GA illegal immigration bill ruins crops

[StSapphire]

Really? You claim that most big business is a monopoly and yet you can't think of a single monopoly off the top of your head? If your statement were true, you should be able to name any big company off the top of your head and it would most likely be a monopoly. Let me try. Walmart. No, there's Target. Exxon Mobil. Whoops, there's Chevron. Dell. Not with HP. And on and on it goes.

Probably a futile question, but what towns has Walmart alone turned into ghost towns?

So what you're naming are... oligopolies. Which, to the customer, have roughly the same negative effect on customers (limiting choices, crowding out competitors, stifling competition, etc). Airlines, especially, first come to mind. There are... what, two or three airline carriers in any given city. If you want more choices than two or three... too bad! The carriers in a given city very often will crowd out any competition once they're ensconced. To give an example, my city has a grand total of two airline companies you can fly domestic on in our airport. Our international airport (ie this isn't some backwoods airport, it's a Delta hub city). When one of the low-cost airlines tried to enter the market, Delta temporarily lowered their fares to undercut them and prevent the new carrier from getting any business. Two months later, they were gone, and Delta's rates were not only back up, but even higher than prior. Permanently.

 

[darkdog]

Sorry, I had to turn in an get up before dawn, but now I got the rest of the day off.
I rechecked the link I provided and am thoroughly disgusted, lol. But I implied that there is plenty of evidence if one would but google, and you leave the brunt of proving the argument on me while you do not provide any links of your own. I made the statement that Walmart if killing our towns and you said "Oh yeah? Prove it!" and the inescapable conclusion is that you disagree with it. If you disagree with it, then so be it, but I will not exert myself in finding link after link that you ridicule, since I have the feeling you will not accept any evidence I submit, whether it be personal anecdotes or online publications. What have you shown as proof of your arguments? Nothing at all. You have expressed opinions that Walmart and big business is a good thing and let it go at that. So be it. I have personally driven through towns near Walmart that are deserted, with houses boarded up and weeds growing in the roads. I do not blame Walmart entirely, mind you, since it takes customers to make this happen. As the following link shows, Walmart has grown at an exponential rate ( Watch the Growth of Walmart and Sam's Club Across America | FlowingData ) and they should have been stopped in their tracks. ( Justice Department Gets Tough on Monopolies - small business - antitrust ) Improving the quality of life, you say? Nawww, not if the products are made overseas and are shoddy to begin with. Ah well.

Yes, I'm very skeptical idea that Walmart alone has created ghost towns. However, it's nearly impossible to prove a negative, and much easier to prove a positive. If you can find a ghost town where Walmart was the main factor, please show it. Besides, it's your point that you made. It's reasonable to expect that you be the one to provide the facts to back it up.

As for shoddy products, yeah, many products are shoddy, but many are not. There are plenty of options available for those who want higher quality products, but sometimes it just makes economic sense to buy junk. If I want a blender, but I only plan to use it every few months, I probably don't need to buy an expensive one that was designed to withstand millions of hours of use. The cheap one at Walmart will do and that frees up my funds to buy other stuff.

So what you're naming are... oligopolies. Which, to the customer, have roughly the same negative effect on customers (limiting choices, crowding out competitors, stifling competition, etc). Airlines, especially, first come to mind. There are... what, two or three airline carriers in any given city. If you want more choices than two or three... too bad! The carriers in a given city very often will crowd out any competition once they're ensconced. To give an example, my city has a grand total of two airline companies you can fly domestic on in our airport. Our international airport (ie this isn't some backwoods airport, it's a Delta hub city). When one of the low-cost airlines tried to enter the market, Delta temporarily lowered their fares to undercut them and prevent the new carrier from getting any business. Two months later, they were gone, and Delta's rates were not only back up, but even higher than prior. Permanently.

Having several companies compete against each other is far preferable to a monopoly, as long as they're not colluding. I mean, they still have to compete with each other and try to sell better things for lower prices. You listed three things, (limiting choices, crowding out competitors, stifling competition), but that's really three different ways of saying the same thing. As I've mentioned earlier in this thread, one of the ways they do that is by using political influence to get politicians to pass regulations that put up barriers to new competitors and harm already existing small competitors. One way to solve that problem is to lessen the power that politicians have, especially at the federal level.

However, I'm not a total libertarian and I'm fine with anti-trust laws. As for your airport situation, one thing local governments can do is do what Texas did when they deregulated electricity in 2002- they set a "Price to Beat" which was basically a price floor that was good for five years. Already existing energy companies could not go below it but new companies could. Such a thing would prevent them from temporarily lowering their prices to destroy the new competition while giving new companies enough time to establish themselves. Of course, such a thing must be approached with caution because of that darn law of unintended consequences.

 

[kokonut]

Yes, I'm very skeptical idea that Walmart alone has created ghost towns. However, it's nearly impossible to prove a negative, and much easier to prove a positive. If you can find a ghost town where Walmart was the main factor, please show it. Besides, it's your point that you made. It's reasonable to expect that you be the one to provide the facts to back it up.

As for shoddy products, yeah, many products are shoddy, but many are not. There are plenty of options available for those who want higher quality products, but sometimes it just makes economic sense to buy junk. If I want a blender, but I only plan to use it every few months, I probably don't need to buy an expensive one that was designed to withstand millions of hours of use. The cheap one at Walmart will do and that frees up my funds to buy other stuff.


Having several companies compete against each other is far preferable to a monopoly, as long as they're not colluding. I mean, they still have to compete with each other and try to sell better things for lower prices. You listed three things, (limiting choices, crowding out competitors, stifling competition), but that's really three different ways of saying the same thing. As I've mentioned earlier in this thread, one of the ways they do that is by using political influence to get politicians to pass regulations that put up barriers to new competitors and harm already existing small competitors. One way to solve that problem is to lessen the power that politicians have, especially at the federal level.

However, I'm not a total libertarian and I'm fine with anti-trust laws. As for your airport situation, one thing local governments can do is do what Texas did when they deregulated electricity in 2002- they set a "Price to Beat" which was basically a price floor that was good for five years. Already existing energy companies could not go below it but new companies could. Such a thing would prevent them from temporarily lowering their prices to destroy the new competition while giving new companies enough time to establish themselves. Of course, such a thing must be approached with caution because of that darn law of unintended consequences.

And was there any law of unintended consequences as a result so far? What you stated began 9 years ago, how is it fairing today?

 

[darkdog]

And was there any law of unintended consequences as a result so far? What you stated began 9 years ago, how is it fairing today?

I haven't really followed it too closely, but from what I can tell, everything went well. The price floor expired in 2007 and there's plenty of competition and choices and the prices are quite reasonable (about $.10/kW-hr in this area).

 

[TXgolfer]

That may very well be a condition of their employment; drawn up in the contract they sign. I recall when NHL players would be sad to be traded to Canadian teams, because they would be paid in Canadian dollars, which were lower valued at the time. (I believe that is still the case)

Canadian dollar is higher now. Player are just sad because.... Well it's Canada ...

 

[StSapphire]

Having several companies compete against each other is far preferable to a monopoly, as long as they're not colluding. I mean, they still have to compete with each other and try to sell better things for lower prices. You listed three things, (limiting choices, crowding out competitors, stifling competition), but that's really three different ways of saying the same thing. As I've mentioned earlier in this thread, one of the ways they do that is by using political influence to get politicians to pass regulations that put up barriers to new competitors and harm already existing small competitors. One way to solve that problem is to lessen the power that politicians have, especially at the federal level.

When the barrier to entry in a field is so high that any of the existing players can easily drive out any new competition, then you're at risk of an oligopoly. Another example that I thought of in the US was cell phone providers and ISPs. If you have two or three options in an area, sure, that's better than a single option, but at the same time... it's also not, because it gives you a false sense of security, since while you say they have to "compete"... as the case may be, they very often really don't have to compete.

 

[darkdog]

When the barrier to entry in a field is so high that any of the existing players can easily drive out any new competition, then you're at risk of an oligopoly. Another example that I thought of in the US was cell phone providers and ISPs. If you have two or three options in an area, sure, that's better than a single option, but at the same time... it's also not, because it gives you a false sense of security, since while you say they have to "compete"... as the case may be, they very often really don't have to compete.

One more suggestion to keep barriers to entry low is to do away with licensing in many fields. Certainly, we want doctors and teachers to have licenses, but a license to do hair or drive a taxi? The only point of those is throw up barriers for competition.

For the two products you mention, cell phones providers and ISPs, you can find well more than two or three providers in most populated areas. One big reason the barrier to entry is high in those markets is because they involve a lot of technical infrastructure. It takes a lot of capital to set up wireless towers and fiber optics cables. It's just the nature of the beast. Still, market disruptions happen all the time where smaller more innovative companies rise up out of nowhere and seriously undermine giant corporations. At one big company I used to work at, they were seriously worried about this and kept pushing for innovation and even made us read "The Innovator's Dillema" by Clay Christensen. I doubt it did them much good since the environment there just wasn't very conducive to innovation, but given the nature of capitalism, they had good reason to feel exposed.

You said that very often they don't have to compete. Can you name a market? Because if you can find a market where there truly is no competition, then you've probably found a market where there's collusion.

So I've already mentioned three ways to cope with the problem of high barriers to entry. What are your suggestions?

 

[StSapphire]

One more suggestion to keep barriers to entry low is to do away with licensing in many fields. Certainly, we want doctors and teachers to have licenses, but a license to do hair or drive a taxi? The only point of those is throw up barriers for competition.

I wasn't aware doing your hair or driving a taxi had a dearth of competition. Not arguing necessarily in favor of licensing, but that doesn't exactly support your point.

For the two products you mention, cell phones providers and ISPs, you can find well more than two or three providers in most populated areas. One big reason the barrier to entry is high in those markets is because they involve a lot of technical infrastructure. It takes a lot of capital to set up wireless towers and fiber optics cables. It's just the nature of the beast. Still, market disruptions happen all the time where smaller more innovative companies rise up out of nowhere and seriously undermine giant corporations. At one big company I used to work at, they were seriously worried about this and kept pushing for innovation and even made us read "The Innovator's Dillema" by Clay Christensen. I doubt it did them much good since the environment there just wasn't very conducive to innovation, but given the nature of capitalism, they had good reason to feel exposed.

You said that very often they don't have to compete. Can you name a market? Because if you can find a market where there truly is no competition, then you've probably found a market where there's collusion.

So I've already mentioned three ways to cope with the problem of high barriers to entry. What are your suggestions?

I'm not saying there aren't reasons that oligopolies exist, but they do, and they're inherently harmful to customers without regulation. High cost of entry simply because building infrastructure is expensive is a perfectly valid reason for an oligopoly to exist, but that doesn't make it less harmful to consumers.

I don't see any methods of coping for high barriers to entry mentioned other than "get rid of licensing" for fields that currently have very low barriers to entry (and for that matter, have no issue with lack of competition).

The three specific industries I've mentioned so far - airlines, cellular providers and ISPs - do not have to compete with each other. When you're providing a service that most people consider necessary (as almost all of those except for possibly airlines generally are), and there are a grand total of two, maybe three options in an area for that service, both companies are well aware that the only real way to draw in new customers is to attempt to increase brand loyalty (which is almost always cheaper to do through advertising than through improving their services).

Since they're aware that many of their customers are emotionally invested (or as is the case for cell phone companies, contractually obligated), they can easily get away with practices such as raising their prices, removing options and limiting usage, and there's not much of anything anyone will be able to do about it. Airline companies have been continually raising their rates and increasing fees on every minor thing ever for the past 10 years. Cell phone companies have been increasing their costs and slowly limiting what users are allowed to do with their services more and more lately. ISPs want to create tiered networks at slower speeds rather than compete to improve network quality and speeds, while still raising monthly rates.

 

[darkdog]

I wasn't aware doing your hair or driving a taxi had a dearth of competition. Not arguing necessarily in favor of licensing, but that doesn't exactly support your point.

Sure it does. I guess I had this column in mind when I wrote that: The Cancer of Regulation by John Stossel on Creators.com - A Syndicate Of Talent

The point is the barriers to entry are made artificially high in some places. There's no reason for such restrictive regulations except as a tool for established businesses to use the force of government to lock out competition.

The three specific industries I've mentioned so far - airlines, cellular providers and ISPs - do not have to compete with each other. When you're providing a service that most people consider necessary (as almost all of those except for possibly airlines generally are), and there are a grand total of two, maybe three options in an area for that service, both companies are well aware that the only real way to draw in new customers is to attempt to increase brand loyalty (which is almost always cheaper to do through advertising than through improving their services).

Since they're aware that many of their customers are emotionally invested (or as is the case for cell phone companies, contractually obligated), they can easily get away with practices such as raising their prices, removing options and limiting usage, and there's not much of anything anyone will be able to do about it. Airline companies have been continually raising their rates and increasing fees on every minor thing ever for the past 10 years. Cell phone companies have been increasing their costs and slowly limiting what users are allowed to do with their services more and more lately. ISPs want to create tiered networks at slower speeds rather than compete to improve network quality and speeds, while still raising monthly rates.

A company may be able to get people to try their product with good advertising, but it takes a lot more than that to keep them coming back. People aren't stupid and these companies know that. Companies only wish they could win that kind of loyalty so easily, but they know it's impossible, so they have to keep trying to beat their competitors. Even in the cell phone market where contracts are involved, they know customers can always go look elsewhere once the contract's up or use pay-as-you services.

Let's look at your three examples.
Airline companies- The reason they've been raising rates and increasing fees over the past 10 years is that they've been very unprofitable for most of the past 10 years. First, they survived 9/11 and then oil prices went through the roof. For all the nickel-and-diming they're doing, it's still wasn't enough to cover the cost of business. I remember in 2008 when gas prices were heading towards $4/gallon and airlines started charging for luggage. Southwest managed not to do that because they had bought several years of fuel before prices went up. They advertised that like crazy. That's competition at work. And as much as I like Southwest and feel some loyalty to them, if I see an American Airlines flight for cheaper, I'll take it.

Cell phones- You complain about limiting options and I have no idea where you get that. Just ten years ago, all you could really do with cell phones was call people and text. Nowadays, you can use them to take pictures, record videos, surf the net, download apps, and even watch entire movies on demand, all with improved coverage from nearly every corner of the country. If you're talking about limiting data usage, well yeah, that's made necessary by all the options that have been added over the years. People didn't use to use gigabytes of bandwidth every month like they are now and bandwidth is not free.

Internet- It's a contradiction to simultaneously complain about tiered services and lack of options. If you want really fast internet for gaming or watching movies, you can get it in most places if you're willing to pay. However, if you're just interested in checking email, looking up the occasional website, and yapping on forums, you're probably better off getting the slow internet and paying less. Heck, I use the slower service and I have no trouble watching movies or doing whatever. Like cell phones, internet usage has increased exponentially over the years and people use far more bandwidth than they used to. It was estimated that in 2007, YouTube alone was responsible for more internet traffic than the entire internet in 2000, and it's only exploded since then. Yes, my internet bill has increased some, but it's been pretty modest, especially considering all that.