trc@houti.UUCP (06/11/83)
Response to a reply to my reply to Jeff Myers' reply to my original article(!): I understand you to be saying that, you accept that businesses can hurt their long range self interest by trying to fix prices, but they hurt others in the process. Further, you state that such actions would often be taken, if not for anti-trust laws and such, and that the result of such actions is to keep high profit margins. I have no statistical evidence showing whether corporations hurt others more or less (on the long term average) with cartels and such. But I can point out two things. A price fixing cartel encourages more competitors, so that when the cartel eventually breaks, prices are likely to be cut to a bare minimum - probably lower than the original competitors would have charged. Secondly, if some of the competitors go out of business, their stockholders lose money. Where does that money go? Since profits are being cut to the bone, it mostly goes to customers in the form of reduced prices. And it seems to me that protection of the consumer interests was what motivated anti-trust laws in the first place. Anti-trust laws have the negative impact that they constrain businesses where they do not need to be constrained. We all pay the price for the anti-trust laws in higher prices, and lower quality. The recent difficulty with allowing corporations to collaborate on basic AI research is only the latest example. When a law is wrong in principle, even if it "works", it will have effects that are bigger and worse than its intended primary effect. Tom Craver houti!trc