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> None of the above sound bad in themselves. Actually, all of them are bad in themselves. Government-granted monopolies reduce innovation and consumer surplus,

> None of the above sound bad in themselves. Actually, all of them are bad in themselves. Government-granted monopolies reduce innovation and consumer surplus, inhibit competition and stagnate an economy, leaving it weak and unable to compete internationally. > In many areas we could do with less competition, more tariffs, and more cultural protection and subsidies. No, we could not.

dv_dt 9y ago
Private sector markets can show all those negatives, and companies can compete not on inherent efficiency of capital operation, but on who can more cheaply acquire low waged employees. Especially today, we should not believe blindly that capitalism that will automatically be better for society. The question isn't which abstract model is better, the question is how we build some sort of conventions that work better than what is happening now.
- ucaetano 9y ago
  > The question isn't which abstract model is better, the question is how we build some sort of conventions that work better than what is happening now. Oh, sure, there's potential for improvement. But so far there hasn't been a model that works better, and every single time that government-protected monopolies were tried, they failed with disastrous results. Every single new model tried has failed miserably. But that also doesn't mean there aren't ways to improve the current model.
  - dv_dt 9y ago
    Chinese steel's gov't granted monopoly is apparently so efficient our private markets can't compete... a core support given there is long term capital investment horizons - which gov't monopolies can end up enabling. I'm not saying that always works out for the better, but there's something there in that if your viewpoint is long enough you can win in efficiency, be it steel in China, or Standard Oil in a largely unregulated industrial market.
    - Kalium 9y ago
      Chinese steel? It's an interesting definition of "efficient" that is used to describe a whole sector that is kept alive and overproducing only by virtue of burning through massive subsidies.
      - dv_dt 9y ago
        So here's a question. If there were a cheaper way for China the nation to acquire the steel it needed during it's expansion phase why did China decide to subsidize? Is there an total system cost that they're maximizing beyond the accounting for just the balance sheet of the steel companies?
        ucaetano 9y ago
        Yes, it's called dumping.
        dv_dt 9y ago
        Are VC funded ventures like Uber dumping into the Taxi industry?
        hueving 9y ago
        No, Uber says it's profitable in the US. Also, the two products aren't really interchangeable because the main reason I use Uber/Lyft is that they fix the scamming nature of cabs (lying about broken credit card reader, inefficient routes, etc).
coliveira 9y ago
> Government-granted monopolies reduce innovation and consumer surplus This has no basis on the real world. Many of the largest companies in the world are subsidized by the government, including in the US. For example, Boeing/Airbus is a de-facto duopoly, subsidized by taxpayers. The biggest problems of these companies is that they are owned by private individuals. Having them formed as coops solves a major issue. While not perfect, I don't see these coops as any worse than other companies.
- ucaetano 9y ago
  At no point you talked about monopolies. And it has plenty of evidence in the real world, just look at AT&T, cable companies, ISPs, mail carriers, etc. And look at monopoly pricing. > The biggest problems of these companies is that they are owned by private individuals. Having them formed as coops solves a major issue. No, it doesn't. Coops are also owned by shareholders, and with government protection, they are monopolies, extracting economic rents from consumers. And economic rents are always, always bad.
  - walshemj 9y ago
    So you think the stock market and 80% of the banking system is a bad thing by that definition. Where is your pension/ 401k invested pray?
    - ucaetano 9y ago
      You don't seem to understand the difference between economic profit and economic rent...
- hueving 9y ago
  Making those two companies employee-owned would do absolutely nothing to spur innovation. Changing who gets the profits doesn't change the fact that a lock on the market means the best strategy is to coast on your existing products.
coldtea 9y ago
>Actually, all of them are bad in themselves. Only if one believes in the free market ideology and have no other measure of what's valuable than monetary. And even then, it's a stretch. All the big economies (the US first and foremost) grew to what they are by using tons of subsidies, tariffs and so on. And even now they use non-economic advantages (diplomatic and military pressure for one) to maintain their status.

dv_dt 9y ago

Private sector markets can show all those negatives, and companies can compete not on inherent efficiency of capital operation, but on who can more cheaply acquire low waged employees. Especially today, we should not believe blindly that capitalism that will automatically be better for society. The question isn't which abstract model is better, the question is how we build some sort of conventions that work better than what is happening now.

ucaetano 9y ago
> The question isn't which abstract model is better, the question is how we build some sort of conventions that work better than what is happening now. Oh, sure, there's potential for improvement. But so far there hasn't been a model that works better, and every single time that government-protected monopolies were tried, they failed with disastrous results. Every single new model tried has failed miserably. But that also doesn't mean there aren't ways to improve the current model.
- dv_dt 9y ago
  Chinese steel's gov't granted monopoly is apparently so efficient our private markets can't compete... a core support given there is long term capital investment horizons - which gov't monopolies can end up enabling. I'm not saying that always works out for the better, but there's something there in that if your viewpoint is long enough you can win in efficiency, be it steel in China, or Standard Oil in a largely unregulated industrial market.
  - Kalium 9y ago
    Chinese steel? It's an interesting definition of "efficient" that is used to describe a whole sector that is kept alive and overproducing only by virtue of burning through massive subsidies.
    - dv_dt 9y ago
      So here's a question. If there were a cheaper way for China the nation to acquire the steel it needed during it's expansion phase why did China decide to subsidize? Is there an total system cost that they're maximizing beyond the accounting for just the balance sheet of the steel companies?
      - ucaetano 9y ago
        Yes, it's called dumping.
        dv_dt 9y ago
        Are VC funded ventures like Uber dumping into the Taxi industry?
        hueving 9y ago
        No, Uber says it's profitable in the US. Also, the two products aren't really interchangeable because the main reason I use Uber/Lyft is that they fix the scamming nature of cabs (lying about broken credit card reader, inefficient routes, etc).

coliveira 9y ago

> Government-granted monopolies reduce innovation and consumer surplus This has no basis on the real world. Many of the largest companies in the world are subsidized by the government, including in the US. For example, Boeing/Airbus is a de-facto duopoly, subsidized by taxpayers. The biggest problems of these companies is that they are owned by private individuals. Having them formed as coops solves a major issue. While not perfect, I don't see these coops as any worse than other companies.

ucaetano 9y ago
At no point you talked about monopolies. And it has plenty of evidence in the real world, just look at AT&T, cable companies, ISPs, mail carriers, etc. And look at monopoly pricing. > The biggest problems of these companies is that they are owned by private individuals. Having them formed as coops solves a major issue. No, it doesn't. Coops are also owned by shareholders, and with government protection, they are monopolies, extracting economic rents from consumers. And economic rents are always, always bad.
- walshemj 9y ago
  So you think the stock market and 80% of the banking system is a bad thing by that definition. Where is your pension/ 401k invested pray?
  - ucaetano 9y ago
    You don't seem to understand the difference between economic profit and economic rent...
hueving 9y ago
Making those two companies employee-owned would do absolutely nothing to spur innovation. Changing who gets the profits doesn't change the fact that a lock on the market means the best strategy is to coast on your existing products.

coldtea 9y ago

>Actually, all of them are bad in themselves. Only if one believes in the free market ideology and have no other measure of what's valuable than monetary. And even then, it's a stretch. All the big economies (the US first and foremost) grew to what they are by using tons of subsidies, tariffs and so on. And even now they use non-economic advantages (diplomatic and military pressure for one) to maintain their status.