eklhad@ihnet.UUCP (K. A. Dahlke) (07/27/85)
> Charley Wingate umcp-cs!mangoe > there seem to be two conflicting uses of the word "free" > here. If you take "free market" to mean something like a classical economy, > then you do indeed get the benefits claimed. But libertarians seem to me to > be quite consistent in equating "free market" with uncontrolled market. Agreed, and I thank you for pointing this out. I might go a step further and suggest that there is a continuous spectrum of economic freedom (others have mentioned this as well). I personally would like to see a free(er) economy. Does this make me a libertarian? I don't know. > history rather plainly shows that markets tend to drift away from perfect > competition towards monopolies and oligopolies as a result of natural > forces, unless there are restraining forces to oppose this. In some > industries, these forces exist naturally. This is not the case, however, in > most manufacturing industries. Hence, there seems to be a contradiction > here; you can't have classical free markets and uncontrolled markets at the > same time. Although learning from history is valuable (something we don't do enough of), it has its limitations. This is particularly apparent when individuals try to support nuclear proliferation/reduction policies by using historical arguments. There is simply no comparison. To a much lesser degree, historical economic arguments are also limited. As I mentioned in my previous article, technology and education drastically affect the viability of a free economy. I worked for a monopoly 3 years ago, but I don't now. The break up of AT&T was not viable 20 years ago, but competition is possible today. The capital costs associated with entering the long distance communications business, while substantial, are no longer prohibitive, and the competitive environment is unlikely to produce a monopoly. It is possible that one company, by virtue of its quality, *may* dominate a market (a lot of blue mainframes out there), but this is *not* a monopoly, since a superior competitor *could* challenge the incumbent. In general, monopolies and oligopolies become less of a problem each decade. (I must admit, utilities look like they will be monopolies forever, due to their extreme capital vs marginal costs, but you never know.) My point is, free(er) societies may be viable, and it is worth listening to libertarian ideas. Deregulation often benefits the companies, employees, and the consumers (e.g. airline industry). If you wish to use a historical example to prove that specific policies are risky, you must guard against overgeneralization. Unions were essential 80 years ago; most are counterproductive today. Appropriate economic policies depend on the time and country. The U.S. (today) would benefit from a simpler freeer economy. -- This .signature file intentionally left blank. Karl Dahlke ihnp4!ihnet!eklhad
mangoe@umcp-cs.UUCP (Charley Wingate) (07/30/85)
I generally agree with Karl's article, except that I'm not sure that I agree that monopolies are becoming less feasible. These days, I think there are several oligopolies which have formed through parallel thinking. The actions of the american car manufactures are a case in point. Before the imports could mount a significant assault on the US market, the Big Three were making much the same cars, at the same prices. As industries age, I think this is going to become more common. Obviously, however, this is not an irresistable force. Charley Wingate