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Monopolies and Antitrust

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Last night, at the weekly meeting of my university's philosophical society of which I am the vice-president, we discussed the issue of antitrust law and monopolies. Our reading for the meeting was Alan Greenspan's Antitrust from Capitalism: The Unknown Ideal (I am in charge of choosing the readings for the meetings, hehe).

An interesting question came up that I am struggling to find a proper answer for. In the meeting, I clearly made the case that in a capitalist system, there would be no overlap of economic power and political power, and that a coercive monopoly can only exist by government force. I specifically stressed the definitions of economic power and political power and how they are separate in capitalism by definition; the distinction between coercive monopolies and non-coercive monopolies; and most importantly, that a non-coercive monopoly, no matter how much economic power it may have at a given time, can not set its prices independently of the market.

Through Greenspan's article as well as my own arguments, I convinced everyone there that under capitalism, coercive monopolies could not exist. However, a problem arose that I was not able to answer fully. The objection was essentially that a company could amass so much economic power that it could maintain control of the market at a low quality product and a high price. That is not to say that such a company could FORBID the possibility of future competition, but rather that a given company would have so much economic power that it would be close to impossible for any company to successfully defeat that strong company in competition. The result of this, according to the objection, would be a drastic decrease in efficiency in that given market; efficiency being a steady increase in product quality and decrease in product price.

In response to this objection, I maintained that even such a company would not be able to set its prices independently of the market. If they charged too much for their products at too low of a quality based on the demand of the consumers, they would begin to lose revenue and would have to act accordingly to increase their quality and lower their prices if they wanted to maintain their success. Regardless of how much economic power a given company has therefore, they still have to answer to the conditions of the market.

However, it still seems that a company with a large amount of economic power (examples given were Microsoft and DeBeers), would be much more resistant to the conditions of the market than a much smaller company would.

Essentially, it was concluded that while I had given an excellent moral justification for capitalism (based on the conception of rights that I gave, etc.), I had not demonstrated that the free market is the most efficient economic system.

While I believe that history clearly demonstrates the efficiency of the free market, I am struggling to give an adequate answer to the charge that a large amount of economic power centered in one company drastically decreases the efficiency of a market.

Any ideas would be appreciated!

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Two things:

1. How would a company essentially prevent competition if it had a product that was lower quality and higher price than 'the market' (ie potential purchases) wanted?

2. You assume that competition occurs in only one venue. For instance, one person corners the market on oil, providing only low quality at a high price. If there were no other means to acquire oil, then consumers and manufacterers would look to other commodities (coal, hydrogen, etc) for their energy or other currently oil-based needs.

In other words, there is no way for a company to get a price for a product higher than someone is willing to trade for it.

--

As an aside, I might ask what your definition of efficiency is, why you are apparently seeking to justify capitalism on that basis, and what system you would be comparing it to in which that definition is also applied (more efficient than WHAT?)

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I'm no economist, but I think the easiest error to point out is that people must choose to buy from the super-corporation. If they are offering a poor product at a high price, and someone else starts up a company to compete, it doesn't matter what the super-corp does to squash competition--if the consumers realize that after they do, the corp will go back to selling crappy, expensive products, then they will choose any other alternative.

In short, consumers can think long-range, and make decisions accordingly.

I also think there are some more technical errors in the argument. I think a larger company would probably be more, not less sensitive to market conditions. They control a larger portion of the market, after all, so if it fluxuates, the effect is dramatically greater. Also it seems like larger corporations would have to be unbelievably efficient, since investors would always be looking for more efficient competitors, and smaller companies tend to be more efficient. I can't support these points with detailed historical arguments, but they make logical sense.

Also there seems to be something about innovation that is neglected. Say, for example, some one company controlled the entire power, water, transportation, and food industries. Their size won't help them if a John Galt comes along and discovers a new, better, cheaper method of power conversation, or if a Henry Ford comes along and invents a flying car, etc.. Markets are never stagnant, and I find it difficult to see how a corporation could have a "monopoly" on innovation.

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Two things:

1.  How would a company essentially prevent competition if it had a product that was lower quality and higher price than 'the market' (ie potential purchases) wanted?

2.  You assume that competition occurs in only one venue.  For instance, one person corners the market on oil, providing only low quality at a high price.  If there were no other means to acquire oil, then consumers and manufacterers would look to other commodities (coal, hydrogen, etc) for their energy or other currently oil-based needs.

In other words, there is no way for a company to get a price for a product higher than someone is willing to trade for it.

--

As an aside, I might ask what your definition of efficiency is, why you are apparently seeking to justify capitalism on that basis, and what system you would be comparing it to in which that definition is also applied (more efficient than WHAT?)

RadCap,

1. Take Microsoft. They have consistently offered a high quality product at a low product and have achieved a high level of economic power. The objection made to my comments was that once this high level of economic power is achieved, it would be easy for such a company to defeat its competition without having to specifically be concerned with providing a high quality product in the long-run. For example, say that this hypothetically company drastically reduced its prices long enough to eliminate the competition, then raised prices again once the competition was eliminated. The idea is not that Microsoft would be able to do so if they had a lower quality product and a higher price than the competition, but that no company could reach the point of having a higher quality product at a lower price because of the amount of economic power Microsoft has.

2. Please keep in mind that this is not my argument, but the objection that was presented to me. I agree with you in this instance. In fact, the argument you just presented was my argument against one of the counterexamples they presented to me, the DeBeers corporation.

As to your aside, again, keep in mind, that this is not MY argument, but rather the argument presented to me by the people I was discussing this issue with. Therefore, I am not trying to justify capitalism on these grounds (in fact, as I said in my last post, I concentrated on a moral justification of capitalism in my arguments). As to their definition of efficiency, I took it to mean the idea of a steadily increasing quality of product and lowering of price that history has seen in many different markets under capitalist economies.

So their objection, essentially, was that if there was no protection against non-coercive monopolies, the great practical benefits of capitalism demonstrated by history would be harmed.

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I'm no economist, but I think the easiest error to point out is that people must choose to buy from the super-corporation. If they are offering a poor product at a high price, and someone else starts up a company to compete, it doesn't matter what the super-corp does to squash competition--if the consumers realize that after they do, the corp will go back to selling crappy, expensive products, then they will choose any other alternative.
Matt,

The idea behind their objection was that no other company would be able to provide a higher quality product and a lower price than the "super-corporation."

I also think there are some more technical errors in the argument. I think a larger company would probably be more, not less sensitive to market conditions. They control a larger portion of the market, after all, so if it fluxuates, the effect is dramatically greater. Also it seems like larger corporations would have to be unbelievably efficient, since investors would always be looking for more efficient competitors, and smaller companies tend to be more efficient. I can't support these points with detailed historical arguments, but they make logical sense.

I'm not sure that I understand this argument, could you elaborate on it?

Also there seems to be something about innovation that is neglected. Say, for example, some one company controlled the entire power, water, transportation, and food industries. Their size won't help them if a John Galt comes along and discovers a new, better, cheaper method of power conversation, or if a Henry Ford comes along and invents a flying car, etc.. Markets are never stagnant, and I find it difficult to see how a corporation could have a "monopoly" on innovation.

I think this is a very good point. However, is it possible that they could counter that it is more likely that the super-corporation will be the one to innovate because they have so many more resources at their disposal?

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I think this is a very good point. However, is it possible that they could counter that it is more likely that the super-corporation will be the one to innovate because they have so many more resources at their disposal?
To some extent, I agree. Just as some people happen to be born with rich parents who give them a head start, so will past success, the bad judgment of customers, and pure chance give some people and some companies an unwarranted advantage over its competitors. But as RadCap pointed out,

what system you would be comparing it to in which that definition is also applied (more efficient than WHAT?)

If capitalism is not the “most efficient” system, then the arbitrary redistribution of wealth by governmental coercion is better, right? Of course not. A is A. Just as a fool will quickly part with his money, so will an incompetent corporation. Governmental intervention of any kind guarantees only one thing: that the corporations with the most pull will get the wealth created by others.

Capitalism is not a “perfect market” in the sense that everyone automatically knows which action will be the most efficient – because human reason is not automatic or infallible. Substituting the judgment of a bureaucrat for that of the individual cannot change that. However capitalism is a “perfect system” in the sense that it is the only system that allows every individual to act according to his own judgment – and as such, it is more efficient than any possible alternative.

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Unfortunately, I can't elaborate a whole lot on any my arguments. I probably shouldn't have tried in the first place. My economics is very shaky.

I think the first one still stands: no corporation can be sustained without the sanction of its consumers. Alright, I guess maybe you could come up with an absurd situation: one corp owns all land that could possibly produce anything nutritive, and charges high prices for it, and when people try to boycott they just starve. I don't even know what I would begin to say if someone offered that as an argument. I can't refute it, but I suspect its getting dangerously close to the arbitrary.

And yes, I think the super-corp would be more likely to innovate, all things being equal. But the corp certainly doesn't have any guarantees. (All things are never equal ;) )

I meant to say this last time, but I forgot: I think you should be congratulated for convincing a group of philosophically inclined students that capitalism is the most moral system, even if they aren't convinced of its practicality. I had to be convinced capitalism was the moral system for a long time before I understood how things like private roads and government funding could even possibly work.

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What a great question! You found a hole : )

It's important to separate capitalism as a principle and the "capitalism" practiced today. Principalistic capitalism is a very very moral system because it counts on individual as an individual - to each to decide his own worth, and to each the rights to the fruits of his own labour.

Now, in practice it's a whole other ballgame. When I try to think of a Corporation giant that owes its success only to the quality of its products I come up with – well, it’s a stickler. I can think of the quality of an individual product and think it’s popular because of that, but when I think above the product itself to the corporation that made it and put it there on the shelf the story changes. Why do I see this product here on the shelf in front of me and not another? Why do I see this product and the same few others like it everywhere?

A perfect capitalist success story would be someone inventing a product, putting it on the market, and because of its success being able to advertise and make even more products to provide more people and becoming rich as a result. To continue forward a bit, as mentioned above, if the product inventor father gave some of the fruits of his labour to his son to give him a head start in making his own product, it would still be capitalism. The same if one company invested in another fledgeling company to give it a boost.

Things become ‘un-capitalistic’ when the reason for a product’s success is other than its quality. We as consumers are free to choose to buy whatever product we like – but a goal of almost all modern corporations is to maintain and gain success through limiting and controlling those choices.

A monopoly leaves a consumer with no other choice but to buy the monopolizer’s product. The same for advertising, monopolizing advertising space limits the product choices the consumer thinks he has. The bigger a company gets, the more power it has to push to the front or to buy another’s place. Buying tons of advertising and distibution in the interest of the product is Capitalism, doing the same with the goal of eliminating contenders and consumer choices isn’t.

Things have gotten so bad today that many products are described for their ‘market share’, ‘availability’, ‘consumer exposure’ and ‘brand awareness’, not their quality, and their basic goal is obtaining a monopoly. There are even companies that owe their success to their ability to exploit humen weaknesses – Microsoft is a great example. We all know that it’s human nature is to use the tool we have in front of us, and to prefer a tool that we’ve used before, and the MS spin doctors know it better than we. It’s not for nothing that they spent so much making damn sure that the first OS a new computer owner would see is Windows.

Personally I think that any promotional or production tactic used with the intended deriment of a) consumer choice or ;) competitor presence is very un-capitalist. Especially because the quality of the product matters less to those who deal like this.

Inventing a great product for a known need and making millions because it’s good and useful is not only Capitalism, it’s progress.

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I meant to say this last time, but I forgot: I think you should be congratulated for convincing a group of philosophically inclined students that capitalism is the most moral system, even if they aren't convinced of its practicality. I had to be convinced capitalism was the moral system for a long time before I understood how things like private roads and government funding could even possibly work.

I agree. Nice work, Steve. ;) Now if you can just eradicate their soul/body dichotomy, they'll understand that its being the most moral system implies its also being the most practical one. ;)

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RationalEgoistSG Wrote:

The objection was essentially that a company could amass so much economic power that it could maintain control of the market at a low quality product and a high price. That is not to say that such a company could FORBID the possibility of future competition, but rather that a given company would have so much economic power that it would be close to impossible for any company to successfully defeat that strong company in competition. The result of this, according to the objection, would be a drastic decrease in efficiency in that given market; efficiency being a steady increase in product quality and decrease in product price.
It certainly depends on what kind of product is in question. Is it a product that is a human luxury as opposed to a pertinent need? If the product is one that is not a "luxury product" then consumers can choose whether or not to purchase the product. In that regard, the revenues of the company would fall which would make said company want to revise its business practices. What's more, I see nothing that would preclude another individual or company coming unto the market in order to slowly but surely built a customer base that would enable it to become a viable competitor within time.

It must also be noted that most (robust) monopolies are owned in whole or part by either the Federal Government or individual states. I think N. Branden said is best with what follows:

One of the worst fallacies in the field of economics - propagated by Karl Marx and accepted by almost everyone today, including many businessmen - is the notion that the development of monopolies in an inescapable and intrinsic result of the operation of a free, unregulated economy. In fact, the exact opposite is true. It is a free market that makes monopolies impossible.

Can anyone point to a privately own company that has a monopoly or used to have in North America?

While I believe that history clearly demonstrates the efficiency of the free market, I am struggling to give an adequate answer to the charge that a large amount of economic power centered in one company drastically decreases the efficiency of a market. [Efficiency being a steady increase in product quality and decrease in product price.]

An efficient market is one comprised of individuals and businesses doing consensual trading. A market that is controlled by the government is the most inefficient because the government uses coercion in order to bestow blessings on some by taking from others (or restricting the legal activities of others).

As Thomas Jefferson said:

"I would rather be exposed to the inconveniences attending too much liberty than to those attending

too small a degree of it."

My question is how such a company would make itself into an "economic power" possessing a monopoly?

By the way, I am not an economist but as far as I know a monopoly that is not the product of a government can only be achieved (theoretically) by selling quality (& in demand) products at affordable prices. But although I have a fertile imagination I can’t see how this monopoly could arise or be maintained (practically) in a society where there is a seperation between state and economy.

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At this point I would like to recommend Thomas Sowell's Basic Economics as a bit of light reading and, coincidentally, as containing the answer to RE SG's question. Unfortunatly, since I am away from my copy of the book, and as such am having a bit of difficulty consulting it just now, I'll leave this post as book recommendation slash holy grail slash mandatory reading for all.

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1) It's important to separate capitalism as a principle and the "capitalism" practiced today.

and:

2) Things become ‘un-capitalistic’ when the reason for a product’s success is another than its quality.

1) Capitalism is not practiced today. There are no corporations operating today in an economic environment that equals or even simulates one in which there is: no taxation, no regulation, no public property, and in which "market controls" are exerted not only by those who do or do not buy products, but also by those who boycott or ostracize those who buy products of which they disapprove. That is a market that demands the responsibility of thinking from every customer.

Therefore, it is premature for you to assert that there is some distinction between the theory of capitalism and its practice. It is also a fallacy to assert that. The trail to access proof of this statement starts 3 posts above yours. Follow the train of thought in AshRyan's request [there is a thread on the subject running now], and if you can persevere to the end, you will never make that assertion again for the rest of your life.

2) Quality according to whom? It is not the function of capitalism to regulate choices other than to guarantee that they are voluntary. To the degree that buyers are free to choose, the quality of the products they buy will mirror the quality of their thinking. But so will the quality of their government. Consequently, if you could graph the overall quality of products on the market with one line and the overall liberty of the market participants with another, the two lines would lie on top of each other.

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J.M.S., you are in need of an answer, because otherwise I can see you completely rejecting Capitalism.

Information has both value and price.

Business systems have both value and price.

Quality has both value and price.

Quality: Meaning, you can't make a superb-quality finished good and expect it to be the idol of Capitalism. It is not. Information: How are you going to let people know you make it and are selling it? Business Systems: What if you can't fill orders fast enough, or you're in a slump and have overstocked inventory, how do you make or store?

All these questions need answers. Microsoft, McDonald's, any wildly successful company must answer all of these questions well; it's not only about how good it is, it has loads to do with does the customer know? and does the customer get it when he wants it?.

Capitalism requires a person to use his mind. It's all very well to think, how can I perfect this new product idea? - but you are evading (the word raises a red flag here!) all of the other issues involved.

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Respond whenever you want ....

Capitalism as it was meant to be is a social system where every person is free from the initiation of force or the threat of such. In essence, that means people are free from you.

Where I was headed with my previous post is:

A. Letting the mass market know about your product is as much a good as the product itself. Knowledge isn't free: people need to pay simply to find out what's on the market. The cost of purchasing an item is the price of the good itself plus the information that you learned about it.

B. Running a business is no simple endeavor. It's not "Wow, new law of physics! I think I'll build flying cars and sell them now for millions!" It is, "okay, I need to find competent people who've experience in cars, flying, and most importantly starting businesses. I need to raise capital and attract investors. I need to find and buy, rent, or lease some land and build a factory, buy the heavy machinery, and hire a workforce, all before I sell the first unit. Then, I have to figure out how to let people know about my product: tv, magazines, billboards. Wow, this is risky." A similar process affects already established businesses. That is not free! What you are paying for in a good is the competence of the manufacturing plus the competence of the business system.

for sure everything has its value. I'd call that 'worth' - but then one could ask how to measure it - which brings up a good point because the question 'what is a dollar' should be asked more often

You need to read an economics tract, and again I'd recommend Sowell's Basic Economics as a lifelong reference. Everything you're asking about is very well defined.

Now what would you call a system where thoughtless consumption is a norm, where a lack of choice is blindly accepted?

Evidently, the cost of access to information is too high. People would prefer to purchase A without knowing about B because A is suitable and the expected benefit of researching all the Bs outweighs the cost.

the worth of you and what you do or make for others is Capitalism

That includes covering the cost of access to information - advertisement.

I'm not so sure that selling something for more than it's worth is

Do you know anything about the supply curve and the demand curve? Or, getting more technical, what is marginal cost and marginal value? These are the fundamental concepts in economics, and they define what "worth" is. From what I see here, you have no solid definition of your own.

Earning because of someone else's weakness, laziness or stupidity isn't. Making and profiting from an enviroment of stupidity is even worse.

This is the worst part of your post. Who is to provide the masses with information about all possible products at no charge? - Blank out!

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Whoa whoa whoa wait a sec. I don't know what your goal is here.

Again, and I can't stress it more, I agree with you on capitalism! We're both explaining the same thing in different ways. I don't need you and you don't need me but I can choose to hire you or trade you for your something if I decide I need or want it. Capitalism is even-Steven, tit for tat, all along the board. Point finale.

LOL, I think you're just trying to get a rile out of me. No matter, though I don't think much of what you say I think there are many people who do. Shall we continue?

for sure everything has its value. I'd call that 'worth' - but then one could ask how to measure it - which brings up a good point because the question 'what is a dollar' should be asked more often

You need to read an economics tract, and again I'd recommend Sowell's Basic Economics as a lifelong reference. Everything you're asking about is very well defined.

I'm glad that you noted that I am still asking myself questions on this point. The closest I've come is: a dollar is what it was initially traded for. Perhaps another thread on this? No matter. Point taken, I'll read.

Evidently, the cost of access to information is too high. People would prefer to purchase A without knowing about B because A is suitable and the expected benefit of researching all the Bs outweighs the cost.

I totally agree with the second sentence and totally disagree with the first. I hope you're not talking about buying televisions and computers, consumers don't buy them for the advertising - at least, I hope they don't. It's not for the consumer to pay for access to information he doesn't necessarily need; a consumer will look where he thinks he should to to find what he needs. If I have a product to sell it is for ME to pay the price for making that consumer see my wares before or while he needs them. Advertising is all about being the first in the consumer's face, and it's usually the product which manages to be omnipresent or first in line which is first bought. The consumer may pay for the price of that advertising through its cost included in the product, but it is I who pays for it first.

I'm not so sure that selling something for more than it's worth is

Do you know anything about the supply curve and the demand curve? Or, getting more technical, what is marginal cost and marginal value? These are the fundamental concepts in economics, and they define what "worth" is. From what I see here, you have no solid definition of your own.

No, no definition yet. Of the worth of my own work, you mean? I hope you don't. Marginal cost, marginal value? I know what my own profit margins are, it is I who set them. I don't study other people's businesses so I don't know the 'Economics' terms to describe them, but I take care of my own quite well, thank you. My profit margins, probably like any businesses should be, are set as a cushion against eventual loss. When business is brisk, I have a surplus.

Earning because of someone else's weakness, laziness or stupidity isn't. Making and profiting from an enviroment of stupidity is even worse.

This is the worst part of your post. Who is to provide the masses with information about all possible products at no charge? - Blank out!

...here you must be trying to get a rise out of me. Where did I ever say 'at no charge'? Again I say it's not for the consumer to pay for advertising. I think it was quite obvious what I meant, but I will explain again in case it wasn't. When a company not only spends billions on advertising, fine, the potential customer is bombarded but still has a choice. Now, spending billions on researching points of humanity's weakness such as its tendency to clan (go with the flow) without much thought about it and its tendency to (thoughtlessly) misinterpret its habits as its taste (or 'my choice'). Take all these ads which, after watching them, we have an idea what we'd 'feel like' if we used the product, but have no idea what the real merits of the products are. Yes, today we are meant to 'feel', not to think, and again I say that this is the result of an education which began in the early 1830's. Not so long ago in my books.

Blank out? If I wanted to I wouldn't be here.

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Again, and I can't stress it more, I agree with you on capitalism!

You don't, because you describe as un-capitalistic a vital element of it.

<< Evidently, the cost of access to information is too high. People would prefer to purchase A without knowing about B because A is suitable and the expected benefit of researching all the Bs outweighs the cost. >>

I totally agree with the second sentence and totally disagree with the first.

You can't; they say the same thing. It's my style.

No, no definition yet ... worth ... I know what my own profit margins are....

Here, you're talking nonsense. Read a bit: learn the fundamental concepts and jargon.

Where did I ever say 'at no charge'?

You are lamenting as un-capitalistic that people don't know everything, and that the lack of infinitely complete information on the part of all is a cause of a market sector. I lament as uncapitalistic your lament.

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Again, and I can't stress it more, I agree with you on capitalism!

You don't, because you describe as un-capitalistic a vital element of it.

...please elaborate, I'd like to know what that 'vital element' is.

<< Evidently, the cost of access to information is too high. People would prefer to purchase A without knowing about B because A is suitable and the expected benefit of researching all the Bs outweighs the cost. >>

I totally agree with the second sentence and totally disagree with the first.

You can't; they say the same thing. It's my style.

...I don't understand what you're getting at with this, either, I think I was quite clear that 'the cost of information' could only cost the consumer if the consumer chose to buy the product advertised.

Where did I ever say 'at no charge'?

You are lamenting as un-capitalistic that people don't know everything, and that the lack of infinitely complete information on the part of all is a cause of a market sector. I lament as uncapitalistic your lament.

I do lament that ignorant and uninformed people seem to be quite happy being as such, but I never said that had anything about THEM being capitalist or un-the-same. I lament people who make products based on the gullibility of buyers and not for the product itself. Several examples have already been cited in this thread to support this.

Listen, why don't you tell us (or at least me : ) what your views of what 'real' Capitalist business practices are? What do you think an example of an 'un-capitalistic' business is, and please provide some examples for clarity. I can read this or that later, but it would be nice to see your arguments here on the board. After all, I entered this thread because I had a question similar to the opening statement, not because I could answer it. I would like to, obviously, as well as clearing up a few other doubts I expressed earlier. Perhaps you could help. For now, many points on the way are quite clear for me, and it's where they're all pointing that still intrigues me.

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I'd like to know what that 'vital element' is.... I lament people who make products based on the gullibility of buyers and not for the product itself.

Everything you're railing against. People making products that the buyers will buy, instead of preaching to them to buy other things that you the enlightened central planner know are better for them.

I think I was quite clear that 'the cost of information' could only cost the consumer if...

You were very clear and very wrong. The "cost of information" I was describing is the price the consumer must pay to research and gain knowledge, because information is not free. This is not necessarily money paid, but can also be time invested looking through catalogs or leisure forfeited or staying longer at the store to browse or asking the storekeeper what he doesn't currently have in stock. The cost of information is the price paid every time you learn about another product on the market, no matter whether it was fed to you on a billboard or you looked through a catalog.

I do lament that ignorant and uninformed people seem to be quite happy being as such

That is uncapitalistic. People are rational, right? (Objectivists, nod your heads....) That's the fundamental tenet of Capitalism. If they choose to stay ignorant, that means getting educated is too expensive or not worth the risk.

but I never said that had anything about THEM being capitalist or un-the-same

No, because lamenting them is being anti-capitalistic. Here, I am assuming you don't simply have a personal preference for an educated populace, but a fundamental problem with an uneducated one (the education discussed being all from your perspective).

What are your views of what 'real' Capitalist business practices?

Anything people want to do, as long as laws are objectively defined, government is and is only in existence to quash initiation of force or the threat of such, and people deal with each other as traders not looters, with persuasion not force. Other than that, anything goes, and (a touch of Objectivist morality here) please everyone use your minds and your capabilities of reason to your personal benefit.

What do you think an example of an 'un-capitalistic' business is

One that is unregulated.

I can read this or that later, but it would be nice to see your arguments here on the board.

And this is totally unrelated to examples of Capitalistic business practices, having more to do with having a basic understanding of the economics fundamentals and jargon. The point is, you need an economics book, or if you like the free stuff an economics website. I have no idea how to write up a chapter on the fundamentals right now; but since many such are already written, the ball is in your court. Go for the free stuff, or visit Amazon; my personal recommendation is ... and you've heard it already.

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I'd like to know what that 'vital element' is.... I lament people who make products based on the gullibility of buyers and not for the product itself.

Everything you're railing against. People making products that the buyers will buy, instead of preaching to them to buy other things that you the enlightened central planner know are better for them.

...now I know you're taking the - whatever. Again you misunderstand, I never strayed from what corporations do to be the first in the lineup of products potential consumers see; I'm not concerned with and never mentioned how much any category of people spend to find what they want and how much it costs to find it. People who search are thinking people and do quite well without me worrying about them, thank you.

People in general can be any way they choose to be (within their limitations), they learn their trades and worry little about anything outside of that and their family/social life: this is normal, one can't be expected to strive to (or assume to) know everything (I hope I didn't sound like I was considering to the contrary). The above 'family man' which makes up the majority of the world's population will have his ignorances. Computers were a number one ignorance to people in that category over the last generation; One company of note made it big from exploiting that ignorance without ever making a fully functional and innovative product - and because of it went without success until they managed to get computers using a certain microchip to ship with their buggy OS installed in it. What's even funnier is that the majority of the OS's first users continued buying the next versions because they chalked its problems up to - their own ignorance. One major case, yet the most major. I still hesitate to call that anti-trust though, that sort of manipulation is still undefined in today's laws and I think that whoever's accusing is off the mark.

I deplore something but I can't precisely say what it is yet. Something to do with defining the value of a product (the currency spent to make it) and the currency exchanged to buy it. Something about pricing something beyond its real worth with only a money-making goal as a reason. There's something parasitical there because when you take more than your worth, then, in one way or another, the person you take from is losing out. Overstepping the line just a bit is generally accepted as 'trying to get a good deal' - but today this can only generally be applied to person to person trading. With the imposed prices of our mass distribution products we don't have a chance to counter them. By not buying it perhaps, but for already widely-used-and-incompatible-with-other-system-software? Yes, that again. I suppose I could say the same of petrol and motor cars, look at the billions few are making by buying cheap oil from (often despotic) third-world countires and selling it at high prices - to people who have almost no other choice of transportation than petrol-run motor cars. Oh yes, the system's regulated - to keep the system from changing for as long as possible. Yet it is anything but Capitalistic.

[added] BTW, Goodnight : ) [/added]

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You know, you can ask the mods to change the title of this thread to Micro$oft is Evil.

Bill Gates of Microsoft made it big by being an excellent businessman. Perhaps the product wasn't superb (we'll leave that to individual analysis here, because I happen not to mind his products terribly much; I use IE and XP and .NET by choice) and perhaps none of his ideas were original. However, the business systems that Bill Gates built were phenomenal, every aspect about his business operations lent themselves to marketing his products efficiently, en mass, at little cost and high profits for all concerned including the buyers - and that is as big a deal as the finished good. That concept is not going away, and when you ignore it I call it evasion.

You deplore something based on your emotions; that explains why everything is fuzzy and ill-defined for you. Let your mind and your reason see the light now. Research the basics of economics from any conservative/libertarian sites you come across and seek out Thomas Sowell's writings, because you cannot continue to debate things you formally know nothing about, and it's even worse when you have (mysticist) feelings involved.

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The only thing emotional about this thread is annoyance at feeling obligated to answer your picking apart what you choose not to understand in my posts. Who said this was a debate? Do I need to pass an exam to speak my mind?

I'm sorry, but I don't see what your goal is by posting replies to my posting. I have a few questions and inquietudes about a subject that is of little concern to my everyday affairs, so I forward my thoughts as they are in the hope that someone better enlightened or at least others thinking on the same lines can give some input. You have done nothing of the kind - if you'd rather pretend to be wise and keep your thoughts to yourself then you won't be helping me or anyone else a bit. If you think me a 'naive amateur' and don't want to fill me in you don't have to answer, and the same goes for anyone else reading this thread.

But yet what you say intrigues me - does everyone really think that 'being a Capitalist businessman' is making profit by having the ability to dupe an ignorant public into buying a low-qual product? That is capitalism? Can that be considered a 'skill' thus labour? I don't think so.

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I think I understood your posts pretty well, thank you: you don't like evil greedy capitalists who use means other than a resume and a factsheet in trading with others but you have no idea why.

Yes, you do in fact need to pass an exam to speak your mind. No, we're not going to force you, but Objectivists are not the kind of fourth-grade teachers who let any opinion "out there" because otherwise the kids' self-esteem will drop.

We are/were talking about economics. I was trying to at any rate, and you had no idea what I was saying. I asked if you knew what three terms meant (supply, demand, marginal) and you responded with something (profit margins) that was a. nonsense and b. irrelevant. I cannot be a textbook, and there is a lot to say on the subjects; but I also cannot use them in answering your questions if you aren't comfortable with them. Here, you cannot speak your mind unless you are comfortable with the basics, because nobody is here to build up your self-esteem, but to try it.

My goal in replying is to persuade you why your conception of Capitalism is all wrong, and why it could lead you into collectivism very easily. (It being a value to me that there are more Capitalists and fewer collectivists, and it being a value to me that I refine my knowledge through debate.)

Perhaps it would indeed have been better for your self-esteem had I used a different approach, perhaps more patient and understanding. But I didn't. That doesn't give you the excuse to call my knowledge of a subject you know nothing about inadequate.

You had expected to converse with somebody who thinks on the same lines as you do; as I hope I have made clear, very few here think as you do. Check out ARI's (Ayn Rand Institute) defend Microsoft crusade to find out why. From my knowledge, I am under the impression that your lines of thinking are antithetical to Capitalism economically, and to Objectivism morally, and for the two reasons above I want to persuade you of such.

Whether or not I consider you a "naive amateur" has had no effect on whether I attempted to fill you in. Only, I gave you a viewpoint completely opposite yours. Either way, I did fill you in, and in case you haven't understood from my posts, Microsoft is an example of the moral and Capitalistic way to do business.

And yes, everybody thinks that being a Capitalist businessman is making profits by having the ability to persuade people to buy one's products. Whether they are in your opinion low- or high-quality, or whether the public is in your opinion ignorant or educated, is of no concern; the only caveat is, no initiation of force, no murder, theft, etc., by any party.

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Alright, point(s) taken. I perhaps am asking questions whose answers are already evidence for most of you; what I was hoping for, if I am thought wrong, was insight as to why. My hesitation to pronouce certain subjects tems from the fact that I've never really thought about it to any depth, probably like most everyone in the world. It's not giving me credit for wanting to change that that 'hurts' my self-esteem. I was disappointed at your misunderstanding of my intentions and propos but I've never made any accusation of 'not knowing' anything. As far as myself is concerned you can leave 'feeling' and 'mysticysm' aside, I follow nothing of the sort - the facts I am aware of point in a certain direction and I'm using them to think my way forward. Rand's works have rung a lot of bells in my head and even affected my life from a very early age, and though her lessons have served me well and have even become an integral part of my own thought processes about my own life, here I try to apply them to a greater number - the world, if possible. I thought that one of the basic reasons for this place was making Objectivism accessible to 'outsiders' - if this place is in fact for those seeking to be (or who are) professional philosophers then it's true that I have no place here.

But enough on that. As far as I've understood so far you define companies such as Microsoft as being even a definition for Capitalism. This wouldn't be so bad if people, on the other hand, were less hesitant to think for themselves, things would balance out and Microsoft would be obliged to better its product. Perhaps it all comes down to a question of balance. Anyhow, that's more knowledge then I came here with.

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Good, that AR has influenced you to think different. What I am warning you of is a serious reservation to her philosophy you still have, a contradiction that means you have to check your premises.

This bulletin board is a place for anyone who is interested in Objectivism, wants to debate, and has a strong stomache. This place is not an outreach forum - that is a different thing with very little debate and a lot of "official" literature. You certainly have a place here; nobody (to my knowledge) has decided to kick you out. This place is for anyone who wants an interactive education like they had a century ago, when nobody was afraid to contradict and correct an error.

I said, Microsoft was the perfect example of what Capitalism is. I meant, nothing Microsoft does is in contradiction with the philosophy. Take it or leave it, but the Objectivist loves Micro$oft and is especially pleased when people spell it with a dollar sign.

Lastly, I have no idea what you meant by a question of balance.

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