Comments (9)

• Paul Marks

  Quite so. The basic principles on which government "anti trust" or "competition" policy is based are false.

  If a sole provider of a good or service "exploits its position" by big price hikes or reductions of service (not caused by any change in supply or demand), then competitors will emerge. They need not be small enterprises growing up - they could be big enterprises seeing a chance to go into a new market.

  There is no "correct" price or level of service that government can measure or enforce, the only "just" price or level of service is the one agreed between buyer and seller engaged in civil (i.e. nonviolent) interaction. And the only evil monopoly is one based on the threat of violence (i.e. a government or private criminal organization saying "compete with us and we will attack you").

  It was a great merit of the late Murry Rothbard (a man I am not shy of attacking on other matters) to show all of the above perhaps better than any other scholar. He also pointed out that many of the scholastic thinkers of the Middle Ages (who had been assumed to hold that a "just" price was a price of such-and-such determined by an outside observe) in fact held that the only "just" price was a free price.

  Published: May 14, 2007 9:56 AM

• George Edwards

  Why do you insist on imposing your values on everyone? We all don't agree that life is better than death,happiness better then misery, and wealth better than poverty. What if want death for the parasitical humankind.

  P.S. I know this is really how some people talk so I better include this "im just kidding" clause.

  Published: May 14, 2007 11:16 AM

• Jonathan Bostwick

  But its, of course, important to note that government granted monopolies really are pure evil.

  Socialists actually once believed that stopping "wasteful" competition would usher in an era of unmatched prosperity.

  Published: May 14, 2007 12:14 PM

• Matthew Robare

  Can you imagine trying to call cross-country if AT&T had never had a monopoly?

  Remember the Gospel of Wealth.

  Published: May 14, 2007 3:31 PM

• Larry Ruane

  This article also shows that the scope of competition for consumer spending is much broader than most people (especially most mainstream economists) understand. Saying that the "monopolist" wants to grow the market for ice sports recognizes that people can spend their money on many other sports activities (cycling, a health club membership, etc.) -- or even on a new HDTV to watch the NBA playoffs on -- if ice sports gets too expensive. Excellent article.

  Published: May 14, 2007 8:20 PM

• Vanmind

  Curling rules. It's like chess for beer-hounds.

  Published: May 14, 2007 10:59 PM

• Todd Whitesel

  You just made the mistake of going after an easy target and claiming it proves the general case. Your skating monopolist is easy to boycott if he exploits his position, but a vital utility like electricity is very different.

  Californians who lived through the crass market manipulation of Enron would take issue with your idea that monopolists can be trusted merely because not all of them are crooked. You can count me among them: in 2001 I had to devise evacuation plans in the event of a rolling blackout at a hotel function in Los Angeles.

  The idea that pure free markets can magically protect themselves from fraud and corruption is just as laughable as the idea that central planners know what's best for you, or that government bureaucrats are inherently fair and impartial.

  As always, some sort of balance is required. Since Enron, California has done quite well with regulated utilities, taxing consumption to fund conservation and cleaner sources. In California we now pay less per capita than most other states even though rates are higher, because we no longer waste as much.

  Meanwhile, much of America is being encouraged to waste cheap energy by privatized utilities who have a rational incentive to promote waste because it is profitable.

  Published: May 15, 2007 2:44 AM

• JSH

  Oh please. The Enron fiasco was a result of state involvement in the energy market, not due to the free market. The answer to failed partial privatization is complete privatization, not complete monopoly.

  Published: May 16, 2007 2:11 PM

• Juan

  Todd Whitesel : "The idea that pure free markets can magically protect themselves from fraud and corruption is just as laughable as the idea that central planners know what's best for you, or that government bureaucrats are inherently fair and impartial.
  "

  You sound confused...

  If you realize that bureaucrats are not fair, then why should you support them ?

  If central planning is no good, why support it ?

  Perhaps bureaucrats should be accountable to 'the people' ? But what's the point ? You put a crook in charge, and then have to waste resources to make sure that the crook does not act according to his nature ? Isn't that a contradiction ? an inneficient proposition ?

  "Since Enron, California has done quite well with regulated utilities, taxing consumption to fund conservation and cleaner sources. "
  Excuse me ? What right do you have to decide what other people do with their lives ? Why should people be forced to spend their money according to your green whims ?
  Cleaner sources need subsidies. Because they are inneficient. That is, they are wasteful.
  "In California we now pay less per capita than most other states even though rates are higher"
  If rates are higher, then you pay more than other people do. That should be self-evident.
  "because we no longer waste as much."
  You pay high rates and you have access to less energy. Your standard of living has been reduced by the bureaucrats you don't support ? or do you ?
  "Meanwhile, much of America is being encouraged to waste cheap energy "
  Sorry, if it's cheap, then it's not being wasted.

  Published: May 16, 2007 8:33 PM