11 ms·

Across the West powerful firms are becoming even more powerful

329 points by ilamont 8y ago

SubiculumCode 8y ago
Relatedly in NY Times: "Be Afraid of Economic ‘Bigness.’ Be Very Afraid. In the 1930s it contributed to the rise of fascism." https://www.nytimes.com/2018/11/10/opinion/sunday/fascism-economy-monopoly.html https://www.nytimes.com/2018/11/10/opinion/sunday/fascism-ec...
- dredmorbius 8y ago
  Fascinating, thanks. No idea why the negative reception. Previously: https://news.ycombinator.com/item?id=18429409 https://news.ycombinator.com/item?id=18429409
amelius 8y ago
The problem with the free market is really language. Humans tend to converge to a small number of words for everything. It's Google for search, iPhone for phones, and Coke for cola. If we solve this language problem, then we can hope to solve the problems caused by monopolistic behavior.
- btown 8y ago
  It's an intriguing idea that language might cause humans to be biased towards exploiting knowledge about common brands rather than exploring new ones. Do we derive utility from having a thinner "tail" on our (shared societal) vocabulary? Unfortunately, the distinction between "brand" and "corporation" makes this point, while interesting, somewhat moot. Consider that the Koch brothers have been able to consolidate brands ranging from TIME to Sports Illustrated, from Brawny towels to Dixie cups. In a world where users desire a "long tail" of brands, corporations continue to consolidate but simply invest in a wider variety of brand names and marketing for them. There's still synergy to be gained from a consolidated entity operating all of those brands. And so we're right back where we started.
  - eiaoa 8y ago
    > In a world where users desire a "long tail" of brands, corporations continue to consolidate but simply invest in a wider variety of brand names and marketing for them. There's still synergy to be gained from a consolidated entity operating all of those brands. And so we're right back where we started. Exactly. An example: Whirlpool owns many major appliance brands (e.g. Maytag and Amana). They can afford to make ever crappier products, because they know when a customer is unsatisfied, they'll more than likely buy another Whirlpool under a different brand name. https://recraigslist.com/2015/10/they-used-to-last-50-years/ https://recraigslist.com/2015/10/they-used-to-last-50-years/
- pjc50 8y ago
  The Sapir-Whorf-Coke hypothesis?
- icebraining 8y ago
  If it's iPhone for phones, why are they far from being a monopoly? That theory seems suspect even with your examples.
- notfromhere 8y ago
  Or you can just prevent companies from having too much market share within an industry, which we've enforced before and worked pretty well. Removing the consumer price standard for anti-trust enforcement would go a long way to preventing these huge oligopolies from forming
  - njarboe 8y ago
    If a company grows organically to have a large market share due to superior product, service, or even luck, don't break them up. But I would say having a dozen serious competitors in a market really prevents a lot of problems. Don't let companies buy each other when it would put the combined company over 10% of the market. Of course this rule can be immediately gamed in many ways but might be able to be done in some decently reasonable way.
    - basicplus2 8y ago
      Even further.. only allow humans to own shares in companys or units in trusts.. this would help prevent things being hidden or manipulated.
      - breatheoften 8y ago
        This seems like an interesting idea — a very complex constraint but easily said...
      - ksdale 8y ago
        Technically humans do own everything. The problem is not being able to find out who owns what because at some point in the chain, there's an entity outside the country or somewhere that has different disclosure rules.
- wpietri 8y ago
  There is not one of those without a giant marketing budget and a powerful corporation behind it. Further, you're confusing market monopolization with specific terms sometimes becoming generic. You could look at Xerox as a counterexample: the term became generic for "photocopy", but that doesn't mean they're dominant like Google. Xerox has something like 17% market share for copiers; they're third place in a robust market.
- fredley 8y ago
  The purpose of Newspeak was not only to provide a medium of expression for the world-view and mental habits proper to the devotees of Ingsoc, but to make all other modes of thought impossible. Its vocabulary was so constructed as to give exact and often very subtle expression to every meaning that a Party member could properly wish to express, while excluding all other meaning and also the possibility of arriving at them by indirect methods. This was done partly by the invention of new words, but chiefly by eliminating undesirable words and stripping such words as remained of unorthodox meanings, and so far as possible of all secondary meaning whatever.
  - PavlovsCat 8y ago
    > The net effect of this language system was not to keep these people ignorant of what they were doing, but to prevent them from equating it with their old, "normal" knowledge of murder and lies. Eichmann's great susceptibility to catch words and stock phrases, combined with his incapacity for ordinary speech, made him, of course, an ideal subject for "language rules." -- Hannah Arendt, "Eichmann in Jerusalem: A Report on the Banality of Evil" > When daily life requires turning a blind eye to the falsity of countless things we’re told, it weakens the power of language to sort truth from fiction. -- Oliver Burkeman > The basic tool for the manipulation of reality is the manipulation of words. If you can control the meaning of words, you can control the people who must use the words. -- Philip K. Dick > The great enemy of clear language is insincerity. When there is a gap between one’s real and one’s declared aims, one turns as it were instinctively to long words and exhausted idioms, like a cuttlefish spurting out ink. -- George Orwell > All issues are political issues, and politics itself is a mass of lies, evasions, folly, hatred, and schizophrenia. When the general atmosphere is bad, language must suffer. [..] But if thought corrupts language, language can also corrupt thought. -- George Orwell
- antidesitter 8y ago
  > The problem with the free market is really language... If we solve this language problem, then we can hope to solve the problems caused by monopolistic behavior. Do you have evidence for any of this?
vannevar 8y ago
We need significant, international corporate reform well beyond just tax policy, or Western liberal democracy will be lost as corporate 'citizens' completely dominate the human ones.
- bilbo0s 8y ago
  Good luck getting everyone to cooperate. Think about it, how much did different cities cooperated when trying to get Amazon's HQ2? That said, you could at least narrow the problem by getting just the US, the EU, and China to cooperate. (But even that strikes me as a Sisyphean task. But what do I know?)
  - atq2119 8y ago
    It would be rational for cities and states to lobby for the federal government to introduce legislation which makes the kind of tax breaks that corporations are angling for illegal. Note: it is rational for them to simultaneously compete for corporate investment by offering individual tax breaks and lobby for such tax breaks to be made illegal at the federal level. This is rather hard to explain to many even otherwise intelligent people, but it's one of the most important lessons that game theory has to offer. The EU was acting somewhat in this direction when it forced Ireland to collect taxes from corporations.
    - bilbo0s 8y ago
      I know it's rational game theoretically. The question is would they ever do this? Likely not. Why not? Because of the conflicting political ambitions involved on the part of key decision makers. That's why my idea would be to create laws that make these deals null and void until they are put to a popular vote in the State or City or tax paying entity that will bear the burden of the costs.
    - icebraining 8y ago
      I don't think it's hard to explain: it's the cities' equivalent to cartelization. It's no wonder why two competing firms would like to prevent each other from lowering prices, and they often lobby for laws to do that. The mechanism here is the same.
CoolGuySteve 8y ago
This is also a national security risk. A nation state interested in war will have an easier time shutting down a small handful of things simultaneously to quickly cripple our economy. For example: - Shutting down only Visa and Mastercard would disable the vast majority of credit cards. - Disabling debit cards or withdrawing funds from JP, BofA, Wells Fargo, and Citi would disable the majority of banking clients in the US. - About 40% of US air travel could be stopped by hacking American and Southwest. We've already seen similar large scale attacks on large companies: - In the 90s and early 2000s, Microsoft's weak security allowed worms to cripple Microsoft Office and Windows. - 100 million JP Morgan accounts were compromised by 3 people in 2015.
- bilbo0s 8y ago
  I'm not disagreeing with you, but the military side of me can't help but see how all of those things would be beneficial for our government as well. Stopping US air travel in an emergency. Stopping electronic transactions in a financial emergency. Etc etc etc. I think a lot of government types would see many potential benefits in the way things are set up now. Even most regular people would have to, grudgingly, admit that, if it were necessary, this system could deliver the government unprecedented amounts of control. I mean, for good or for bad. But yeah, there's likely a double edged sword there. No question.
  - phoe-krk 8y ago
    There are very few cases where stopping a firm from functioning would be beneficial, as compared to it being destructive. Most of the time, we want flights, banking, credit cards, IT systems to function rather than go black; hackers have many more chances and time to disrupt all of these than a government will ever have occasions to consider halting a particular company's operations in the name of national security.
  - wbl 8y ago
    Remember 9/11? Shutting down airspace in an emergency is easish: tell everyone to land.
  - wpietri 8y ago
alienreborn 8y ago
> “Competition is for losers,” writes Peter Thiel, an American venture capitalist, in his book, “Zero to One”. Monopoly is the goal, he says. Wow!
- PavlovsCat 8y ago
  Whenever I hear stuff like that, I wonder what their parents were like, or where else that need for external validation comes from. Even having to be the best is for "losers" IMO, but cheating to overpower people better than you, that's some hardcore stunted development on bold display.
  - Kaveren 8y ago
    > "Even having to be the best is for "losers" IMO" This makes no sense. Being extremely competitive and taking personal pride in being the best makes you a loser? By what logic?
    - PavlovsCat 8y ago
      I didn't say "being extremely competitive and taking personal pride in being the best", I said "having to be the best". If you ignore all that, including "cheating to overpower people better than you", of course it makes no sense, but that's of your own making. If you want me to elaborate on something that you asked, and nothing something I made up, then ask me about something I said, not something you made up.
      - Kaveren 8y ago
        As I see it, "having" to be the best would be synonymous with being extremely competitive and placing a large amount personal pride in that. It's why I was asking why you felt that way. You separated it from cheating to overpower people, as if strong desire to be the best is a bad thing.
        PavlovsCat 8y ago
xoa 8y ago
Note this is the intro piece to a series of articles in an Economist "Special Report" which they do from time to time on various topics. They talk about tech more specifically in the "The tech antitrust paradox". However, while this not just a simple attack piece at all, and the Economist to its credit tries to consider various defenses and complexities as well, I think they miss a couple of really big ones by failing to really get down to some of the fundamental foundations tech is built on. The first issue is simple: fantastically enormous capital expenditures. The basic story here is simple and repeated, the early and medium stages of a new industry's development inevitably harvest all the low hanging fruit in terms of pure physics and math. There is no path dependency yet either. But as it matures the cost of incremental gains begins increasing non-linearly. In tech we see this most particularly in semiconductor fabrication, where the costs of the cutting edge processes that have powered everything we do have been on a J-curve for each new node. An article by by SemiEng "Big Trouble At 3nm" [1] earlier this year had a good graph from IBS show the trend in design costs alone. In terms of the fab themselves IBS estimated "3nm will cost $4 billion to $5 billion in process development, and the fab cost for 40,000 wafers per month will be $15 billion to $20 billion", and it wouldn't be surprising if that was optimistic. "7nm" (TSMC, ~Intel 10nm) has been hard and multi-billion expensive also. Economically the only way to make this work is by trying to amortize towards the thankfully very low raw material cost through enormous volume, and players must be able to front fantastic sums with very long time horizons. How does this square with tons of tiny firms? Vertical integration could be gone after so it's a pure foundry model, but that still leaves just a couple of foundries in control there. That's chips alone though, lots of other areas of electronics have the property of low resource cost combined with utterly enormous capex requirements, such as state of the art displays. Improvements in energy storage also require plants like the Gigafactory. The results are super, super important in my opinion, it's absolutely in our overall interest to keep pushing forward computation (not just silicon but whatever else becomes possible like optical computing), to reduce the price and improve the performance of energy storage technology, better human/system interfaces (retinal scanning displays next perhaps?), more reliable better memory, and on and on. We're far from "done" here. Yet this naturally takes not just long time scale dirt moving but also R&D, inevitably including some blue-sky. And blue-sky R&D in the context of tech brings us right back to government vs corps too. In principle one way to try to allow smaller firms again would be to offload a lot of this back onto government instead, which by definition has a long time horizon and shouldn't be as worried about individual short term ROI or any single area vs the long term health of the state as a whole. It can make the results of research available to all. But government R&D has not been keeping up there. Monopolies can act in effect as a pseudo-government in many ways financially, and in fact a lot of the scary parts of them can also potentially give them an escape from typical quarter-to-quarter thinking. Some of the key foundations of our current tech trace right back to places like Bell Labs and Xerox PARC, R&D outfits that performed long term research which their parents often didn't even profit from, but were themselves backed in part by the massive economic power of their parent corps. And no discussion of this would be complete without getting back to one area the government directly plays in monopolies: intellectual property. Maximalism there long since got out of control. The Economist piece doesn't give this the right level of attention IMO, particular wrt tech where rather then merely having (overlong incorrectly implemented) copyright and trademark, there are "software patents" and "business method patents" that don't just cover an implementation but basic mathematics and fundamental ideas themselves. This is a big practical part of the "moats" they talk about in their conclusion, and the difficulty small firms have in competing because that would depend on interoperability. The capex part is just really hard, and I didn't even touch on things like the space exploration SpaceX (and hopefully Blue Origin soon) has started to revolutionize after decades of doldrums. It's one thing to talk grandly about "splitting up the bad guys" and such, but asking the public to pony up tens of billions to take their place might be different (if it can't be disguised another way, like military spending maybe). And that's even assuming it'd work and government could do the job there, which it might not. R&D is more promising and the open research initiatives gaining steam now are an important part of that, but also unfortunately doesn't seem a slam dunk or very safe from politicians looking for easy things to cut and attack. "What is this even any good for anyway huh?" etc. IP is promising if only because it's purely within the power of government itself in principle, it's a creation of government in the first place anyway. Making copyright function with software like it does all previous media (source escrow for non-open/available), reducing its term to levels that reflect how modern electronic distribution has reduced costs and increased audiences along with desired churn, eliminating software and business method patents entirely, carving out far more powerful interoperability exceptions, requirements that at the least technical protection measures cannot be stacked with legal protections (or must be very term limited), would all go a long way towards increasing dynamism there. So would legal changes to cut down the EULA tape, and not just for buyers either. Producers should also be fully protected from liability by default without any contract, and contracts reserved for sufficient sophisticated entities in bespoke arrangements that wish to affirmatively bargain standard rights. It'd be good if popular anger here could be channeled towards some real positive changes, but I do fear that between lack of public or political understanding and powerful entrenched interests it will instead be channeled unproductively at best or into a real baby-and-bathwater situation at worst. To some extent big corps have even perversely taken a role defending some of our interests from governments in a way individuals cannot, would we be able to oppose intelligence agencies efforts to backdoor crypto as well as Apple for example? Of course conversely big companies have often been directly complicit and key to government authoritarian impulses and intel gathering too. It's really hard to figure out where to start, though I think IP at least is a relatively easy pickings place. ---- 1: https://semiengineering.com/big-trouble-at-3nm/ https://semiengineering.com/big-trouble-at-3nm/
andrepd 8y ago
I always see this as fundamentally a matter of weakening of democracy. In my personal view, democracy is the principle that each person must have a say in decisions that affect them. In other words, any given power must be shared among the people that it affects. Now as more and more "power" goes into the hands of corporations, less and less power is in the hands of the (supposedly "democratic") governments, which themselves are imperfect democracies. And make no mistake: corporations control, and have power over, vast and chunks of our lives. Crucially, that power is fundamentally held in a nondemocratic way: not subject to any scrutiny or control by the part of the people that it affects. For me, this is one of the most critical flaws of capitalism, the fact that privately held power and democracy are fundamentally incompatible, and that the more power corporations hold, the less democratic is our control over our lives: the less free we are.
- dv_dt 8y ago
  The Dig podcast just posted a fascinating discussion of the roots of neoliberalism talking about the binding of nations in favor of nameless market structures. There is a discussion of Hayek seeing a ideal of people making independent decisions, but essentially bound by market constraints in a way that makes the system operate smoothly. I don't think there was the anticipation of the rollup of large corporate entities in this kind of vision - at least not to the scale that they start pulling on the fabric of the system leading to instability. https://www.blubrry.com/thedig/39413662/a-history-of-neoliberalism-with-quinn-slobodian/ https://www.blubrry.com/thedig/39413662/a-history-of-neolibe...
chiefalchemist 8y ago
> "The firms involved in the journey made profits of $151bn and had a median return on capital of 29% last year. An equally weighted basket of their shares—call it the monopoly money portfolio—beat global stockmarkets by 484% over the past decade. Collectively, 17% of the companies’ shares are owned by just three investment mega-managers, BlackRock, Vanguard and State Street." If these were a nation-state they would rank in the Top 10, yes? Top 20 at the least? With money comes power. With power the drive to maintain that power. Where there is anti-West sentiment, these outfits should be very concerned. As should the rest of us, as it is the rest of who will fight their battles / wars, if history repeats itself.
deleted 8y ago
[deleted]
CryptoPunk 8y ago
Replacing one supergiant with a small cartel of giants doesn't make a major difference in the balance of power. What's needed is actual decentralization, where consensus occurs without a trusted third party.
ilaksh 8y ago
I feel that we should at least mention decentralized technologies in this discussion. Please consider how systems like cryptocurrency, smart contracts, types of content-oriented networking, etc. may enable open platforms that can be an alternative to the monopoly companies'.
- fabianhjr 8y ago
  Don't stop there, there is a push for Decentralized Planned Economies. ( https://www.wikiwand.com/en/Decentralized_planning_(economics) https://www.wikiwand.com/en/Decentralized_planning_(economic... )
  - anoncake 8y ago
    That's just an empty page, you probably meant https://en.wikipedia.org/wiki/Decentralized_planning_%28economics%29 https://en.wikipedia.org/wiki/Decentralized_planning_%28econ...
- tomp 8y ago
  Cryptocurrencies are wasteful and “smart contracts” are neither smart nor contracts. I’m all for decentralisation, but IMO git helps more than all of crypto.
deytempo 8y ago
In other news, green grass gets greener, at least in Michigan
tempodox 8y ago
So the rich are getting richer and the powerful more powerful. Unfettered capitalism is working as it's supposed to be. What else is new?

329 points by ilamont 8y ago

Relatedly in NY Times: "Be Afraid of Economic ‘Bigness.’ Be Very Afraid. In the 1930s it contributed to the rise of fascism." https://www.nytimes.com/2018/11/10/opinion/sunday/fascism-economy-monopoly.html https://www.nytimes.com/2018/11/10/opinion/sunday/fascism-ec...

dredmorbius 8y ago
Fascinating, thanks. No idea why the negative reception. Previously: https://news.ycombinator.com/item?id=18429409 https://news.ycombinator.com/item?id=18429409

amelius 8y ago

The problem with the free market is really language. Humans tend to converge to a small number of words for everything. It's Google for search, iPhone for phones, and Coke for cola. If we solve this language problem, then we can hope to solve the problems caused by monopolistic behavior.

btown 8y ago
It's an intriguing idea that language might cause humans to be biased towards exploiting knowledge about common brands rather than exploring new ones. Do we derive utility from having a thinner "tail" on our (shared societal) vocabulary? Unfortunately, the distinction between "brand" and "corporation" makes this point, while interesting, somewhat moot. Consider that the Koch brothers have been able to consolidate brands ranging from TIME to Sports Illustrated, from Brawny towels to Dixie cups. In a world where users desire a "long tail" of brands, corporations continue to consolidate but simply invest in a wider variety of brand names and marketing for them. There's still synergy to be gained from a consolidated entity operating all of those brands. And so we're right back where we started.
- eiaoa 8y ago
  > In a world where users desire a "long tail" of brands, corporations continue to consolidate but simply invest in a wider variety of brand names and marketing for them. There's still synergy to be gained from a consolidated entity operating all of those brands. And so we're right back where we started. Exactly. An example: Whirlpool owns many major appliance brands (e.g. Maytag and Amana). They can afford to make ever crappier products, because they know when a customer is unsatisfied, they'll more than likely buy another Whirlpool under a different brand name. https://recraigslist.com/2015/10/they-used-to-last-50-years/ https://recraigslist.com/2015/10/they-used-to-last-50-years/
pjc50 8y ago
The Sapir-Whorf-Coke hypothesis?
icebraining 8y ago
If it's iPhone for phones, why are they far from being a monopoly? That theory seems suspect even with your examples.
notfromhere 8y ago
Or you can just prevent companies from having too much market share within an industry, which we've enforced before and worked pretty well. Removing the consumer price standard for anti-trust enforcement would go a long way to preventing these huge oligopolies from forming
- njarboe 8y ago
  If a company grows organically to have a large market share due to superior product, service, or even luck, don't break them up. But I would say having a dozen serious competitors in a market really prevents a lot of problems. Don't let companies buy each other when it would put the combined company over 10% of the market. Of course this rule can be immediately gamed in many ways but might be able to be done in some decently reasonable way.
  - basicplus2 8y ago
    Even further.. only allow humans to own shares in companys or units in trusts.. this would help prevent things being hidden or manipulated.
    - breatheoften 8y ago
      This seems like an interesting idea — a very complex constraint but easily said...
    - ksdale 8y ago
      Technically humans do own everything. The problem is not being able to find out who owns what because at some point in the chain, there's an entity outside the country or somewhere that has different disclosure rules.
wpietri 8y ago
There is not one of those without a giant marketing budget and a powerful corporation behind it. Further, you're confusing market monopolization with specific terms sometimes becoming generic. You could look at Xerox as a counterexample: the term became generic for "photocopy", but that doesn't mean they're dominant like Google. Xerox has something like 17% market share for copiers; they're third place in a robust market.
fredley 8y ago
The purpose of Newspeak was not only to provide a medium of expression for the world-view and mental habits proper to the devotees of Ingsoc, but to make all other modes of thought impossible. Its vocabulary was so constructed as to give exact and often very subtle expression to every meaning that a Party member could properly wish to express, while excluding all other meaning and also the possibility of arriving at them by indirect methods. This was done partly by the invention of new words, but chiefly by eliminating undesirable words and stripping such words as remained of unorthodox meanings, and so far as possible of all secondary meaning whatever.
- PavlovsCat 8y ago
  > The net effect of this language system was not to keep these people ignorant of what they were doing, but to prevent them from equating it with their old, "normal" knowledge of murder and lies. Eichmann's great susceptibility to catch words and stock phrases, combined with his incapacity for ordinary speech, made him, of course, an ideal subject for "language rules." -- Hannah Arendt, "Eichmann in Jerusalem: A Report on the Banality of Evil" > When daily life requires turning a blind eye to the falsity of countless things we’re told, it weakens the power of language to sort truth from fiction. -- Oliver Burkeman > The basic tool for the manipulation of reality is the manipulation of words. If you can control the meaning of words, you can control the people who must use the words. -- Philip K. Dick > The great enemy of clear language is insincerity. When there is a gap between one’s real and one’s declared aims, one turns as it were instinctively to long words and exhausted idioms, like a cuttlefish spurting out ink. -- George Orwell > All issues are political issues, and politics itself is a mass of lies, evasions, folly, hatred, and schizophrenia. When the general atmosphere is bad, language must suffer. [..] But if thought corrupts language, language can also corrupt thought. -- George Orwell
antidesitter 8y ago
> The problem with the free market is really language... If we solve this language problem, then we can hope to solve the problems caused by monopolistic behavior. Do you have evidence for any of this?

vannevar 8y ago

We need significant, international corporate reform well beyond just tax policy, or Western liberal democracy will be lost as corporate 'citizens' completely dominate the human ones.

bilbo0s 8y ago
Good luck getting everyone to cooperate. Think about it, how much did different cities cooperated when trying to get Amazon's HQ2? That said, you could at least narrow the problem by getting just the US, the EU, and China to cooperate. (But even that strikes me as a Sisyphean task. But what do I know?)
- atq2119 8y ago
  It would be rational for cities and states to lobby for the federal government to introduce legislation which makes the kind of tax breaks that corporations are angling for illegal. Note: it is rational for them to simultaneously compete for corporate investment by offering individual tax breaks and lobby for such tax breaks to be made illegal at the federal level. This is rather hard to explain to many even otherwise intelligent people, but it's one of the most important lessons that game theory has to offer. The EU was acting somewhat in this direction when it forced Ireland to collect taxes from corporations.
  - bilbo0s 8y ago
    I know it's rational game theoretically. The question is would they ever do this? Likely not. Why not? Because of the conflicting political ambitions involved on the part of key decision makers. That's why my idea would be to create laws that make these deals null and void until they are put to a popular vote in the State or City or tax paying entity that will bear the burden of the costs.
  - icebraining 8y ago
    I don't think it's hard to explain: it's the cities' equivalent to cartelization. It's no wonder why two competing firms would like to prevent each other from lowering prices, and they often lobby for laws to do that. The mechanism here is the same.

CoolGuySteve 8y ago

This is also a national security risk. A nation state interested in war will have an easier time shutting down a small handful of things simultaneously to quickly cripple our economy. For example: - Shutting down only Visa and Mastercard would disable the vast majority of credit cards. - Disabling debit cards or withdrawing funds from JP, BofA, Wells Fargo, and Citi would disable the majority of banking clients in the US. - About 40% of US air travel could be stopped by hacking American and Southwest. We've already seen similar large scale attacks on large companies: - In the 90s and early 2000s, Microsoft's weak security allowed worms to cripple Microsoft Office and Windows. - 100 million JP Morgan accounts were compromised by 3 people in 2015.

bilbo0s 8y ago
I'm not disagreeing with you, but the military side of me can't help but see how all of those things would be beneficial for our government as well. Stopping US air travel in an emergency. Stopping electronic transactions in a financial emergency. Etc etc etc. I think a lot of government types would see many potential benefits in the way things are set up now. Even most regular people would have to, grudgingly, admit that, if it were necessary, this system could deliver the government unprecedented amounts of control. I mean, for good or for bad. But yeah, there's likely a double edged sword there. No question.
- phoe-krk 8y ago
  There are very few cases where stopping a firm from functioning would be beneficial, as compared to it being destructive. Most of the time, we want flights, banking, credit cards, IT systems to function rather than go black; hackers have many more chances and time to disrupt all of these than a government will ever have occasions to consider halting a particular company's operations in the name of national security.
- wbl 8y ago
  Remember 9/11? Shutting down airspace in an emergency is easish: tell everyone to land.
- wpietri 8y ago

alienreborn 8y ago

> “Competition is for losers,” writes Peter Thiel, an American venture capitalist, in his book, “Zero to One”. Monopoly is the goal, he says. Wow!

PavlovsCat 8y ago
Whenever I hear stuff like that, I wonder what their parents were like, or where else that need for external validation comes from. Even having to be the best is for "losers" IMO, but cheating to overpower people better than you, that's some hardcore stunted development on bold display.
- Kaveren 8y ago
  > "Even having to be the best is for "losers" IMO" This makes no sense. Being extremely competitive and taking personal pride in being the best makes you a loser? By what logic?
  - PavlovsCat 8y ago
    I didn't say "being extremely competitive and taking personal pride in being the best", I said "having to be the best". If you ignore all that, including "cheating to overpower people better than you", of course it makes no sense, but that's of your own making. If you want me to elaborate on something that you asked, and nothing something I made up, then ask me about something I said, not something you made up.
    - Kaveren 8y ago
      As I see it, "having" to be the best would be synonymous with being extremely competitive and placing a large amount personal pride in that. It's why I was asking why you felt that way. You separated it from cheating to overpower people, as if strong desire to be the best is a bad thing.
      - PavlovsCat 8y ago

xoa 8y ago

Note this is the intro piece to a series of articles in an Economist "Special Report" which they do from time to time on various topics. They talk about tech more specifically in the "The tech antitrust paradox". However, while this not just a simple attack piece at all, and the Economist to its credit tries to consider various defenses and complexities as well, I think they miss a couple of really big ones by failing to really get down to some of the fundamental foundations tech is built on. The first issue is simple: fantastically enormous capital expenditures. The basic story here is simple and repeated, the early and medium stages of a new industry's development inevitably harvest all the low hanging fruit in terms of pure physics and math. There is no path dependency yet either. But as it matures the cost of incremental gains begins increasing non-linearly. In tech we see this most particularly in semiconductor fabrication, where the costs of the cutting edge processes that have powered everything we do have been on a J-curve for each new node. An article by by SemiEng "Big Trouble At 3nm" [1] earlier this year had a good graph from IBS show the trend in design costs alone. In terms of the fab themselves IBS estimated "3nm will cost $4 billion to $5 billion in process development, and the fab cost for 40,000 wafers per month will be $15 billion to $20 billion", and it wouldn't be surprising if that was optimistic. "7nm" (TSMC, ~Intel 10nm) has been hard and multi-billion expensive also. Economically the only way to make this work is by trying to amortize towards the thankfully very low raw material cost through enormous volume, and players must be able to front fantastic sums with very long time horizons. How does this square with tons of tiny firms? Vertical integration could be gone after so it's a pure foundry model, but that still leaves just a couple of foundries in control there. That's chips alone though, lots of other areas of electronics have the property of low resource cost combined with utterly enormous capex requirements, such as state of the art displays. Improvements in energy storage also require plants like the Gigafactory. The results are super, super important in my opinion, it's absolutely in our overall interest to keep pushing forward computation (not just silicon but whatever else becomes possible like optical computing), to reduce the price and improve the performance of energy storage technology, better human/system interfaces (retinal scanning displays next perhaps?), more reliable better memory, and on and on. We're far from "done" here. Yet this naturally takes not just long time scale dirt moving but also R&D, inevitably including some blue-sky. And blue-sky R&D in the context of tech brings us right back to government vs corps too. In principle one way to try to allow smaller firms again would be to offload a lot of this back onto government instead, which by definition has a long time horizon and shouldn't be as worried about individual short term ROI or any single area vs the long term health of the state as a whole. It can make the results of research available to all. But government R&D has not been keeping up there. Monopolies can act in effect as a pseudo-government in many ways financially, and in fact a lot of the scary parts of them can also potentially give them an escape from typical quarter-to-quarter thinking. Some of the key foundations of our current tech trace right back to places like Bell Labs and Xerox PARC, R&D outfits that performed long term research which their parents often didn't even profit from, but were themselves backed in part by the massive economic power of their parent corps. And no discussion of this would be complete without getting back to one area the government directly plays in monopolies: intellectual property. Maximalism there long since got out of control. The Economist piece doesn't give this the right level of attention IMO, particular wrt tech where rather then merely having (overlong incorrectly implemented) copyright and trademark, there are "software patents" and "business method patents" that don't just cover an implementation but basic mathematics and fundamental ideas themselves. This is a big practical part of the "moats" they talk about in their conclusion, and the difficulty small firms have in competing because that would depend on interoperability. The capex part is just really hard, and I didn't even touch on things like the space exploration SpaceX (and hopefully Blue Origin soon) has started to revolutionize after decades of doldrums. It's one thing to talk grandly about "splitting up the bad guys" and such, but asking the public to pony up tens of billions to take their place might be different (if it can't be disguised another way, like military spending maybe). And that's even assuming it'd work and government could do the job there, which it might not. R&D is more promising and the open research initiatives gaining steam now are an important part of that, but also unfortunately doesn't seem a slam dunk or very safe from politicians looking for easy things to cut and attack. "What is this even any good for anyway huh?" etc. IP is promising if only because it's purely within the power of government itself in principle, it's a creation of government in the first place anyway. Making copyright function with software like it does all previous media (source escrow for non-open/available), reducing its term to levels that reflect how modern electronic distribution has reduced costs and increased audiences along with desired churn, eliminating software and business method patents entirely, carving out far more powerful interoperability exceptions, requirements that at the least technical protection measures cannot be stacked with legal protections (or must be very term limited), would all go a long way towards increasing dynamism there. So would legal changes to cut down the EULA tape, and not just for buyers either. Producers should also be fully protected from liability by default without any contract, and contracts reserved for sufficient sophisticated entities in bespoke arrangements that wish to affirmatively bargain standard rights. It'd be good if popular anger here could be channeled towards some real positive changes, but I do fear that between lack of public or political understanding and powerful entrenched interests it will instead be channeled unproductively at best or into a real baby-and-bathwater situation at worst. To some extent big corps have even perversely taken a role defending some of our interests from governments in a way individuals cannot, would we be able to oppose intelligence agencies efforts to backdoor crypto as well as Apple for example? Of course conversely big companies have often been directly complicit and key to government authoritarian impulses and intel gathering too. It's really hard to figure out where to start, though I think IP at least is a relatively easy pickings place. ---- 1: https://semiengineering.com/big-trouble-at-3nm/ https://semiengineering.com/big-trouble-at-3nm/

andrepd 8y ago

I always see this as fundamentally a matter of weakening of democracy. In my personal view, democracy is the principle that each person must have a say in decisions that affect them. In other words, any given power must be shared among the people that it affects. Now as more and more "power" goes into the hands of corporations, less and less power is in the hands of the (supposedly "democratic") governments, which themselves are imperfect democracies. And make no mistake: corporations control, and have power over, vast and chunks of our lives. Crucially, that power is fundamentally held in a nondemocratic way: not subject to any scrutiny or control by the part of the people that it affects. For me, this is one of the most critical flaws of capitalism, the fact that privately held power and democracy are fundamentally incompatible, and that the more power corporations hold, the less democratic is our control over our lives: the less free we are.

dv_dt 8y ago
The Dig podcast just posted a fascinating discussion of the roots of neoliberalism talking about the binding of nations in favor of nameless market structures. There is a discussion of Hayek seeing a ideal of people making independent decisions, but essentially bound by market constraints in a way that makes the system operate smoothly. I don't think there was the anticipation of the rollup of large corporate entities in this kind of vision - at least not to the scale that they start pulling on the fabric of the system leading to instability. https://www.blubrry.com/thedig/39413662/a-history-of-neoliberalism-with-quinn-slobodian/ https://www.blubrry.com/thedig/39413662/a-history-of-neolibe...

chiefalchemist 8y ago

> "The firms involved in the journey made profits of $151bn and had a median return on capital of 29% last year. An equally weighted basket of their shares—call it the monopoly money portfolio—beat global stockmarkets by 484% over the past decade. Collectively, 17% of the companies’ shares are owned by just three investment mega-managers, BlackRock, Vanguard and State Street." If these were a nation-state they would rank in the Top 10, yes? Top 20 at the least? With money comes power. With power the drive to maintain that power. Where there is anti-West sentiment, these outfits should be very concerned. As should the rest of us, as it is the rest of who will fight their battles / wars, if history repeats itself.

deleted 8y ago

[deleted]

CryptoPunk 8y ago

Replacing one supergiant with a small cartel of giants doesn't make a major difference in the balance of power. What's needed is actual decentralization, where consensus occurs without a trusted third party.

ilaksh 8y ago

I feel that we should at least mention decentralized technologies in this discussion. Please consider how systems like cryptocurrency, smart contracts, types of content-oriented networking, etc. may enable open platforms that can be an alternative to the monopoly companies'.

fabianhjr 8y ago
Don't stop there, there is a push for Decentralized Planned Economies. ( https://www.wikiwand.com/en/Decentralized_planning_(economics) https://www.wikiwand.com/en/Decentralized_planning_(economic... )
- anoncake 8y ago
  That's just an empty page, you probably meant https://en.wikipedia.org/wiki/Decentralized_planning_%28economics%29 https://en.wikipedia.org/wiki/Decentralized_planning_%28econ...
tomp 8y ago
Cryptocurrencies are wasteful and “smart contracts” are neither smart nor contracts. I’m all for decentralisation, but IMO git helps more than all of crypto.

deytempo 8y ago

In other news, green grass gets greener, at least in Michigan

tempodox 8y ago

So the rich are getting richer and the powerful more powerful. Unfettered capitalism is working as it's supposed to be. What else is new?