Thread: The Balance between Conservatives and Progressives - Why Consensus is the Next Stage

Originally Posted by snoop

My two cents is that, in a completely laissez faire capitalist free market, even if consumers would only buy the better of the services provided by any business, there is nothing stopping the businesses from, over time, diminishing their quality of service or price gouging. After only so long a successful business acquires enough wealth to either buy the rights to a competitors product or buy the competing company itself. After that, then what? Nothing is stopping this company from either buying the sole right to produce whatever product they are capitalizing and then raising the price of the service or good substantially or lowering their quality of service. If there were no government or copyrights, patents, or trademarks, or if another company were simply to emerge, they would just buy the new company out as well or significantly lower the price of their product temporarily. Because of the larger company's success and wealth, the price cut and lower income would be an acceptable loss compared to losing business to a competitor or even worse the chance that a competitor could become as successful or more so than even them.

Unrestrained capitalism answers to nobody but whoever makes the most money. At least with the government regulating the economy there is someone that businesses and corporations have to answer to, whether or not the government is also taking part in the monopolizing or thinks only in money signs. At least then I have the opportunity to have a say in the matter, along with guaranteed protections or legal compensation for the negligence or utter disregard of some corporation and against inhumane working conditions. When you need a job, you don't quit and look for another with better working conditions--especially if there are no better jobs around. Corporations know you need jobs and could potentially kind of work together by doing little to ensure these conditions to maintain the status quo (which is, making more money). With the head of a corporation being the guy who makes decisions, even if they previously had good working conditions, after becoming a dominant player in the market they could change that any time they wanted. It'd be too late for another business with better conditions to step up because the corporation could simply buy them out. This knowledge could very well prevent any new businesses from even trying to improve work conditions. Hell, a group of the biggest share holders in any given country could team up if they wanted and buy out all the competitors they wanted just so they all stay rich. You scratch my back, I scratch yours. Government officials are at least somewhat accountable for their actions and at least with government regulation so are major share holders and company heads. It's really the lesser of two evils here and government regulation is definitely the lesser evil.

I realize that my arguments hinge on the worst qualities humans have to offer, little to no ethics, and people taking advantage of others, but honestly it's not a huge concern for me because history has already provided all the examples we need. I mean look at what happened in America. The robber barons became so wealthy that honestly without the government stepping in, they could have done whatever they wanted. Unless America's monetary system fails or the government itself fails, the descendants of said robber barons will never have to worry about money, ever. I don't know about you, Blueline or Laughing Man, but I would rather trust the government (wow, can't believe I'm saying that) than share holders. Go ahead and trust the share holders and let me know how it turns out and if it's any better or worse after a century or two. Faith in the human race to do good and to do right by one another on its own is nice to dream about, but is terribly misguided and naive I am rather sorry to say.

Firstly, no company can can "buy" a market unless they get a government mandate. Just like there are economies of scale, there are also diseconomies of scale. It is possible for a business to get so big that they are inefficient and finds itself increasing incapable of producing a profit due to inability to set prices. It cannot communicate properly and since it is the only business (under your example) it cannot dictate the cost/profit margin on the goods it is making because they are the only ones making them. Let us assume that they are making a profit, what is stopping a new company from entering into that market place and not selling their company because they know they can get a bigger market share by simply holding out and out producing (in quality, not necessarily quantity) the mammoth corporation you speak of. On the topic of cutthroat pricing, I don't understand how you can say that a corporation can cut their prices to the level of producing losses yet still grow as if they were profiting. Firstly, that would take them producing more of the product, not reducing production and they more they produce the greater the loss is.

Under unrestrained (freed) capitalist markets, these corporations actually answer to the consumer because in order for a product to be profitable, there is a tendency to mass produce it to the greatest amount of individuals. In order for you to do that you need to make your product abundant to as many people as you can. What the masses want in capitalism is what they get. What insulates these corporations from the mass consumer body is the government itself through subsidies and regulations that either allow corporations to produce products at a price that would be a lose to them but because of the subsidies is a profit which in turn helps to keep new competition out of the system, in an informal regulation. You have no say in government institutions like the FDA or OSHA. You don't vote for bureaucrats or lobbyists and those are the people who write the regulations. You are living under the false notion that you have a say in these matters. You don't. You have some degree of say in the market place but that is slowly being edged out by the government itself and these individuals who want more regulation. On the topic of you being at the whims of the corporations head, well, would you not agree that entry into the market place should be open so you can pursue the route of self-employment in which you are your own boss? Again because of government+corporate lobbying, it is getting harder and harder to do this and it is this way because of the very regulations you champion.

On the issue of the Robber Barons, this is one of the biggest myths right next to the Industrial Revolution destroyed the standard of living and the Progressive Era was a period of trust busting. Look at that list of supposed Robber Barons and see how many were actually in collusion with the government to get monopolies. They tried to get monopolies through labor and capital pools through the 1870's and 80's but it wasn't until the 1890's that they started to get government to "regulate" them so they could cartelize their markets. You seem to think that these men went unwillingly into government regulation but they WELCOMED it. J.P. Morgan actively worked with the Roosevelt administration. In fact many of the cabinet members in the Roosevelt administration were tied to the Morgan house. It isn't a coincidence that the Sherman Anti-Trust act was used against Morgan's competitor Rockafeller during the Roosevelt presidency.

You don't have to believe that the human race is a do-gooder. In fact if you don't believe it is then why do you want to invest so much power into an institution that actively hides its discrepancies in order to con the people into voting for them. You just have to believe that decentralized power, while not always perfect, is a better system then centralized power. That it minimizes the abuses and the area of effect these abuses have.