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Isnt competition in free markets healthy? Doesn’t it tend to benefit everybody over time as products and services improve? Why would State or municipal govern

by nugget 8y ago

Isnt competition in free markets healthy? Doesn’t it tend to benefit everybody over time as products and services improve? Why would State or municipal governance, as a service, be immune from this? A US Supreme Court Justice once called American States “laboratories of democracy” and I think that’s apt. Let citizens vote with their feet, so to speak. In practical terms, Google (or Amazon, etc.) wants tax breaks but also wants a desirable community to help recruit and retain talented employees. If a community so impoverishes itself via tax breaks that it can’t afford to remain desirable, then nobody wins. Abuse and wildly perverse incentives are of course possible, but absent those scenarios, there’s an equilibrium between private incentives and public investment that certainly exists.

xvector 8y ago
> Isnt competition in free markets healthy? Doesn’t it tend to benefit everybody over time as products and services improve? No? Hence the need for regulations. The free market and competition are not inherently good things. They can be very, very bad for your average citizen.
- nugget 8y ago
  I don’t think anyone is arguing for no regulation. I am supporting competition within a regulatory framework. Constitutional, consumer, environmental, and other similar protections are all critical. It’s a reality that there remain very different philosophies regarding local governance — taxation, public services, public-private partnerships, etc. and some appropriate level of competition seems to be the best way to test competing approaches and compare outcomes.
rtkwe 8y ago
That breaks down in a lot of ways like most markets because of the huge power imbalance both in information and raw economic power. Just look at what Foxconn did in Wisconsin, (and pretty much everywhere else it's ever made a deal) the companies can promise the moon knowing they'll never deliver on half of it but the huge promise puts a huge electoral pressure on the local politicians to make the deal and the company signs a deal with little to no teeth (again they can largely dictate the terms of the deal because there's no reason they have to go with any particular location). Then the problems caused by the huge loans or bonds issued to finance a deal exist on a longer time frame than the company usually cares about and if they get too bad they can just toss in a little more compensation or start the cycle all over again in a new city. Google doesn't particularly care about how bad the local community gets there's enough single/childless couples in the work force to provide the minimal local employees a data center will need and when a particular employee's lifestyle changes they can just be move internally and replaced. And if it gets bad enough it's simple enough to build another datacenter.

by nugget 8y ago

xvector 8y ago

> Isnt competition in free markets healthy? Doesn’t it tend to benefit everybody over time as products and services improve? No? Hence the need for regulations. The free market and competition are not inherently good things. They can be very, very bad for your average citizen.

nugget 8y ago
I don’t think anyone is arguing for no regulation. I am supporting competition within a regulatory framework. Constitutional, consumer, environmental, and other similar protections are all critical. It’s a reality that there remain very different philosophies regarding local governance — taxation, public services, public-private partnerships, etc. and some appropriate level of competition seems to be the best way to test competing approaches and compare outcomes.

rtkwe 8y ago

That breaks down in a lot of ways like most markets because of the huge power imbalance both in information and raw economic power. Just look at what Foxconn did in Wisconsin, (and pretty much everywhere else it's ever made a deal) the companies can promise the moon knowing they'll never deliver on half of it but the huge promise puts a huge electoral pressure on the local politicians to make the deal and the company signs a deal with little to no teeth (again they can largely dictate the terms of the deal because there's no reason they have to go with any particular location). Then the problems caused by the huge loans or bonds issued to finance a deal exist on a longer time frame than the company usually cares about and if they get too bad they can just toss in a little more compensation or start the cycle all over again in a new city. Google doesn't particularly care about how bad the local community gets there's enough single/childless couples in the work force to provide the minimal local employees a data center will need and when a particular employee's lifestyle changes they can just be move internally and replaced. And if it gets bad enough it's simple enough to build another datacenter.