Monopoly and Competition

With the passage of time, the nature of post-Saddam Iraq becomes clearer, as does the Bush administration's lack of commitment to free-market principles.

No, there are no economic agencies in this country like Gosplan, but the U.S. Government, as well as many state and local governments, engage in central economic planning all the same. As Bill Anderson tells us, in the end, it is still central economic planning and, not surprisingly, it does not work any better here than it did in the U.S.S.R.

Complete privatization will not lead to ideal results, but it will unravel most of the anticompetitive practices that exist in the cable industry. The lesson that we should draw from the results of the Telecommunications Act of 1996 is that efforts to partially privatize the industry are likely to retain those elements of regulations that benefit concentrated interests in business most.

While protectionism may temporarily prop up inefficient industries and businesses, ultimately market forces will prevail, hurting even the favored industry. An insider tells the story of the copper industry--and how it ultimately lost out to fiber optics. 

Competition is as wholesome in education as it is in manufacture and commerce, writes Hans Sennholz. Every school is an economic check on its competitors. However, government funding for higher education has dramatically changed the economics of this sector, vastly increasing costs, reducing service, and skewing curricula toward political ends.

The Scana Corporation is a government-created monopoly that provides electricity to most of the state of South Carolina. Like all regulated corporations, it is pressured by regulators to promote politically correct causes and policies--or else. Thomas DiLorenzo highlights the absurd results.

The Enron story provides what academics call "teaching moments," that is, opportunities to explain how economic theory can explain the outcome of state involvement in market processes. Interventionism often results in failures such as Enron's, and lessons learned by studying it may help avoid similar problems in the future.

Ted Roberts asks why his president, my congressman, my governor, the Postmaster General, or the county tax assessor isn't as eager to hear his opinions as a manufacturer of sugared, cola-flavored water? Politicians seem oblivious to the charms of consumer prejudices, but giants like Pepsi, and even local mom-and-pop barbecue caterers, whirl like a weather vane in their currents.

Why is there so much religious passion in the tone of the Microsoft critics? Why is it so difficult to understand that the marketplace is a far better evaluator of Microsoft's product than a federal judge who tries to synthesize, express, and enforce the whims of 20 million consumers whom he's never talked to?

The City of New York monopolizes the distribution of water, and as such the supply is always in jeopardy.  Rather than study the details of the city's recently adopted Drought Management Plan, New York residents would be wiser to pray for rain.