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An Economy of Overfed Middlemen

mattstoller.substack.com

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Re: An Economy of Overfed Middlemen

#111

Post by WalterBright »

pessimizer wrote: post #74
WalterBright wrote: post #69

Earlier quoted context omitted.

Chernobyl hid the fact that the reactor was highly unsafe, because it was too expensive to fix it. So yeah, it was about money. Socialism is not immune to having things require a positive return on investment, and is hardly immune from forces that cause them to hide costs and risks. As for the benefits of capitalism, it's the only system that has managed to lift millions of poor people into the middle class and beyon…

> Chernobyl hid the fact that the reactor was highly unsafe, because it was too expensive to fix it. And that is bad. But it is different. > As for the benefits of capitalism, it's the only system that has managed to lift millions of poor people into the middle class and beyond. That's because capitalists take credit for China. Take China out of it, and capitalism is a no-op.

> But it is different.

Nope. Even socialism has to run at a net surplus (i.e. profit) because you cannot subsidize everything.

Re: An Economy of Overfed Middlemen

#112

Post by 8note »

WalterBright wrote: post #69
pessimizer wrote: post #65

Earlier quoted context omitted.

Chernobyl wasn't hiding the negative effects of making money. edit: I think Communism, or at least Soviet communism, is as bad or worse for the environment as capitalism. The difference is that the benefits of Soviet environmental disasters flowed to the nation in general. The benefits under capitalism generally go to fewer people than I could fit in my bathroom.

Chernobyl hid the fact that the reactor was highly unsafe, because it was too expensive to fix it. So yeah, it was about money. Socialism is not immune to having things require a positive return on investment, and is hardly immune from forces that cause them to hide costs and risks. As for the benefits of capitalism, it's the only system that has managed to lift millions of poor people into the middle class and beyon…

I don't think there's such an easy attribution to capitalism. If anything, it's ignoring property rights when people become richer.

If you consider the settler colonial projects like the USA, the wealth comes from ignoring the property ownership of the indigenous people, and then also the slavery, and the ignoring or intellectual property for inventions and arts.

If you look at Europe, there's the extreme wealth transfer of living and shifting the Indian economy into Europe, along with you know, stealing the world's gold, silver, and other valuables.

For more modern times, you also need to contend with unions and government regulations(including socialist policies), along with more wealth redistribution from things like the GI Bill. The people(and descendents) who benefited from the GI Bill are significantly wealthier than the people who didnt.

Wealth and land redistribution, especially at the expense of poorer people gives a clearer direction for what has lifted people out of poverty.

Re: An Economy of Overfed Middlemen

#113

Post by 8note »

zwieback wrote: post #49
jollyllama wrote: post #18

Earlier quoted context omitted.

>Imagine each consumer having to maintain relationships with ... tens of farmers Farmers' markets are great.

Farmers' markets are great, yes, as entertainment for wealthy consumers with spare time, me being one of those. As a sales channel they are extremely inefficient and all told probably bad for the environment.

As a sales mechanism for CSA boxes they aren't too bad

The efficiency is dependent on what you're measuring - food per land area? Food per energy input? Energy output per energy input?

Re: An Economy of Overfed Middlemen

#114

Post by paulryanrogers »

robertlagrant wrote: post #55
paulryanrogers wrote: post #2

Sometimes I wonder if 'monopoly' in the US has become a no true Scotsman fallacy. The threshold of direct consumer harm is either so high or evidence requirements so onerous it's as if there is no more Sherman Antitrust Act. The monopolizing doesn't even have to be in a computer or layers of shell companies anymore.

Are most monopolies not of government creation? Anything that has increasingly onerous regulations or other government requirements are the sorts of monopolies that need breaking. Any natural monopolies formed by just being really good at something and offering it at a low price are a waste of taxpayer money to try and disrupt.

Not all monopolies are natural. Those powerful enough to capture regulators are now a defacto government. The answer is not less regulation, it's a different kind to stop and reverse the consolidation of power.

And benevolent monopolies can and do change over time.

Re: An Economy of Overfed Middlemen

#115

Post by 8note »

asdff wrote: post #93
lotsofpulp wrote: post #42

Earlier quoted context omitted.

I would struggle to define sub 5% profit margin retailers and wholesalers as overfed.

Poor starving Target investors with their stock being up 180% from 5 years ago

Are they middle men though? The stocks are basically unrelated to the business being done, unless the value gets so low that the underlying assets are worth more.

Re: An Economy of Overfed Middlemen

#116

Post by cwmma »

rahimnathwani wrote: post #98
cwmma wrote: post #87

Earlier quoted context omitted.

Yeah the point of the article is if you can monopolize that layer you can extract enormous rent, especially if you get yourself exempted from the law against kickbacks which pharmacy middlemen did.

How does Walmart (cited early in the article) fit into this overall narrative? As a consumer, I feel like Walmart operates in a competitive market. I go to Walmart even less often than I go to Target.

Target and Walmart have lots of control over sellers (technically as a Monopsony), if the don't carry your product, it doesn't get to consumers.

Also you may be lucky to have a choice, there are plenty of places where it's just a Walmart or target.

Re: An Economy of Overfed Middlemen

#117

Post by UweSchmidt »

rahimnathwani wrote: post #104
UweSchmidt wrote: post #102

Earlier quoted context omitted.

The internet was supposed to clear out all the middlemen. The websites consumers and factories use should be completely commodified and under strong competition, and with lots of innovation, like in the early days. Very disappointing.

E-commerce isn't just about websites. If I buy a charging cord from a factory owner, how long before I have it in my hand? And how much will shipping cost? The fact that I can order a charging cord (or 10 different ones from 10 different manufacturers) and have them delivered tomorrow is innovation.

Market forces on a commodified, non-monopolized playing field should come up with all that innovation and bring us that charging cord faster and cheaper, and/or through a wider variety of curated market places and organic charging cord communities.

Re: An Economy of Overfed Middlemen

#118

Post by flappyeagle »

asdff wrote: post #96
softwaredoug wrote: post #8

The problem is users don’t necessarily want a fractured market. It’s convenient to have one vendor. In the short term, customers value the simplicity of having just one search engine or e-commerce experience. They don’t think about the long term harms to them / the economy.

Specialized vendors usually deliver better products than generalist vendors though because its simply harder to have expertise in all domains than a fewer number.

computers change that to a large degree - your youtube is different than my youtube... but it's all youtube.

Re: An Economy of Overfed Middlemen

#119

Post by taffronaut »

semanticjudo wrote: post #103

Brokers (what the author calls "middlemen") have existed for ages and served all sorts of purposes in all sorts of economic activities. They serve a specific and valuable function in the economy. The author muddles the point by bringing this into the equation. The core, valid issue raised is monopoly power. Which will naturally be the end goal of any enterprise. It is governments job to bring reasonable power to bear…

I respectfully disagree. Brokers are a subset of middlemen. In many industries the role of a broker is well-defined and often regulated. A middleman can be a broker, an agent, a facilitator, price comparison site, wholesaler or any other intermediary mechanism. For organisations which seek to own all aspects of the intermediary space, and with a generally opaque representation of benefit to both suppliers and clients, the use of the term middleman seems more appropriate.

Re: An Economy of Overfed Middlemen

#120

Post by zwieback »

8note wrote: post #113
zwieback wrote: post #49

Earlier quoted context omitted.

Farmers' markets are great, yes, as entertainment for wealthy consumers with spare time, me being one of those. As a sales channel they are extremely inefficient and all told probably bad for the environment.

As a sales mechanism for CSA boxes they aren't too bad The efficiency is dependent on what you're measuring - food per land area? Food per energy input? Energy output per energy input?

I was thinking of total energy (and maybe something like CO2) per food on the customer's table, including the waste that's produced.
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