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Very Hot Topic (More than 25 Replies) Natural monopolies have existed? (Read 538 times)
DontTread44
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Natural monopolies have existed?
May 6th, 2018 at 10:22pm
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Is it true that there were monopolies on railroads and in the steel industry? I thought libertarians and ancaps ensured there was no such thing as a natural monopoly.
  
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SkyChief
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Re: Natural monopolies have existed?
Reply #1 - May 7th, 2018 at 3:36am
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Sure, there were monopolies on railroads and in the steel industry.  Oil, too.
  
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Jeff
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Re: Natural monopolies have existed?
Reply #2 - May 7th, 2018 at 9:25am
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DontTread44 wrote on May 6th, 2018 at 10:22pm:
Is it true that there were monopolies on railroads and in the steel industry? I thought libertarians and ancaps ensured there was no such thing as a natural monopoly.
Railroads were crony industries to an extent, but they always had competition, just not everywhere. People bitched that the one railroad that was built connecting their town to the rest of the country charged "too much", forgetting that the railroad was providing them with a better, faster and cheaper way to get goods to market or receive imported goods than had existed before the railroad was built.

There were arguments about the Constitutional authorization to make "internal improvements" in the heyday of canal building, and those arguments continued through the granting of valuable right's of way across government territories to railroad companies. "Progressives" won the arguments and established crony relationships with railroad companies, but there were lots of R.R. companies, most of them not gigantic crony corporations.

Libertarians have always argued from first principles that there are no "natural" monopolies, that monopolies can only be created by governments.

The steel industry received government "protection" several times, but there was always competition within the industry. Big steel companies had crony relationships with the government, that's why the government passed protectionist laws to help them out.


  
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Jeff
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Re: Natural monopolies have existed?
Reply #3 - May 7th, 2018 at 9:29am
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SkyChief wrote on May 7th, 2018 at 3:36am:
Sure, there were monopolies on railroads and in the steel industry.  Oil, too.
Ha ha.

Probably you're thinking that Standard Oil was a "monopoly" because it was selling such good products so cheaply?

What happened was that the other oil companies got together and established good crony relationships with the "progressive" government and convinced them to pass laws to stop Standard Oil from being so efficient!
  
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Snarky Sack
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Re: Natural monopolies have existed?
Reply #4 - May 7th, 2018 at 9:43am
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Jeff wrote on May 7th, 2018 at 9:29am:
Ha ha.

Probably you're thinking that Standard Oil was a "monopoly" because it was selling such good products so cheaply?




That is the modern definition of monopoly.  Might have been the definition back then also. 

Just like when Bill Gates had a monopoly because he gave his browser away for free while Netscape Navigator cost 29.99.  All Gates had to do was to set up a foundation to give to all kinds of liberal causes and concerns about his "monopoly" vanisted.  Or Mark Zuckerberg giving facebook pages for free.  Zuckerberg may take a different approach, simply writing regulations on the social media industry which will give lawmakers cover to say they did something about him while actually only ensuring that he has little or no competition in the future.

  

"Taxes are morally justified theft" - Jeff
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Jeff
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Re: Natural monopolies have existed?
Reply #5 - May 7th, 2018 at 10:15am
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Snarky Sack wrote on May 7th, 2018 at 9:43am:
That is the modern definition of monopoly. 
The modern legal "definition" of monopoly is nonsense created by "progressives" as an excuse to take control of more of the economy.
  
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ahhell
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Re: Natural monopolies have existed?
Reply #6 - May 7th, 2018 at 10:29am
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My understanding is that while natural monopolies can arise, they don't last long without government intervention.  A monopoly has no incentive to improve.  Eventually a better competitor will see the opportunity and challenge the existing monopoly. 

I'd be interested to see examples of any monopoly in the last 50 years that didn't have some sort of government support/protection.
  
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SkyChief
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Re: Natural monopolies have existed?
Reply #7 - May 7th, 2018 at 11:35am
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Jeff wrote on May 7th, 2018 at 9:29am:
Ha ha.

Probably you're thinking that Standard Oil was a "monopoly" because it was selling such good products so cheaply?

What happened was that the other oil companies got together and established good crony relationships with the "progressive" government and convinced them to pass laws to stop Standard Oil from being so efficient!

A Monopoly is where a single entity has the exclusuve control of the supply or trade in a commodity or service.

In the 1880s, Standard Oil owned or conrolled 90% of all U.S. petroleum assets (refineries and pipelines).

That is a monoploly - plain and simple.

In fact, Standard Oil became such a large monopoly, in 1911 the Supreme Court ordered the corporation to break up - ruling it was in violation of the Sherman Antitrust Act.

And let's not forget the gorvernment ordered the break-up of AT&T in 1982.  Again, the Sherman Antitrust Act was invoked.
    
AT&T certainly had a monopoly on telecommunications.
  
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Don_G
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Re: Natural monopolies have existed?
Reply #8 - May 7th, 2018 at 12:27pm
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Silly really because the oil industry isn't a monopoly but at the same time 'is' a monopoly.
  
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SkyChief
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Re: Natural monopolies have existed?
Reply #9 - May 7th, 2018 at 12:36pm
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Quote:
Silly really because the oil industry isn't a monopoly but at the same time 'is' a monopoly.


"Better to remain silent and be thought a fool than to speak and to remove all doubt." - Mark Twain
  
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