Capitalism

Natural Monopoly

There is No Such Thing as a “Natural” Monopoly

The for many years telephone services and electricity were considered “natural monopolies” and competition was prohibited by the government or you could say the dominant player was protected by the government. But then in January of 1982, the government reversed its longstanding protection of Bell Industries and broke it up into a bunch of “Baby Bells” that could compete against each other. And along came cell phones and the rest is history.

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Why America is no Longer a Free Capitalist Country

Unfortunately, as soon as you put someone in control of the distribution of wealth… greedy, power-hungry individuals will gain control of it and take the majority share for themselves and their friends. Also as soon as you centralize the means of production it becomes inefficient and produces less… making everyone poorer.  A lesson learned from the former Soviet Union (i.e. Soviet Socialist Republic): When the government mandated that a factory produce 1 million nails a month they produced a million tiny worthless nails. So the government mandated that they produce 100,000 pounds of nails so they produced 100,000 (equally worthless) 1 pound nails. On the other hand, a truly capitalist factory must produce what the consumer wants or it will go out of business.

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Windfall Profits

Should Airlines Be Stopped From Making Windfall Profits?

There’s this crazy talk about how airlines are some kind of public utility that should only be allowed an “acceptable” profit margin so you and I can continue to fly coast-to-coast for $300 round trip… This is the sort of thinking that gets us in trouble, though. This is what gets entire industries nationalized, which is what happens when some congressman has his flight canceled and starts talking about how the airline industry is in the “national interest.”

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