I Guess it Took Modern Day Robber Barons to Realize This

One area where I’ve always departed with libertarian market purists is on anti-trust, but I could never really articulate it well until now:

One place where I break with the Borkian consensus on antitrust is that I don’t think the Sherman Act was about maximizing consumer welfare so much as it was about inhibiting the growth of unaccountable political power. (The drafers of the Sherman Act, of course, weren’t aware of Bork’s theories.) We’re seeing a lot of unaccountable political power here, and it’s going to get worse if nothing’s done.

I probably couldn’t have come to the conclusion in my 20s, but these days I think political power and economic power aren’t really separable. The latter breeds the former.

If you worked in tech in the 1990s, you remember Microsoft using its monopoly in operating systems to essentially strangle Netscape. By the time the government came around to dealing with that, technology had moved on. Back then I felt it was a pretty good example of how anti-trust law wasn’t really well suited to a post-industrial economy such as ours. But Microsoft’s great accomplishment was swindling IBM out of their monopoly on computing. Jeff Bezos has laid waste to main streets across this country. Google has absconded with the advertising revenues of all the local news rags we grew up with. Don’t even get me started on Facebook.

And we all cheered while they were doing it. What a fool I feel like for believing technological and free market progress would eventually solve all our ills. I might not believe Trumpian populism is the answer, but I can’t help but say we’re in a hell of a pickle now.

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23 thoughts on “I Guess it Took Modern Day Robber Barons to Realize This”

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  4. Jeff Bezos? How about *Walmart*? ;^) Walmart was the original destroyer of main-street, and has kept the pressure on companies to shift manufacturing off-shore for 30+ years. Bezos is trying to take on Walmart.

  5. P.S. I agree with you about antitrust, and I think Bork was an asshole for his bullshit theories about consumer pricing. However, if you want to apply antitrust, you’ll run into Walmart, the reconstituted Standard Oil (how many big oil companies in the US, 2 o 3?), the reconstituted Bell System (Comcast and Verizon), etc.

    So don’t leave them out.

  6. Will they last, though? MS swindled IBM out of their monopoly, then lost it to Google and Apple. Facebook seems well-ensconced, but they aren’t actually making a lot of profit (are they making a profit?) Amazon didn’t destroy the Main Street, Walmart did; but the Beast of Bentonville and the Serpent of Seattle are waging a war of biblical proportions.

    Twitter is in the process of demonstrating that it’s really not a good business decision to abuse a position of control over traffic for political reasons. (Though Twitter has an “other people’s money” problem underlying that anyway). Everybody thinks Twitter is toxic, and the more they crack down on wrongthink, the more toxic it will get, as the trolls who are left become relatively more visible and more invested in “fighting the Man.”

    I’m still more worried about heavy-handed government; see the Canadian High Court’s judgement that Google must censor content worldwide lest some Canadian see something the Canadian Government has deemed inappropriate for them to see (it’s a defamation case); or the EU’s “right to be forgotten” regime.

  7. It takes government to add coercion to the unholy mess that the tech oligarchs are making. The partnership of government and the oligarchs makes both more dangerous. Up to early Bill Gates, monopolies tended to use their power to strangle their competitors while leaving citizens more or less alone and having a probably neutral to positive effect on consumers. Now the oligarchs reach for control over government with its monopoly on coercion and intend to use that to make all aspects of our lives confirm to their own beliefs. For this they must be destroyed with whatever tools come to hand, including anti-trust.

    1. “It takes government to add coercion to the unholy mess that the tech oligarchs are making…”

      That’s why oligarchs throughout the centuries have always sought “partnerships between business and government.” Usually, successfully. Look how the railroads partnered with government in the 19th century.

      Arguably the American Revolution is at least partially traceable to the East India Company. King George’s “tea tax” was in part a bailout for the East India Company. And roughly 70 years later, England’s “Corn Laws” were contrived to make it profitable to export grain out of starving Ireland, thus clearing the land of small tenants so the large landholding nobles could switch to livestock production which was more profitable. (Throughout history, the nobility, whether by inheritance or the noveau riche, have always been de facto the government.)

      1. They didn’t do so well in the socialist regimes of the 20th Century. With the neo-socialists of the late 20th Century and the 21st they are doing all too well.

        1. “With the neo-socialists…”

          I believe what you are referring to is “neo-liberalism.”

            1. Here is a general definition of neoliberalism. It is socialist to the extent that it is implemented collectively, by governments.

              Neoliberalism

              Neoliberalism (neo-liberalism)[1] refers primarily to the 20th-century resurgence of 19th-century ideas associated with laissez-faire economic liberalism.[2]:7 These include extensive economic liberalization policies such as privatization, fiscal austerity, deregulation, unrestricted free trade,[3] and reductions in government spending in order to increase the role of the private sector in the economy and society.[11] These market-based ideas and the policies they inspired constitute a paradigm shift away from the post-war Keynesian consensus which lasted from 1945 to 1980.[12][13]

              The term has been used in English since the start of the 20th century with different meanings,[14] but became more prevalent in its current meaning in the 1970s and 1980s by scholars in a wide variety of social sciences,[15][16] as well as being used by critics.[17][18] Modern advocates of free market policies avoid the term “neoliberal”[19] and some scholars have described the term as meaning different things to different people,[20][21] as neoliberalism “mutated” into geopolitically distinct hybrids as it traveled around the world.[4] As such, neoliberalism shares many attributes with other contested concepts, including democracy.[5]

              The definition and usage of the term have changed over time.[5] It was originally an economic philosophy that emerged among European liberal scholars in the 1930s in an attempt to trace a so-called “third” or “middle” way between the conflicting philosophies of classical liberalism and socialist planning.[22]:14–5 The impetus for this development arose from a desire to avoid repeating the economic failures of the early 1930s, which were mostly blamed by neoliberals on the economic policy of classical liberalism. In the decades that followed, the use of the term neoliberal tended to refer to theories at variance with the more laissez-faire doctrine of classical liberalism, and promoted instead a market economy under the guidance and rules of a strong state, a model which came to be known as the social market economy.

              In the 1960s, usage of the term “neoliberal” heavily declined. When the term was reintroduced in the 1980s in connection with Augusto Pinochet’s economic reforms in Chile, the usage of the term had shifted. It had not only become a term with negative connotations employed principally by critics of market reform, but it also had shifted in meaning from a moderate form of liberalism to a more radical and laissez-faire capitalist set of ideas. Scholars now tended to associate it with the theories of economists Friedrich Hayek, Milton Friedman and James M. Buchanan, along with politicians and policy-makers such as Margaret Thatcher, Ronald Reagan and Alan Greenspan.[5][23] Once the new meaning of neoliberalism was established as a common usage among Spanish-speaking scholars, it diffused into the English-language study of political economy.[5] By 1994, with the passage of NAFTA and the Zapatistas’ reaction to this development in Chiapas, the term entered global circulation.[4] Scholarship on the phenomenon of neoliberalism has been growing.[16] The impact of the global 2008–2009 crisis has also given rise to new scholarship that critiques neoliberalism and seeks developmental alternatives.[24]

              A group of 25 intellectuals organised the Walter Lippmann Colloquium at Paris in August 1938. It brought together Louis Rougier, Walter Lippmann, Friedrich von Hayek, Ludwig von Mises, Wilhelm Röpke and Alexander Rüstow among others. Most agreed that the liberalism of laissez faire had failed and that a new liberalism needed to take its place with a major role for the state. Mises and Hayek refused to condemn laissez faire, but all participants were united in their call for a new project they dubbed “neoliberalism.”[46]:18–9 They agreed to develop the Colloquium into a permanent think tank called Centre International d’Études pour la Rénovation du Libéralisme based in Paris.

  8. Remember that us libertarians want a State with nothing to sell, and thus all that monopolist money can’t buy it.

    While the State remains the most useful thing to buy, maybe, sure, some sort of size limits, maybe.

    (But equally, the anti-trust measures themselves and “convince the FTC to let you” opens up all kinds of nice payoff opportunities and rent-seeking and “sic ’em on the competition” …

    If it was easy to perfect mankind, we’d already have done it.)

    1. “If it was easy to perfect mankind, we’d already have done it.”

      A problem is, nobody seems to know what perfection looks like, but everyone insists on it.

    2. “… a State with nothing to sell…”

      Which of course would be no State at all…

        1. I am familiar with it. And with most of the competing claims regarding what it (and thus, perfection) really means, or was intended to mean. (I’m sure you know to a certainty, but isn’t it frustrating having all those other people deliberately avoiding perfection?)

          But I know we have nine SCOTUS Justices only because it takes that many to tell us in their unanimity what perfection looks like.

  9. Anti-trust law may have been *intended* to limit the political power of the oligarchs. In reality – even during the early ages – it was used as a baton against those particular corporations the sitting President disapproved of.

  10. Wait, how do you “swindle” a company out of something that it — however shortsightedly — is not interested in pursuing? IBM found itself in the desktop computer/small operating system business almost by accident and wasn’t all that happy with it.

    Politics and big money is always in bed; politics can have some determining influence on who ends up with big money (landed gentry, captains of industry, successful criminals, politicians) but you can’t do much about it other than limit the power of government over men and non-governmental endeavors — which runs smack up against the flipside issue of limiting the unchosen/non-refusable power of non-governmental endeavors over men. Unscrew that Gordian knot and you’re home free. Better bring a sack lunch.

    1. Monopoly on (enterprise) computing – not on desktop computers. IBM had Asimov’s ACs, and was dominant in the big iron game. Microcomputers did not exist when I was born. Microsoft snuck in under the noses of IBM, with the connivance of IBM itself, and ran off with enterprise computing; though they were not the first to or best at microcomputing. UNIX stole academic computing out from under the big iron companies, but I’m not entirely sure how dominant IBM was in that market.

      1. Burroughs never existed? The PDP-9s and DEC-10s of my youth were an illusion? IBM never had a monopoly; they certainly never even approached Bell in terms of market dominance (and government protection/regulation).

        1. I should know better than engage is a battle of knowledge and history with you. I surrender unconditionally.

  11. Correction:
    It is Craigslist(CL) that mostly eliminated newsprint advertising revenue.

    What is hilarious to me is that the group that put such a hurting on one of the strong arms of the liberals was a fellow group of hippie leftists. Talk about “friendly fire”!

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