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For several years I've been dipping into the subject of rising inequality, usually in book reviews like this one of Hacker and Pierson's Winner-Take-All Politics. But all along a mystery has been nagging at me, and I think I'm finally getting to the bottom of it.

It's not just taxes or education or globalization or any of the usual suspects. Monopolies and near-monopolies, and the opaque markets that make them profitable, are the factor we hardly ever talk about.

[from The Weekly Sift]

Inequality. The basic story is simple: Inequality in the United States has risen dramatically since the mid-70s. And the effect gets more extreme the farther out you go. It isn't just that the top 10% is pulling away from the bottom 90%. The top .01% is pulling away from the top .1% even faster. The multi-billionaires are pulling away from the mere billionaires. (If you want graphs and numbers, look here.)

Obviously you can't account for all that with education or competition from China. Maybe those factors explain why unskilled workers are having such a tough time, but they say little about the millionaire/billionaire divergence. Ditto for tax rates. Sure, the rich pay a much lower tax rate than they used to, but the explosive growth in their net worth is much bigger than tax rates can account for, and the mega-rich don't get a significantly better tax deal than the ordinary rich. (Plus, tax cuts start with Reagan in 1982, not the mid-70s.)

Clearly something has happened to the structure of the market, but I couldn't figure out exactly what.

Monopoly. Barry Lynn's book Cornered: The New Monopoly Capitalism and the Economics of Destruction looks like the puzzle piece I was missing. Lynn claims our economy is now full of monopolies and near-monopolies -- businesses big enough to dictate terms to their customers and/or suppliers.

In the mid-20th-century industrial economy, you got mega-rich by imitating Henry Ford: You figured out how to make things people wanted for a price they wanted to pay. Now you get mega-rich by building choke-points between producers and consumers.

WalMart exemplifies the current paradigm. WalMart makes nothing, but it is big enough to dictate how its suppliers will make things and what prices they can charge. In many of its rural markets, WalMart also dictates what people can buy. If your product isn't on WalMart's shelves, it's not for sale. (WalMart also drives consolidation elsewhere in the economy, which produces big fees for Wall Street. For example, Procter & Gamble bought Gillette largely to improve its negotiating position with WalMart. In slightly different ways, Amazon and Google are trying to duplicate the WalMart model in the online economy. If your book isn't on Amazon, it's not for sale.)

Many near-monopolies are less visible than WalMart or Amazon. Lynn begins his book with the story of a pet-food recall, which suddenly made it obvious that many "competing" brands of pet food were actually all packed in the same factory. And Ford lobbied for the government bailout of "competitors" GM and Chrysler because it feared their common suppliers would go bankrupt. Many markets, Lynn says, are hydras: The countless brands on the shelves are just heads that spring from a common body.

The ends against the middle. Reading Lynn, I'm getting a clearer vision of how markets work. The purest form of market is what you can see at any big farmer's market: Lots of consumers dealing directly with lots of producers. It's rare that anybody gets really rich from these interactions, but many small producers have a chance to make a living and become independent.

Obviously the global economy has to be more complicated than that. But markets are created by rules, and the rules can be structured to favor either the ends (producers and consumers) or the middle. Producers and consumers benefit from transparent markets, where the rules force middlemen to treat everyone more-or-less the same.

But markets can also be structured to give middlemen as much freedom as possible. The most profitable way to use that freedom is to create choke-points where a toll can be extracted or one producer can be played off against another. In an opaque market, the way to get rich is not to produce things, but to build middleman power that allows you to dictate terms up and down the supply chain. (I don't have space to go into it here, but keeping the internet transparent is what net neutrality is about, and why Comcast doesn't like it.)

In a nutshell, what has happened since the mid-70s is that deregulation of old markets and under-regulation of new markets has made our economy more opaque. The people in the best position to take advantage of this are the very rich. Meanwhile, workers and small businessmen -- the middle-class people who actually make stuff and deliver services -- lose out. In the short term consumers may win or lose, depending on whether the middlemen's advantage is in raising or lowering prices. But in the long run consumers lose options, power, and quality.

The most interesting thing politically is how the rhetoric of freedom works. Freedom for the middleman leads to domination of producers and consumers. "Freedom" seldom works out to mean more options for everybody.

One worked-out example. If you've watched much cable or satellite TV lately, you probably saw Viacom's ads against DirectTV, like this one.

If you're a DirectTV subscriber, Comedy Central (and other Viacom channels) went dark for nine days before the two corporations resolved their dispute, so you had to do without The Daily Show or watch it online.

Here's the point: Maybe you couldn't watch Jon Stewart for a week, but the problem had nothing to do with either you or Jon Stewart. He wasn't asking for a raise; you weren't balking at the price of watching the Daily Show. But both you and Jon were irrelevant when two giant middlemen had a power struggle.

Each brought a lot of power to the struggle. In most of its markets, DirectTV is the only alternative to the local cable monopoly, while Viacom is one of a handful of megacorps that dominate TV content. (Disney, Time Warner, NBCUniversal, NewsCorp, and CBS are the others. National Amusements owns a big chunk of both Viacom and CBS. Comcast plays both sides of the street, being both a cable monopoly and a partner with GE in NBCUniversal.)

Viacom thought it had the upper hand, so it was demanding a bigger payout from DirectTV and insisting DirectTV carry its new Epix channel. I haven't sorted out yet who won.

These middlemen outweigh both you and Jon Stewart. If Jon doesn't work for one of the six big media companies, he can't reach a major audience. If you don't deal with either DirectTV or a cable monopoly, your TV choices shrink considerably.

Transparent markets. But it's not hard to imagine a TV system that works differently: Cable or satellite systems could be common carriers, making a fixed amount whenever they connect a TV producer with a TV consumer. Cable and satellite would still compete, but only by changing that fixed amount or by offering more reliable service to the consumer.

With that kind of middleman transparency, small TV companies could spring up and get their shows seen, so Jon Stewart would have a lot more than six choices. You and Jon would have more power, Viacom and DirectTV less.

Even more interesting is what happens to the profit motive: The way to make money in this transparent system is to create shows people want to watch and deliver them reliably. Wheeling and dealing to amass middleman power wouldn't accomplish much.

Government regulation would probably be necessary to bring this system about, but it would still be capitalism. The marketplace would just be structured differently, so that the benefits and opportunities of capitalism would accrue to producers and consumers rather than to financiers and empire-builders.

Probably this restructured marketplace would lead to more small companies and fewer megacorps, more millionaires and fewer billionaires.

Picture the same transparent-market principle spreading across the economy: More small businesses, more places to look for jobs, greater variety of products, and more opportunity to go into business for yourself. Less inequality.

Originally posted to Pericles on Mon Jul 30, 2012 at 01:00 PM PDT.

Also republished by ClassWarfare Newsletter: WallStreet VS Working Class Global Occupy movement, Income Inequality Kos, and Community Spotlight.

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Comment Preferences

  •  That's a great book. (12+ / 0-)

    I read it too. Conservatives always talk about the free market but that's the last thing corporations want. There's a lot more profit in un-free, monopolized markets.
    From Chapter 4:

    In the last generation, we have been taught to believe in a philosophy of what is sometimes called "free-market fundamentalism." As we noted in the preface, this philosophy is designed not to illuminate real-world phenomena but to hide the real-world use by the rich of such man-made institutions as corporations and the marketplace - and sometimes even our own governments - to seize our properties and our liberties.

    The GOP ... Government of the 1%, by the 1%, for the 1%

    by Azazello on Mon Jul 30, 2012 at 01:13:55 PM PDT

  •  To be fair to amazon: (0+ / 0-)
    If your book isn't on Amazon, it's not for sale.
    If your book isn't on Amazon, it's probably not being published, since they get it from the publisher.  And Amazon hasn't pushed BN, eBay, or a lot of other online sellers out of business.  Heck, they've actually made it easier to buy from other online sellers.

    Occupy the voting Booth!

    by anonevent on Mon Jul 30, 2012 at 01:14:23 PM PDT

    •  To be fair to what's happened: (3+ / 0-)
      Recommended by:
      Bcre8ve, Creosote, cotterperson

      Amazon decimated local bookstores, removing vast sweeps of small business from the marketplace.

      While there are other purveyors of various things, for books, Amazon is king. Borders has fallen. Barnes & Noble may not be far behind.

      Ebay is not primarily a book seller at all.  At least it started as a sort of online garage sale auction.  Now, particularly in the case of cars but for many other products, it is highly commercialized. At any rate, Ebay is not a choke-point, because it allows more producers (sellers) and more consumers (buyers) to come together to conduct a transaction.  

      And Amazon increasingly competes for sales of all types of products, rather than just books.

      The statement that a Book may not be For Sale if it is not sold on Amazon may not literally be accurate, but practically speaking in the real world marketplace, if your book cannot be sold on Amazon, it will not sell in large volumes. I wish that weren't so.

      "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

      by YucatanMan on Mon Jul 30, 2012 at 08:17:05 PM PDT

      [ Parent ]

    •  Unless (0+ / 0-)

      they don't want it published.

      What better way to censor books than to have only one or two booksellers?

      As you said, "If your book isn't on Amazon, it's probably not being published..."

      More accurately it should be, "If your book isn't on Amazon, it's might as well not being published.

      "One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors." - Plato

      by Bcre8ve on Mon Jul 30, 2012 at 10:16:09 PM PDT

      [ Parent ]

  •  Walmart is a monosopy (13+ / 0-)

    Or "sole buyer". Usually it's entities like government that fulfill this role. As an extreme example fighter jets are solely bought by the governments. But WalMart has become such a dominant purchaser of consumer goods they can now dictate the pricing of those goods. It's become known as "the WalMart price". If you want to sell X to them it will be for Y price or they won't buy it. Which pretty much forces you to produce your goods in country Z with cheap labor and little or no regulations.

    Many people thought Bush was "the kind of guy you wanted to have a beer with". People are beginning to realize that Romney is "the kind of guy you want to pour a beer on".

    by ontheleftcoast on Mon Jul 30, 2012 at 01:16:51 PM PDT

    •  A company only has to dominate (0+ / 0-)

      market share.  At some point they have sufficient market volume to drive out of the market suppliers who choose not to sell to them.

      I experienced that.  Home Depot became such a dominant force in the hardware industry that there was not enough other business to maintain a company whose product category was regional.  All the little hardware stores (now co-ops) and mini chains did not leave enough sales volume for maintaining a research and development budget and paying salaries for alternative companies to survive.  

      What happens in the case of the mega-giants dominating markets is that the old way of developing products - selling to small retailers and moving up to larger ones as a brand develops - dries up.  It is like baseball without a farm system.  The door to new product ideas dries up both as the alternative ways to market evaporate and the profit margins selling to the big box dinosaurs get squeezed in many cases to next to nothing.

  •  I recall a TV doc from years ago... (12+ / 0-)

    ...and I admit I'm relying on a very hazy memory, a particularly imperfect instrument in my case... but:

    Seems to me that the skinny on how it came to be that Rockefeller became an unassailable monopolist of America's oil industry was that his vice-grip was only accomplished when he bought up the railroads that delivered the oil from source to the market, and by being able to carry his own product cheaply while over-charging his competitors to carry theirs, he drove them all out of business or into a buy-out deal that favored his Standard Oil.

    In other words, Rockefeller became a monopolist by taking control of the "middle."

    Interesting observation, Pericles.

    In a way, the Finance Industry serves as a "middle"-type player since all products become monetized and traded through few hands, the way markets are structured these days... .

    •  if I remember right (7+ / 0-)

      Rockefeller was even sneakier than that. He reached a point where railroads needed his traffic, so he controlled them without owning them.

      Does anybody know if that's true?

      Read the Weekly Sift every Monday afternoon. http://weeklysift.com

      by Pericles on Mon Jul 30, 2012 at 01:34:31 PM PDT

      [ Parent ]

      •  Wikipedia, under (4+ / 0-)
        Recommended by:
        basquebob, banjolele, semiot, cotterperson

        Standard Oil or  John Rockefeller gives a good synopsis.

        Short Answer: price fixing, favorable rates and other practices were intended to enrich Rockefeller companies and weaken competitors.

        Undeterred, though vilified for the first time by the press, Rockefeller continued with his self-reinforcing cycle of buying competing refiners, improving the efficiency of his operations, pressing for discounts on oil shipments, undercutting his competition, making secret deals, raising investment pools, and buying rivals out. In less than four months in 1872, in what was later known as "The Cleveland Conquest" or "The Cleveland Massacre", Standard Oil had absorbed 22 of its 26 Cleveland competitors.[32] Eventually, even his former antagonists, Pratt and Rogers, saw the futility of continuing to compete against Standard Oil: in 1874, they made a secret agreement with their old nemesis to be acquired. Pratt and Rogers became Rockefeller's partners.
        Sounds sorta like Walmart, doesn't it?  Substitute telephone monopoly companies, "entertainment" companies, etc, for Walmart and it still holds true.  

        Whatever happened to anti-trust legislation which kept "the middle" competitive and limited its' power?

        "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

        by YucatanMan on Mon Jul 30, 2012 at 08:26:16 PM PDT

        [ Parent ]

  •  I recently had an experience that echoes your (8+ / 0-)

    point.  I'm a lawyer and was reviewing an engagement letter from an investment firm my client wanted to hire to help it sell a - relatively small - company.  The letter was grossly unreasonable in two respects:  (1) how they would calculate the value of the company being sold, and (2) how my client was expected to indemnify them even if they were grossly negligent.  Long story short, we got on the phone with them and pointed out these issues, and their response was "everyone does it this way."  Indeed, everyone does do it that way - in essence, the financial sector is so cartelized right now, they all use the same unfair legal documents and people have nowhere else to turn for services.  The same is true for swap (derivative) agreements and the like.  I believe this is called a tacit cartel - they are not expressly colluding, but it is a small club and everyone wants to belong, so they move pretty much in lockstep.  I see this all the time with the same legal documents regardless of the players' identities.  These folks squeeze out real, meaningful choice.  I do think this partly explains how the financial sector, in particular, has become so very oversized relative to the rest of the economy.

    Antitrust law has not really been enforced for decades.

    Hey, Republicans, the whole world is watching.

    by TAH from SLC on Mon Jul 30, 2012 at 03:58:57 PM PDT

    •  Time for Trust-Busting! (4+ / 0-)
      "Antitrust law has not really been enforced for decades."
      You are correct.  It isn't that we don't have laws that address the size, scope, and ability of corporations, or that there are no laws against collusion and price-fixing - we just aren't able to get the many Attorneys General and Prosecutors to hold their buddies accountable.

      We now have our regulators and law enforcement, rather than viewing the relationship between themselves and big money as being fundamentally one of conflict, referring to those they regulate and police as their "customers" and telling them they set the rules.

      What we need now is another "Trust-buster" like Teddy Roosevelt (or Ronald Reagan, for that matter), who will go after these entities and hold them accountable.  They understood, and were able to explain to the public, why these companies and what they are doing is causing pain for the rest of out society.

      "One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors." - Plato

      by Bcre8ve on Mon Jul 30, 2012 at 09:22:10 PM PDT

      [ Parent ]

      •  Not so sure about the Reagan bit, but otherwise (0+ / 0-)

        I agree.

        Hey, Republicans, the whole world is watching.

        by TAH from SLC on Tue Jul 31, 2012 at 09:04:03 AM PDT

        [ Parent ]

        •  The telephone (0+ / 0-)

          monopoly was broken up under Reagan and "Ma Bell" became the "Baby Bells".

          If Saint Ronnie makes the list, its only because nothing has been done since his time.  It is only as an illustration of how lame enforcement has become, and how much worse the regulatory process is, that I included him at all.  

          Good  catch.

          "One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors." - Plato

          by Bcre8ve on Tue Jul 31, 2012 at 04:32:44 PM PDT

          [ Parent ]

  •  Another big "middle man" is (6+ / 0-)

    the ownership of natural resources.  "Owning" things like broadcast spectrum, mineral rights, or just surface rights to the earth produces nothing.  It merely places the holders in the position of squeezing anyone who wants to use the resource.  And it doesn't matter if the using party also owns the land; the result remains concentration of wealth into the parasitic takers.   The obvious answer has been known for a long time:  Shift the taxes onto monopolies of all kinds while eliminating taxes on labor.  Things would even out in a hurry.

    The Long War is not on Iraq, Afghanistan, or Iran. It is on the American people.

    by Geonomist on Mon Jul 30, 2012 at 04:21:39 PM PDT

    •  "Privatization" of water rights is the thing that (3+ / 0-)
      Recommended by:
      banjolele, cotterperson, mali muso

      really gets under my skin.  Government should be the provider of water for human consumption - accountable to the public - and not for-profit corporations.  

      The right to water is essential to human life.  That sort of thing never should be 'for profit,' just like health care should not be 'for profit.'  

      "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

      by YucatanMan on Mon Jul 30, 2012 at 08:28:31 PM PDT

      [ Parent ]

  •  Community Spotlight is nice... (6+ / 0-)

    ...but this should be on the Rec List.

    imo.

    Don't tell me what you believe, show me what you do and I will tell you what you believe.

    by Meteor Blades on Mon Jul 30, 2012 at 04:46:50 PM PDT

    •  This is the best summary of economic forces (4+ / 0-)
      Recommended by:
      Bcre8ve, banjolele, semiot, cotterperson

      destructively rearranging our market place I've seen to date.

      Monopoly power ends "freedom" for producers and consumers.  "Freedom" for monopolies hurts others.

      Our government made this enormous swing to liberate near-monopoly companies 30+ years ago under Reagan and has yet to reverse course.  We see the obvious implications in our horrible unemployment numbers and continued poor prospects for job improvement.

      Krugman wrote about Saltwater Economics (Keynesians) primarily adhered to on the coasts and Freshwater Economics (Chicago school - "free trade") from Chicago, natch.  

      "Free Trade" only means unleash the monopolies.  It does not mean more choice, more products, higher quality, etc.  

      Freshwater Chicago-school Free Trade undermines economies and takes away choice from the producers and consumers and frees choke-point firms to rake in profits at both producers' and consumers' expense.

      Now, to get that into a sound-bite slogan to persuade the masses....

      "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

      by YucatanMan on Mon Jul 30, 2012 at 08:10:33 PM PDT

      [ Parent ]

  •  I grew up in this: (5+ / 0-)

    More small businesses, more places to look for jobs, greater variety of products, and more opportunity to go into business for yourself. Less inequality.

    Back in the '50s and into the '60s in my small town. My dad had a dime store, where I worked as far back as I can remember. The people who owned the small businesses had the attitude that what was good for the community was good for their businesses. Teenagers worked in the summer and after school, old folks could work to supplement their Social Security, and most people looked after each other.

    We still had some poverty, and a few became wealthy (real estate and building what is now a retirement area). We had a little crime, small groups of gamblers, and enough alcohol so it wasn't "Leave it to Beaver." But it was a good place to live, and people hung together.

    This spring, I was in Durango, Colo., and enjoyed visiting with the shopkeepers. One told me the independently owned businesses have something like a co-op that helps them all. Didn't get the details, but I think it was like putting on events and maybe some volume-based pricing.

    These monopolies are such a disaster for our culture, I hope we can get out from under them some day, but I doubt it. Not as long a five corporations own most of the media and keep us brainwashed. But there are those folks out in Durango .... ;)

    Thanks for the thoughtful and informative diary. "A better world is possible."

    "Let each unique song be sung and the spell of differentiation be broken" - Winter Rabbit

    by cotterperson on Mon Jul 30, 2012 at 05:17:46 PM PDT

    •  Same experience here in the 60s & 70s (3+ / 0-)
      Recommended by:
      banjolele, semiot, cotterperson
      My dad had a dime store, where I worked as far back as I can remember. The people who owned the small businesses had the attitude that what was good for the community was good for their businesses. Teenagers worked in the summer and after school, old folks could work to supplement their Social Security, and most people looked after each other.
      I lived in a small town of 900 people!  We had two (2!) grocery stores. One butchered their own meat.  The other made their own smoked sausages of may type that still would make my mouth water today, if they were available.

      We had a hardware store stocked to the ceiling. A pharmacy complete with soda fountain and hand-made Cokes (one or two squirts of syrup, then fill with soda water). We had a dime store with everything from fabric to plastic models to... everything.  Two (2!) lumber yards.  A bank.  A Plymouth dealer. A weekly newspaper.  A couple taverns (beer only). A bowling alley/pool hall restaurant.  Three other restuarants/Cafes. Four gas stations. A jeweler. Various insurance men.  A one-family dairy - take what you need from the cooler and leave your money in the box on the table. The farmer was asleep after getting up early to milk the cows so the town would have their milk for the day.

      Kids had jobs after school. Older folks had a quiet comfortable place to work or help out. People looked after their neighbors.

      What kept everything going was the large number of smaller farmers in the surrounding countryside. A few big farmers who bought their kids new cars for high school (my class was 20 students!), but the majority were middle income farmers getting by but comfortable.

      Recently, I had the chance to go back and visit. I stayed in the rail-side Hotel where I spent my first night in that town  when we moved there over 40 years ago.  The hotel has been remodeled, but its cafe was not bustling.  It was full, but only due to a reunion from a nearby town without enough rooms.

      One cafe. One grocery store.  No pharmacy. No hardware store. No lumber yard. No car dealer. No gas station! No more smoked sausages. (A few miles away at an interstate exist there was one where there had once been three).

      The small farms had all been consolidated.  Where there were hedgerows, shelterbelts and farm houses, there were now wide open wheat fields on and on, broken up only by county roads.  The population of the town had fallen by about 20% to around 700, but the population of the farmsteads had plummeted about 90-95%!  I literally could not find many of my friends' homes - they weren't there any more - wheat growing over the bulldozed out basements and foundations.

      We've been big-boxed into a trap. We've let choke-points take control of our commerce to the detriment of our nation.

      "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

      by YucatanMan on Mon Jul 30, 2012 at 09:38:50 PM PDT

      [ Parent ]

      •  when I drive home (1+ / 0-)
        Recommended by:
        cotterperson

        My hometown is Quincy, Illinois, a town of around 40,000. It's 100 miles from anywhere, so however I travel, I usually end up driving the last stretch.

        The road goes through lots of towns about the size of the one you're talking about. I see a lot of closed gas stations and mini-marts. Not even that level of commerce works any more.

        Read the Weekly Sift every Monday afternoon. http://weeklysift.com

        by Pericles on Tue Jul 31, 2012 at 04:23:34 AM PDT

        [ Parent ]

  •  Monopolies and manipulating markets is far (1+ / 0-)
    Recommended by:
    banjolele

    from a new phenomena. Always been that way.  Humans will exploit any advantage they can.

    Romney is George W. Bush without brains.

    by thestructureguy on Mon Jul 30, 2012 at 08:03:57 PM PDT

  •  Recommended and hotlisted. An excellent diary (5+ / 0-)

    on complex economics related in a clear and understandable way.  I really admire this type of presentation using examples to explain vast economic change.

    "The law is meant to be my servant and not my master, still less my torturer and my murderer." -- James Baldwin. July 11, 1966.

    by YucatanMan on Mon Jul 30, 2012 at 08:18:17 PM PDT

  •  Excellent Diary! (5+ / 0-)

    This is much more insightful than what I thought I would find:

    A story about how the game "Monopoly" is used to train our children that income inequality is necessary and fun, and that, as a society, it was perfectly acceptable to aspire to become a slumlord that accumulates wealth until the other players lose their homes or become imprisoned and the whole system collapses due to the concentration of wealth into one player's hands, and the only hope that one has after sliding into poverty is to hit the lottery (Free Parking - yes, I know, its not in the rules).

    This diary was much better than that.  Thanks!  ;-)

    "One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors." - Plato

    by Bcre8ve on Mon Jul 30, 2012 at 09:33:47 PM PDT

  •  Great Post. (1+ / 0-)
    Recommended by:
    cotterperson

    So this is why history repeats itself.  We all must learn the same lessons again and again.  Re-fighting the lessons of 1920, adorable.

    Great post.  We need a new trust buster.

    When we talk about war, we're really talking about peace.

    by genethefiend on Tue Jul 31, 2012 at 06:19:42 AM PDT

  •  "but it would still be capitalism" (0+ / 0-)
    With that kind of middleman transparency, small TV companies could spring up and get their shows seen, so Jon Stewart would have a lot more than six choices. You and Jon would have more power, Viacom and DirectTV less.
    Really? Really?

    Small TV Companies would run cable to your house?  They would launch satellites to beam down these shows?

    How would that work exactly?

    Or, would the government own all the "equipment"?

    Just how would this "still be capitalism"?

    Where you go wrong is thinking markets can be "structured", as if some invisible hand sets up the structure before the market even exists.  Markets end up structuring themselves.  You are correct that consumers do not always benefit the most from the structure.  But more often than not, they do.

    But, let's not fool ourselves, government structuring of markets is not capitalism.. not even close.. and except for utilities like electricity and water and sewage, it is almost always a really bad idea.

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