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Want to rescue rural America? Bust monopolies

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Re: Want to rescue rural America? Bust monopolies

#161

Post by IIIIIIIIIIII »

VLM wrote: post #143
IIIIIIIIIIII wrote: post #35

Earlier quoted context omitted.

I can speak for a different market in a different country (but I also lived in the US for a decade): IT freelancing in Germany. I get paid well, but there is something really strange going on: I can't get my contracts directly. I always have to go through a company whose sole business it is to be an intermediate between the (large) company that wants to hire a freelancer and the freelancer. Note that those freelancer…

The human labor cost of processing a contract goes up at a more than linear rate with the size of the company. Meanwhile, "managing" contracts is almost as expensive as managing employees. At some point having an accounting dept manage 10K contracts is simply impossible. Its a labor and control fraud limitation not technological.

As I said, I think the focus for the points of this discussion is the effect. No doubt everybody acts logically, I didn't suggest that everybody in those companies just lost their mind. This goes long the same lines as "For evil to triumph, all that is required is for good men to respond rationally to incentives." (so here it is the loss of ever more "market" in the "market economy" that we get as an effect, and it's questionable we get it back in economies of scale, judging by the popularity of Dilbert cartoons).

Re: Want to rescue rural America? Bust monopolies

#162

Post by valuearb »

mrgreenfur wrote: post #44

Does anyone else think that nearly all huge companies exist due to monopolies or near-monopolies? MS has monopoly on desktops. Apple on cell phones and tablets. Facebook on social networking. Google on search. I think any market without at least 3-4 strong competitors will devolve into one dominant player who can milk more from the customer base.

How does MS have a monopoly on desktops? I have three desktops in my house, and no microsoft software running on any of them.

Markets don't devolve into "monopolies" very often. In Microsofts case, it had an operating system that provided massive economies of scale to customers. You could run it on any compatible PC and be guaranteed to be able run hundreds of leading applications. Most businesses are significantly more productive with 100% windows than 50% windows and 50% other platforms. The only reason Apple Mac OS is in corporate America is because of it's special advantages in specific uses. It's always been too expensive to equip everyone with a Mac, esp. your lowest paid order entry/support types.

Most markets don't grow economies of scale for their customers in that manner. The advantage of having all of your sales people drive Fords instead of a mix of cars is a minor one from a fleet purchase perspective. And the same advantage can be had with a fleet purchase agreement with virtually any competitor.

Re: Want to rescue rural America? Bust monopolies

#163

Post by stinkytaco »

valuearb wrote: post #153
stinkytaco wrote: post #101

Earlier quoted context omitted.

I don't find that a very enlightening point, but I will offer some real numbers. The widely cited 20 million is from the Congressional Budget Office, a non-partisan organization, not CNN, as you state [1]. And even if you chose to reject that, the number of health insurance policies purchased on exchanges in 2016 was 12.7 million and is expected to top 13 million this year, not an insignificant amount and not includi…

Obamacare made private medical insurance illegal, so millions of self employed lost coverage from that. The exchange policies have increased in cost so rapidly they are unaffordable for anyone not getting a massive subsidies. Many self employed are now without insurance because of that.

It's illegal? Or it doesn't meet the minimum qualifications for the tax benefit, because those are quite different.

https://www.healthcare.gov/private-plan-exceptions-outside-o...

As to costs, those vary widely by state. This recent article in the NYTimes was a fairly good overview of how policy decisions can affect the premiums: https://www.nytimes.com/2017/04/21/health/how-gop-in-2-state...

Re: Want to rescue rural America? Bust monopolies

#164

Post by jondubois »

Most 'monopolies' that exist today are artificial - This is because they are only monopolies to the extent that they are able to:

1. Keep buying up advertising to make sure that any potential competitor cannot afford eyeballs.

2. Keep hiring up as much technical talent as possible to make sure that any potential competitor doesn't get access to that talent in order to build a competing product.

3. Keep subsidising the cost of their own services (at a loss to themselves) in order to make the market non-viable for any potential competitor.

It's a scorched-earth approach. Any company that has the money can create an artificial monopoly for themselves by engaging in any of the three activities above.

However, those activities are increasingly expensive because they drive up advertising costs and engineer salaries.

If companies keep doing this, eventually, they'll make the market non-viable even for themselves.

Re: Want to rescue rural America? Bust monopolies

#165

Post by arrosenberg »

JackFr wrote: post #102
bko wrote: post #67

Earlier quoted context omitted.

> A market in which buyers are not free to choose better products is not a free market. Most businesses can choose better products (not sure about hospital industry). They can also choose to sign an agreement that makes a supplier relationship exclusive. For instance, a restaurant can sign an agreement to accept only Mastercard. Is this not a free market?

Yeah so the point is that if the only restaurant in the USA is Applebee's and they sign an exclusive agreement with Mastercard, they are extending their monopoly -- likely illegally in the US: "But exclusive dealing also can be anticompetitive in some circumstances. For example, exclusive dealing may allow one manufacturer, in effect, to monopolize efficient distribution services and thereby prevent its rivals from c…

It would be better if you just used the obvious historical precedent - Standard Oil integrated with rail services by negotiating discounts that provided an insurmountable barrier to entry for smaller competitive. It was restraining trade, and while prices may have benefited consumers in the short run, the lack of competition would have been a negative over the long run.

Re: Want to rescue rural America? Bust monopolies

#166

Post by Retric »

bko wrote: post #144
maxerickson wrote: post #70

Earlier quoted context omitted.

That's the argument being made. The buyer is better off staying with the single supplier. The argument is that this is a breakdown in markets and should be regulated (for instance by breaking the supplier apart).

If the buyer is better off, and presumably the consumer, who's worse off? The woman who wrote the article that can't compete? She can't force the hospital to go against its interest and purchase her product?

Everyone except the supplier is worse off. Remember, a 50% discount on 3x price increase is still a huge price increase.

Further it's all short vs long term pricing. In the short term a company will setup lower prices to kill of competitors, the when there is no competition they raise prices significantly to have a long term war chest. So, on a day to day basis they might be the cheapest option, but their average price over decades is more than their short lived competition.

Re: Want to rescue rural America? Bust monopolies

#167

Post by didibus »

JackFr wrote: post #92
skummetmaelk wrote: post #28

Earlier quoted context omitted.

That's the thing though, that is exactly what a late stage "free market" looks like. What you need is a heavily regulated market that prevents exactly this behaviour. People need to stop wishing for the "free" market. The term is abused by orators and manipulators who prey on peoples desire for a market which is free in the spirit of the word, and deliver to them a market which is technically "free" and horrible.

> What you need is a heavily regulated market that prevents exactly this behaviour. That seems like the opposite of a solution. For such a system to work one has to believe that that the regulatory apparatus is staffed with monks who are unaffected by the temptations of wealth, power and vanity that other humans are subject to and that 'regulatory capture' isn't a real thing. Further that the price mechanism as an in…

The same people you trust with regulating, you trust are going to regulate against regulations. There's going to be an arbiter no matter what. The way we make sure he's not corrupt is through democracy. By limiting his time in power, and having the people choose his replacement.

The problem with monopolies is that they begin to approach government like control over one or more dimensions of society, but we have no corruption control on them.

Re: Want to rescue rural America? Bust monopolies

#168

Post by whopa »

whopa wrote: post #159
burntsushi wrote: post #154

Earlier quoted context omitted.

Isn't it obvious that it's a matter of perspective? Ask two non-programmers the difference between Python and Haskell, and they'll say, "They look the same to me." Ask two programmers the difference between Python and Haskell, and it's a fair bet that they'd be able to list off a laundry list of differences. Both perspectives are actually right, and neither one is a "trope" as you put it. What you think of as meaning…

The differences between Python and Haskell only affect programmers and people who employ programmers. The difference between the two parties approach to health care affects everybody in the US. It's not simply a matter of perspective.

People who can't distinguish between the meaningful impact of the differences between the two parties approach to health care are not paying attention or willfully ignorant. Bringing out the trope perpetuates this. It's a real problem.

Re: Want to rescue rural America? Bust monopolies

#169

Post by pdkl95 »

mozumder wrote: post #60
jessaustin wrote: post #37

Earlier quoted context omitted.

Ds talk a better game, but they rarely walk that talk. Take just your first example. W's first year in office, he wanted to standardize "civil unions" that would have entailed all the same rights as "traditional marriages". Of course, lots of "conservatives" were against that, so W reached across the aisle. Crickets. Ds decided they wanted to preserve that issue's political value, so it was more than a decade before…

What's your point in your false equivalency? Are you implying that the 20 million people that now have medical coverage because of Democrats pushing for Obamacare isn't worth it? Was that all "talk"? I'm seriously trying to understand your "equivalency" position. Let me know what the Republicans would have done for health care? Right now it seems that the only thing they've done is to actually limit universal health…

> Let me know what the Republicans would have done for health care?

"Obamacare" (formerly known as "Romneycare") is a republican healthcare plan. One of the big reasons we claim that our two major parties are approximately equivalent is the Democrats' habit of passing Republican policies.

> since they are clearly very, very different

There are differences between R & D that are significant, but they are minor compared to all the ways they are the same. You can be 100% sure that politicians will side with their establishment, monied donors.

> Are the two parties the same on health care?

No, but they're both bad. Yes, Republicans are not going to improve healthcare, but neither are the Democrats. Did you know Feinstein said a few days ago in a town hall that she has no intention to support single-payer?

> it seems the only people that say that are Republicans

Assuming things like that only makes you sound partisan or uninformed. I'm not a Republican, so now you have a counterexample.

Re: Want to rescue rural America? Bust monopolies

#170

Post by Aloisius »

valuearb wrote: post #145
mjevans wrote: post #87

Earlier quoted context omitted.

Think Intel, AMD, and um, who else makes desktop grade chips? (No, netbooks/tops don't count)

Intel has never been a monopoly. There have always been dozens of competitors in most of their markets. Even at the height of Wintel, there was AMD and others. Intel didn't win there because it was able to shut out competitors, those competitors copied Intel designed instruction sets and Intel couldn't stop them from doing it. Intel dominated the market because of their better processes.

From an antitrust perspective, a monopoly is simply a firm with significant and durable market power with courts having typically set that to having over 50% marketshare within a certain geographic area.

Intel certainly qualifies.

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