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Lots of strange logic, but first: > Under the rules of capitalism, you aren't allowed to use your size to bully competitors out of the market. That is certain
by cortesoft 3y ago
Lots of strange logic, but first:
> Under the rules of capitalism, you aren't allowed to use your size to bully competitors out of the market.
That is certainly not a rule of capitalism; it might be an interpretation of antitrust, but that is not a rule of capitalism. Also, it isn’t how the US courts and regulators view antitrust at all. You can certainly use your size to bully competitors, you just can’t use your size in SPECIFIC ways (buying too many competitors, dumping, etc)
The article is correct in courts expecting to be shown harm to consumers in order to take antitrust enforcement action, but their argument as to how the companies are doing that makes no sense.
They say these startups subsidize their business at a loss, offering consumers cheaper goods than they normally could, then they sell the company to unsuspecting rubes who don’t realize they will never be able to raise prices and make money.
If this is true… there is no crime. As they pointed out, antitrust has been interpreted to be about harm to consumers, and as described, consumers are not harmed. They get cheap goods for a while, and the company never is able to force price hikes with monopoly power, so consumers are never harmed.
The article argues the harm is actually to investors, but investors are not the ones protected by antitrust laws. As long as the companies are not committing fraud or lying in their statements to the market, investors are on their own to decide if the company is worth investing in or not.
- JohnFen 3y ago> and as described, consumers are not harmed. Hard disagree here. The government has chosen to interpret "harm" in a very, very specific way. The reasoning is that if it causes prices to go down, then there is a benefit, not harm. But harm comes in all sorts of forms, and a lot of harm is done by companies even if their actions cause prices to fall. > The article argues the harm is actually to investors Investors do get harmed, but I think the larger harm is actually to ordinary people.
- cortesoft 3y agoYou left out the first part of my sentence: > As they pointed out, antitrust has been interpreted to be about harm to consumers, and as described, consumers are not harmed. I wasn’t trying to argue whether the court and government interpretation of harm is right or wrong, just that it IS the way it has been interpreted and is the current law of the land.
- JohnFen 3y agoAh, sorry about that. I thought you were arguing that the current political interpretation of this issue was good.