Topic: Need some opinions on unregulated business (Read 2807 times)

Of course not. I meant that Wallmart has a large share of market because they deserve it. They have greatly contributed to society.
Wallmart is not "abusing" of his big market share to practice high prices, quite on the contrary, it earned his market share for practicing low prices! The day their price/quality ratio is not competitive any more, they will lose market share. Or if someone one day manages to be even better than them.

You should watch that whole Penn & Teller episode (my link above is to its first part) if you are among those who hate Wallmart.

In practice, these are exactly the same thing.

I think libertarians need a strong central government, because without them, they'd have nobody to blame all of capitalism's problems on.

Like how fucked does your brain have to be to see a company that exists solely to make a profit doing something evil for entirely profit-based motives, then determine the problem was somehow the government's fault?  I've seen more hardcore Christians find fault with their own bibles than I've seen libertarians find fault with any business anywhere for any reason.  You guys should probably quit pretending this ridiculous shit has some basis in logic, and just admit that it's your religion. At least that'd be somewhat honest.

That's not really the artificial government barrier that everyone constantly keeps referring to. The one that is "very high". High enough to prevent people from competing.

You mean that highly efficient retail store that has succeeded in lowering prices considerably, making the lives of the poorest more affordable?
The main barrier there is being better than them. They are doing a great service to their clients.

https://www.youtube.com/watch?v=Y-o1fj1rX7A

Fine. What's the barriers of entry that prevents you from competing with Walmart? I keep hearing this argument that the government prevents you. Let's see some real world examples of that.

We don't really want no regulation, we want self-regulation.


That is because the state has destroyed the concept of private property and punishes anyone that try to enforce property rights there.


There will always be a group of relatively poor in society. In a government regulated labour market it will be unemployed and they have no hope. In a free-market it will be people who have just entered the workforce with very poor skills, and they generally advance to better positions eventually. Among the employed it is not the same people that are poor year from year even if the poverty rate should remain unchanged.

Cartels don't hold not on the sale or employer side. If they are trying to fix the wages below market equilibrium the first one breaking the cartel and paying equilibrium wages will soak up all the non-stealing and smiling people willing to do a Wallmart job and it will make there service better and reduce cost from employees being lazy or stealing and breaking stuff without reporting it. So they will become more effective then all the other firms and take much of the market from them.

Cartels only work when government makes the barriers of entry very high so you have the same few huge business in a market for a very long time that can develop the connections and trust to each other necessary for it to hold.
 
It is even more unlikely a wage cartel would work then a sale price cartel. Because they aren't just competing against other companies selling the same product or service. They are competing against all low-skilled labour employers, which can be in completely different industries.

I thought you said that the risk of death was the preventing factor? AFAIK there are more more murders in the US that have that risk than in Canada where murderers don't face that risk?
I don't want to get into a debate regarding guns as it is as futile as it is tiresome.

Yes, I'm sure it would play out more like two old coots sitting on their front porches with their rifles threatening the other not to dump waste on their land and not a company with their own PMC, planes, and bombs threatening poor villagers who have 4 handguns and a possibly functional WWII era grenade.

Russia wasn't defeated by Afghans alone you know.  There was this place called America supplying Stinger missiles, landmines and a whole load of other ordinance.  It was a distinctly American victory.

That logic fails if the people who suffer from pollution are not the same ones as those doing the buying. 

The need is that people don't want to live in a society where they will tolerate your pollution one minute, and kill you the next. The marginal cost of generating externalities would be either 0 or your life! That's extremely unstable. You say "resort" to middlemen as if violence shouldn't be our last resort.


The market for insurance decides, not me, and not some nut with a gun. An insurance market gradually increases the pressure - starting with peaceful means - to reduce your externality as the interference worsens. At least destroy the power lines to a polluting factory before killing its owner! Your proposal is even worse than pollution taxes, since those DO address minor pollution.


So when does it start to work? Without a plan for a gradual transition, a proposed system is impractical. Shall we wait until everyone is an educated nerd like us?

If it's free then people will buy from wherever they want. If they want to protect the environment they buy from eco friendly companies . IF they don't want they buy from non eco . And you do as you please , you want to protect the trees , preach about it. It doesn't work the environment is screwed . The environment is screwed we adapt like we did before.

Yes.  An American Army hog tied by the delusion you can win the hearts and minds of people who's country you are occupying gives up in disgust when people don't show them some love.

Contrast the Russians in Chechnya or Israelis in Palestine.  Bombs and missiles by the ton - and they both won.

As I said, people with guns are essentially helpless against modern armies.  For a short while they can make nuisance of themselves with shoot and skoot tactics but unless they are backed by a state providing modern ordinance, they will be eliminated.

That's why I don't understand people saying they want to dissolve the state in their own country.  It just means that a foreign country gets your land and its resources while you get to choose between the graveyard and subservience.

Just like the threat of death has completely eliminated murders in the US? Nobody murders there, right, knowing that they will pay for it with their lives?

This happens on typical Tragedy of the Commons scenarios, where an agent can externalize part of his costs. If property rights are respected, the owners of those properties being damaged by such companies could stop them or demand something in exchange.
The important thing is that every agent internalize all its costs.


"Getting together" to "fix prices" doesn't work if there is freedom of entry. Doesn't matter who's getting together or what prices we're talking about, if a competitor can always enter the market proposing better prices, such cartel cannot stand for long. The wider the gap this cartel tries to create, the stronger the incentive for someone to enter the market or even some participant of the cartel to leave it. Cartels like this need the use of force (normally masked as "regulation") to stand for long*.

This is particularly strong on the labor market, since competition among employers is wide. Wallmart doesn't compete only with other retailers, but with everybody that's looking for non-skilled labor. Labor is finite, but the demand for it is virtually infinite due to the constant state of unsatisfaction of the human being (there's always something that can be done to better satisfy us).


*And even in some coercion scenarios, some interesting examples of "market solutions" may arise. I've known places where it was forbidden for some business to propose prices lower than a certain floor. Two things used to happen: some participants would propose better prices "under the table", and some would add "extras" to their services, for example a gas station that also washes your car for free if you fill your tank there.
IMO, trying to coercively set prices like that is much less effective than regulations that prevent or completely forbid the entry of new participants in a market, like the regulation that simply stopped MtGox from operating in France. These regulations are stronger "cartel keepers". The alternative to them are black markets, but for some sectors they are not really an option, particularly those sectors which strongly depend on contract enforcement, like banking. Most people are not willing to ask "the Mafia guy" to mediate their contracts...

An assassination market is just an extreme and barbaric form of insurance as I described above. There is no need to instantly escalate to killing people when the EXACT same mechanic can be used to finance private security.


You will never have 100% support for anything ever. Even if everyone agrees that I should stop polluting, I could have my own hired guns.

And that's completely ignoring the fact that minor and ambiguous aggression still does need to be prevented anyways, even without consensus. We should not underestimate the number of people who don't understand the science and economics of pollution.

Not to mention collateral damage.

Its one thing to have a silly fantasy that lots of nutters with guns will make the world a better place but why not take a look at reality.  Guns are slightly better than bows, arrows and lances in modern warfare.  Its been all about air power and ballistic missiles since World War I and even if you have everyone trained to use guns, you are essentially helpless against modern armies.

I'm concerned that the game might not play out like that. Pulling a gun on someone for whatever reason is a huge risk, and without an incentive most people would rather let "someone else" do it. Unless someone pays the guys with guns, they would rather free ride.

There's also the issue of minor or ambiguous aggression. We all pollute to some extent, at what point will you pull a gun on me for it? Will the other people with guns agree with you? There are very large gray areas.

Wait till you see this: http://www.youtube.com/watch?v=4EUAMe2ixCI

I watched it the other day, and thought it was awesome.

Government is bad because it's a monopoly more than for any other reason. You can think of the world as a free market anarchy where all the land is legitimately owned by 193 landowners that allow you to live on the land under certain conditions. A few are genuinely criminal, but with most once you hit the age of majority if you don't like it you can leave, and if you don't like all of them you can go live on a raft in international waters where no law affects you at all (well, if you start attacking cruise ships, you'll get arrested quickly, but that's legitimate self-defense not any kind of coercion). So why do we see all these harmful effects from oversized government? Because government is non-competitive, and in practice most of us don't have the choice of going to another country over disagreements about the level of taxes, public services, personal freedom, etc. A corporation or cartel that has a monopoly on food and shelter will have the exact same negative consequences as a government monopoly on land. Secondly, both megacorps and governments suffer from the same economic calculation problem with regard to internal affairs, which makes both inefficient once they cross a certain size threshold.

All this brings me to my second point - why we are here (the Bitcoin forums). For most of us, it's not just getting fedgov out of our money, or creating a new, better gold standard, it's also about getting rid of the need for banks, credit cards and Paypal - it's about getting big business as well as big government out of where it doesn't belong. With the internet, there is an unprecedented opportunity to decentralize the economy and massively reduce worldwide power and wealth inequality. Self-employment will go up, and small businesses will become more and more powerful. The world will become less hierarchical and based more on peer-to-peer mechanisms: the free market, crowdsourcing, democracy, etc, and we will all benefit.

"Long-term" lol


For most businesses, long-term considerations include anything not on this quarter's report.

Environmental exploitation and other externalities: insurance.
You buy insurance against bad things like someone poisoning the water supply. These insurance companies then offer to buy their own insurance for this event on the open market, but below your price so they will make a profit at very low risk. Someone takes them up on their offer and stands guard at the water supply to tilt the scales in his favor. The more insurance companies and more guards competing, the more cost-effective your purchase. If for some reason I benefit by poisoning the water supply (say I own a polluting factory), I can sell insurance to the middlemen at a loss to control the price and thus ward off vigilantes. If my loss on insurance is less than my benefit from polluting, I am basically paying off everyone who buys insurance.

This works a LOT better in theory because of real-life transaction costs and a limited number of participating firms. I'm currently exploring ways to use Bitcoin to reduce this problem.
http://en.wikipedia.org/wiki/Coase_theorem
https://bitcointalksearch.org/topic/decentralizing-prediction-markets-47122

For labor, it's a prisoner's dilemma for the Walmarts of the world to all collaborate. I suspect this collaboration happens in practice partly because those companies have a lot of influence in government. But that's kinda the standard libertarian excuse for everything.

Prohibit is perhaps a strong word. Can I just ignore your "monopoly" and just do what I want with my stuff? If so, you don't have monopoly privilege. If however, you can constrain me thru government licensing, regulation and other agencies that can manipulate what I can do with my things on my property, then monopoly exists. So no monopoly on force either.

Prohibit monopolies through a monopoly on force?

Just prohibit monopoly privilege. By evening the playing field, it's probable that the likes of Walmart couldn't manipulate pricing for long. Of course, if everybody conspired to financially hamstring their neighbor, not even the best of governments could stop it. A society is only as good as as the individuals it comprises.

Laws make for good suggestions, they don't stop crime, they don't make people more charitable, more meek, benevolent, friendly, caring or otherwise. However, making laws that give special privileges or authority to one class of individuals over another only exacerbates the problem.

Sure it can.  And as you sip a pina colada in your Caribbean yacht, you will no doubt find ways to ignore those long term impacts.

Of course it does. A damaged environment can have a long-term impact on expenses and profit.

I think you misunderstand the purpose of a free market.  Its to get the best return on capital.  The environment doesn't appear on a balance sheet.

I've been a libertarian for a number of years and I consider myself a staunch anarcho-capitialist. But one thing that I've never been able to resolve is how to stop exploitation (environment, people, etc) in a true free market. I'd like some of your opinions on how this might be addressed. Let me give you some examples:

Currently, we have several companies that are basically destroying the environment in several African countries and decimating the regional or local economies. If they were unregulated, would this behavior not increase?

What about labor exploitation? While I don't agree with the assessment most people have about Walmart being a slave labor company, let's use it for our example. So Walmart pays its workers slave wages and they toil away long hours working for little money. Right now, we can say that they choose to do so because, if they didn't like it, they could go elsewhere and earn a higher wage or upgrade their skills to get a better job. But what happens in an unregulated market where Walmart gets together with every other retail giant and price fixes labor costs? At that point, the laborers only option is to upgrade their skill but then they aren't making enough to pay for the education required to do that.

I truly believe a free market capitalist society is the only way we'll ever be profitable. But issues like this are ones that have kept me puzzled for a while. Can anyone offer some insight?

Thanks!
TMA