf/rae9_2_3.pdf

[Capitalism]

As Ayn Rand pointed out, those opposed to the free market will say:
When a company's prices are too low, it's called predatory pricing.
When a company's prices are too high, it's monopolistic pricing.
And when a company's prices are the same as other companies, it's colluision.

[sickmint79]

http://www.mises.org/journals/rae/pdf/rae9_2_3.pdf

> Interesting article...but i think many historians would disagree with his
> argument that there have never been monopolies......Standard Oil, US
> Steel, the latest being Microsoft.....perhaps these "natural monopolies"
> are rare today due to government regulations already in place not lack
> thereof. the article seems to be saying that natural monopolies have
> never occurred in a free market. However, examples conflict this and more
> so, how could we really test this since modern states never really have
> total "free markets" --there is always some regulation. This historical
> examples of monopolies (things like the Dutch and English Mercantile
> Trading Companies of the 1600's) occurred during the absence of
> governmental regulation.

any response to this? i am out of my league on this topic.

[nexalacer]

Heh, the Dutch East Indies company and mercantile companies are by definition government interference that led to monopoly. They were the only companies given authority by their governments to provide their goods and services.

And Microsoft is not a true monopoly as proven by the abundance of other competing products that are offered and used. I think the Microsoft attacks are based on something else, though I'm not sure exactly what it is. I hate Microsoft simply because their products suck so bad yet Bill Gates still gets rich off of it! That screams government interference to me!

And from what I understand, Standard Oil and US Steel were helped out through government in more ways than one. I could be wrong here, but I seem to remember something about the government hand in these companies when I read Zinn's A People's History of the United States.

[AlexK]

Completely uncontrolled free market doesn't work. Well, it does work, but not for the consumer.

[Goldwater Conservative]

A lot of monopolies are due to governmental involvement. Other monopolies, not sure. :)

Yeah, for example, a lot of local governments give Comcast monopoly rights in exchange for free services.

[user]

:(

It's like Whac-A-Mole, every time we respond to an argument from someone who doesn't understand economics, another one pops up.

[AlexK]

:(

It's like Whac-A-Mole, every time we respond to an argument from someone who doesn't understand economics, another one pops up.


I don't see you responding to any argument in this thread.

[user]

I don't see you responding to any argument in this thread.
That's because I was referring to other threads.

[AlexK]

Ok, well how about you answer the question in this thread. You're an economics expert, right?

[user]

Ok, well how about you answer the question in this thread. You're an economics expert, right?
http://www.ronpaulforums.com/showthread.php?t=53298

[AlexK]

ah, thanks

[Fox McCloud]

in a truly free market, monopolies collapse very quickly...either that, or they're forced to lower their prices.

the sad thing is, we haven't had a truly free market since the late 1800's; therefore, it's hard for strong proponents of the free market to say "it works!" (it really does), because the government has done such a good job of destroying it and distorting its image.

there would still be regulations in a free market economy, but they were be safety regulations (ie: no arsenic in drinks, that sort of thing that are incredibly obvious)....but these would be enforced by the court and independent groups, not the EPA or other government departments.

it's a really complex issue that's hard to explain to a lot of people....some will get it, others won't...and still others will be closed to the idea, but once you prove that what we have isn't a free market, they suddenly change their mind.

ultimately, the key to a free market lies first, and foremost with a sound monetary system (gold standard), and secondly, it lies with no government interventionism....the rest? It'll take care of itself.