Which side makes a better case?
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  • 2 years ago

    @ldrbyks great debate mate. I enjoyed the econ topic!

  • 2 years ago
  • 2 years ago

    PRO starts out weak. Standard Oil was 'busted' because of government idiocy and unwillingness to look at the facts.

    https://fee.org/articles/41-rockefellers-standard-oil-company-proved-that-we-needed-anti-trust-laws-to-fight-such-market-monopolies/

    We have places where capitalism actually works - so it exists. AND - we have lots of places where 'cronyism' distorts the free market and screws things up. The most recent example would be the Community Reinvestment Act (initiated under Carter, then put on steroids by Clinton) - forced banks to give sub-prime loans ....or risk severe regulatory actions (with a 'guilty unless conclusively proven innocent'...). And - the government then 'incentivized' banks to give crappy sub prime loans by buying them up and putting them in Fannie Mae or Freddie Mac....and not digging too deep to see if the loans were crappy or fraudulent. (In a free market - the bank issuing a loan was likely to keep the loan on their own books - making them more careful. In cronyism - the banks know that they can make a quick profit on a loan, and someone else 'buys it' and takes crap off their hands.)

    We DO have captalism in lots of small and mid-size businesses, which refutes the topic. AND - yes - we do have failures - but usually it is the fault of government.

    • 2 years ago

      @mvineyard On small and mid-sized businesses, they're not operating in a capitalist system b/c they're competing directly against large corporations that get subsidies from the government. For example, mom-and-pop supermarkets don't get government money like Walmart does. So the consumer's power to choose is usurped by the state. One might argue that small businesses are isolated from big business by location. (IE residential areas) But that's not true anymore. For example, a mom and pop clothing store around my block got shut down, and replaced by Banana Republic. They charge ridiculous prices that noone in my neighborhood can afford, but it doesn't matter because they are propped up by state subsidies.

      "Failures is the fault of government". If I'm reading this right, you're saying that a corporation that goes under is the fault of government? (they can fail all the time in the free market) Or that a bank fails because of government? Because if people find out that their bank is doing shady stuff, they can have a bank run and take their money out to a competitor, all within the free market.

      On Standard Oil - It wasn't a monopoly if you just accounted for market share of Oil. But Rockefeller colluded with the railroad companies (remember that rail carts was the main way to transport oil back then). Collusion (not just within but across industries) makes you eligible for antitrust action.

    • 2 years ago

      @ldrbyks Did you read the article fully and completely? Yes - there are problems - but the problems are by no means what the typical 'myth' is about.

      AND - 'collusion' is also subjective (not objective)....using promises of large volumes of oil to be shipped to lower shipping rates sounds like free market...and not something that should be illegal. Over the many decades that Standard Oil thrived - it provided higher quality products and lower and lower prices.....(MY GOD - GET THE GOVERNMENT INVOLVED...>THAT MUST BE STOPPED!!)

      Here in Kitsap County, Washington - there is an 'airport delivery service' that has fought with a EFF'D up government agency that sets rates. Now - common sense would suggest that a government agency is designed to protect consumers from opportunistic price gouging. This company has fought with the agency because the agency wants the company to charge MORE! WTF????

      You said small mom/pop stores don't get government money but Walmart does? (It doesn't....the BeeSSS trope is that many Walmart workers qualify for government benefits...as if that aids Walmart. Garbage. Fact is..Walmarts often offer competitive salaries and benefits to Mom & Pop stores.

      AND - I reexamined what I wrote and somehow I couldn't find the statement where I said that a corporation going under is the fault of the government. There are PLENTY of varying reasons why small and large businesses DO go under...SOMETIMES it is over-regulation, sometimes it is something else. (The example I did write about was why many banks and financial institutions did well while the taxpayer and home buyers got screwed over....) AND - many banks do bad and stupid stuff - but the FDIC provides 'security' ...and plenty of people put their money in banks that might do strange stuff - IF their savings are FDIC insured. Better rates of return, guaranteed by the government. The government doesn't always do a good job of regulating...and very conservative banks doing the right thing offer lower rates of return - and lose customers to banks doing risky things, if the bank is FDIC insured. That isn't good for a bank - to be incentivized to take bigger risks, and that isn't good for the taxpayer stuck with the cost of 'cleanup.' Now - if FDIC came with rules that did a 'claw back' of all bonuses and big salaries over $100K for the past 5 years if a bank failed and had to be bailed out, then maybe bank operators would act more responsibly.