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visitorq
Joined: 11 Jan 2008
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 Posted: Wed Oct 27, 2010 1:36 am Post subject: |
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| caniff wrote: |
| visitorq wrote: |
| In a free market big business and wealthy people are desirable |
Up to a point, I'd say. The top 5% controlling 90% of the wealth (for instance) doesn't seem very desirable to me.
(Unless I end up in the top 5%.) |
In a real free market wealth is not transferred from the public to a top percentile (i.e. the wealthy aren't wealthy at your expense). The pie just gets bigger - everyone gets wealthier, some just more than others. And although I can't really prove it one way or another, I highly doubt you'd ever get all the wealth transferred into the hands of 5% anyway; competition would be the great equalizer. You'd still have some very rich people, but they would become rich by producing more/better goods and services (wealth), not by sucking off the public (as the banks and corporations today do). Again, the only reason the robber baron class took over was by using the power of government to set up their monopolies. Such corruption can be traced all the way back to the first major corporations (which were railways), but really took off by the turn of the century, around the time the Federal Reserve was created. |
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recessiontime
Joined: 21 Jun 2010
Location: Got avatar privileges nyahahaha
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| Posted: Wed Oct 27, 2010 2:28 am Post subject: |
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| the thing is, capitalism as we know it is crony capitalism. You wouldn't get all the wealth in the hands of the top 10% if government didn't cater to the rich. |
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Fat_Elvis
Joined: 17 Aug 2006
Location: In the ghetto
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| Posted: Wed Oct 27, 2010 4:28 am Post subject: |
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| visitorq wrote: |
| In a real free market wealth is not transferred from the public to a top percentile (i.e. the wealthy aren't wealthy at your expense). The pie just gets bigger - everyone gets wealthier, some just more than others. |
Do you have any examples of this working in real life? |
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recessiontime
Joined: 21 Jun 2010
Location: Got avatar privileges nyahahaha
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| Posted: Wed Oct 27, 2010 8:20 am Post subject: |
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| Fat_Elvis wrote: |
| visitorq wrote: |
| In a real free market wealth is not transferred from the public to a top percentile (i.e. the wealthy aren't wealthy at your expense). The pie just gets bigger - everyone gets wealthier, some just more than others. |
Do you have any examples of this working in real life? |
yeah the alternate universe where the free market is really free and there was no bail-out for AIG. |
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comm
Joined: 22 Jun 2010
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| Posted: Wed Oct 27, 2010 10:11 am Post subject: |
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| recessiontime wrote: |
| the thing is, capitalism as we know it is crony capitalism. You wouldn't get all the wealth in the hands of the top 10% if government didn't cater to the rich. |
To be fair though, laissez-faire capitalism results in invulnerable monopolies. Example: I own a gas station. A big chain comes in and sells gas at a loss, compensating for the loss with other locations nationally. I go out of business. They jack their prices up since they now have a local monopoly. If it's expensive to get into the market (that is, to build a new gas station to compete) nobody will do it, since they'd just get knocked out too and lose their initial investment. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Wed Oct 27, 2010 12:00 pm Post subject: |
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| comm wrote: |
| recessiontime wrote: |
| the thing is, capitalism as we know it is crony capitalism. You wouldn't get all the wealth in the hands of the top 10% if government didn't cater to the rich. |
To be fair though, laissez-faire capitalism results in invulnerable monopolies. Example: I own a gas station. A big chain comes in and sells gas at a loss, compensating for the loss with other locations nationally. I go out of business. They jack their prices up since they now have a local monopoly. If it's expensive to get into the market (that is, to build a new gas station to compete) nobody will do it, since they'd just get knocked out too and lose their initial investment. |
No, because as long as selling gas is profitable, there will be competition. Just because you go under as a small owner doesn't mean a larger company won't move in and take a cut into the market. Locally a price war may even result, which benefits the consumer. There is absolutely no way that free market capitalism results in any kind of monopoly. There is no such thing as a natural monopoly, only the government has the power to create monopolies through regulation. |
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rollo
Joined: 10 May 2006
Location: China
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| Posted: Wed Oct 27, 2010 8:48 pm Post subject: |
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The tea party certainly emerged out of the libertarian movement. The near death of the Republican party led many to embrace it at first. But the whacko statements of some of its candidates in recent months has caused many to flee back to the mainstream Republican ranks. A teaparty rally was held in Nashville Tennessee this week with a big name speaker, actor Stephen Baldwin and it drew less than 150 .
Milton Friedmans name has been smeared so much by the left. He did not espouse Pinochet's repression . he met the man once for a few minutes and lectured him about the human right's violations in Argentina. He worked as a consultant for several countries besides Argentina. If the left blames him for the crimes of Pinochet they should credit him with lifting 400 million chinese peasant's out of crushing poverty. He was a consultant to the Chinese leadership in the 70's. |
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TheUrbanMyth
Joined: 28 Jan 2003
Location: Retired
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| Posted: Wed Oct 27, 2010 9:34 pm Post subject: |
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| visitorq wrote: |
| comm wrote: |
| recessiontime wrote: |
| the thing is, capitalism as we know it is crony capitalism. You wouldn't get all the wealth in the hands of the top 10% if government didn't cater to the rich. |
To be fair though, laissez-faire capitalism results in invulnerable monopolies. Example: I own a gas station. A big chain comes in and sells gas at a loss, compensating for the loss with other locations nationally. I go out of business. They jack their prices up since they now have a local monopoly. If it's expensive to get into the market (that is, to build a new gas station to compete) nobody will do it, since they'd just get knocked out too and lose their initial investment. |
No, because as long as selling gas is profitable, there will be competition. Just because you go under as a small owner doesn't mean a larger company won't move in and take a cut into the market. Locally a price war may even result, which benefits the consumer. There is absolutely no way that free market capitalism results in any kind of monopoly. There is no such thing as a natural monopoly, only the government has the power to create monopolies through regulation. |
Two words: Standard Oil. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Thu Oct 28, 2010 4:15 am Post subject: |
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| TheUrbanMyth wrote: |
| visitorq wrote: |
| comm wrote: |
| recessiontime wrote: |
| the thing is, capitalism as we know it is crony capitalism. You wouldn't get all the wealth in the hands of the top 10% if government didn't cater to the rich. |
To be fair though, laissez-faire capitalism results in invulnerable monopolies. Example: I own a gas station. A big chain comes in and sells gas at a loss, compensating for the loss with other locations nationally. I go out of business. They jack their prices up since they now have a local monopoly. If it's expensive to get into the market (that is, to build a new gas station to compete) nobody will do it, since they'd just get knocked out too and lose their initial investment. |
No, because as long as selling gas is profitable, there will be competition. Just because you go under as a small owner doesn't mean a larger company won't move in and take a cut into the market. Locally a price war may even result, which benefits the consumer. There is absolutely no way that free market capitalism results in any kind of monopoly. There is no such thing as a natural monopoly, only the government has the power to create monopolies through regulation. |
Two words: Standard Oil. |
Do some research. The original Standard Oil was never a monopoly. I often have disparaging things to say about the Rockefeller family, but to give credit where it's due John D. Sr. did build his company up from scratch and was a phenomenal businessman. He bargained very effectively for crude, refined it better and more cheaply than his competitors (of which there were hundreds). From around 1870 to 1880 Standard Oil was so effective, and was able to cut prices so much, that it swallowed up a huge 80% market share (still not a monopoly). It was also able to get volume discounts from the railways, which helped lower prices even further (fair play, the same offer was open to any competitors who could match Standard Oil's volume). Standard Oil's success benefited the consumer very much as prices fell 2/3rds by 1880. This also forced competitors to improve their own production processes, which eventually resulted in Standard Oil's market share falling from its high of 88% in 1890 to just 64% in 1911 (before the Supreme Court had ruled against them in their anti-trust case). In a free market, a successful company can take take a very large segment of the market, but this never lasts.
Standard Oil was broken up by anti-trust regulation, and by the end of WWI, the government basically passed regulation (such as President Calvin Coolidge creating a Federal Oil Conservation Board in 1924 that enforced the compulsory withholding of oil resources and state prorationing of oil, ie. monopoly), controlling prices and production levers, basically turning it into the industry into the cartel it has been ever since.
So, it wasn't until the government intervened that big oil became a really monopolistic, with price controls and rationing. It was also around this time that the Rockefellers began involving themselves heavily in government (John D. Jr. would go on to marry the daughter of the very powerful Senator Nelson Aldrich, one of the most instrumental men in the creation of the Federal Reserve System). |
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mises
Joined: 05 Nov 2007
Location: retired
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| Posted: Fri Oct 29, 2010 7:36 am Post subject: |
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A couple articles on the Tea Party:
http://original.antiwar.com/giraldi/2010/10/27/the-tea-party-disconnect/
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| Tea partiers must begin to understand that accepting the calls of leaders like Palin and Gingrich for smaller and more sensible government and a return to constitutionalism without also understanding that they stand for an incoherent foreign policy, perpetual war, and ballooning deficits is self defeating. |
http://www.amconmag.com/blog/2010/10/29/not-one-but-three-tea-parties/
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| Having looked at the swelling of the Tea Party, I�ve come to the conclusion that it�s not a uniform movement. There are at least three different movements trying to give the impression of being one. |
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Nowhere Man
Joined: 08 Feb 2004
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| Posted: Fri Oct 29, 2010 12:49 pm Post subject: ... |
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| Quote: |
| The pie just gets bigger - everyone gets wealthier, some just more than others. |
| Quote: |
| Just because you go under as a small owner doesn't mean a larger company won't move in and take a cut into the market. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Fri Oct 29, 2010 1:30 pm Post subject: |
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| Nowhere Man wrote: |
| Quote: |
| The pie just gets bigger - everyone gets wealthier, some just more than others. |
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| Just because you go under as a small owner doesn't mean a larger company won't move in and take a cut into the market. |
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I see logic escapes you. Nothing I wrote was contradictory. Just because a business can't compete against superior competition and goes bust doesn't mean we need the government to get involved. Want to start a business? Find a gap in the market and fill it (work hard, if at first you don't succeed etc). Or if business isn't your thing, you can always offer your services and go work for somebody else (unless of course you'd rather government just got rid of all the affluent people and businesses, then there'd be no jobs left and you could just go on food stamps instead and get something for nothing - problem solved)... |
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Nowhere Man
Joined: 08 Feb 2004
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| Posted: Fri Oct 29, 2010 5:00 pm Post subject: ... |
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| Quote: |
| Quote: |
| The pie just gets bigger - everyone gets wealthier, some just more than others. |
| Quote: |
| Just because you go under as a small owner doesn't mean a larger company won't move in and take a cut into the market. |
I see logic escapes you. Nothing I wrote was contradictory. |
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visitorq
Joined: 11 Jan 2008
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| Posted: Fri Oct 29, 2010 9:26 pm Post subject: Re: ... |
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| Nowhere Man wrote: |
| Quote: |
| Quote: |
| The pie just gets bigger - everyone gets wealthier, some just more than others. |
| Quote: |
| Just because you go under as a small owner doesn't mean a larger company won't move in and take a cut into the market. |
I see logic escapes you. Nothing I wrote was contradictory. |
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You've got nothing. |
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TheUrbanMyth
Joined: 28 Jan 2003
Location: Retired
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| Posted: Mon Nov 01, 2010 10:15 pm Post subject: |
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| visitorq wrote: |
| [q. There is absolutely no way that free market capitalism results in any kind of monopoly. There is no such thing as a natural monopoly, only the government has the power to create monopolies through regulation... |
| visitorq wrote: |
In a free market, a successful company can take take a very large segment of the market, but this never lasts.
. |
Well most sources refer to Standard Oil as a monopoly. True it wasn't an absolute monopoly but with a near 90% share of the market at one point it might as well have been.
I agree that a successful company can take a very large share of the market but this never lasts. Well nothing lasts forever.
But that is different from saying the free market does not create monopolies. Whether they last or not is beside the point. At one point Microsoft was deemed a monopoly with a 90% share of the market (similar to Standard Oil).
And this was a federal judge saying this.
http://news.cnet.com/2100-1040-232565.htm
And who's to say that if Microsoft and Standard Oil hadn't been broken up (as they would NOT have been in a totally free market) that they wouldn't have (respectively) kept/regained their dominance?
Last edited by TheUrbanMyth on Mon Nov 01, 2010 10:26 pm; edited 3 times in total |
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