In a followup to an article discussed previously here on SoylentNews:
Bloomberg has a three-part series on the use of an obscure legal document that unscrupulous lenders are using against small businesses.
After the story was released on Bloomberg, the New York State Attorney General's office opened a formal investigation last month.
(Score: 2) by dry on Wednesday December 05 2018, @04:51AM (4 children)
So the take away is that when a gallon of kerosene should have cost a few pennies, Standard Oil charged 7 cents a gallon. Or perhaps Standard Oil only charged 7 cents a gallon at a time when it cost 8 cents a gallon to produce to make sure there was no competition.
Without a lot more information, it is hard to say what the market price for a gallon of kerosene would have been with competition. All you're pointing out is that kerosene got cheaper as industry became better at extracting it and refining it, which with how common crude oil was and how fast technology advanced, is to be expected.
(Score: 2) by curunir_wolf on Wednesday December 05 2018, @11:27PM (3 children)
Well, I could have provided a LOT more information, but this didn't seem the right forum for all that. The fact of the matter is that there was NO legitimate reason for government intervention into that market at the time. It didn't help consumers, because they were getting kerosene at the best possible price, primarily due to the efficiencies introduced by Standard Oil. With those efficient processes known, it was easy for competitors to come along and charge similar prices. There was no evidence of Standard Oil (or ANY company, EVER, other than government-owned enterprises) that sold at a loss to drive out competition and later raising prices when the competition is gone.
If you're really interested in the truth, and not just spreading myths to support tyrannical and useless big government regulation, I would refer you to John McGee and his excellent articles in the Journal of Law and Economics. You can also check out the research of Ronald Koller on the history of federal predation cases. He found NO evidence of a monopoly supported by predatory pricing in 80 years of the Sherman Anti-trust Act.
And as for the government "solution," did it actually work? Well, it certainly made the Rockefellers richer than ever in the succeeding years after the breakup. And after it was broken up into 33 companies, it now exists as just three: ExxonMobile, Chevron, and BP.
I am a crackpot
(Score: 2) by dry on Thursday December 06 2018, @02:56AM (2 children)
Well, according to Eliot Jones https://archive.org/details/trustprobleminu00jonegoog/page/n6 [archive.org], we have statements such as,
As well as the problems with transport,
Now, I don't have time or inclination to spend tons of time researching your experts and other experts about Standard Oil, but the courts did decide they used their monopoly position in predatory ways.
More recently, I did experience how MS used their monopoly in predatory ways and didn't like seeing competition killed, even when they had a better product, due to unethical and illegal business moves.
Generally, since there has been successful prosecutions on anti-trust grounds, businesses have been much more careful, which has been a benefit and likely results in much less abuses.
Personally I'm pretty anti-authoritarian, whether it is government or private business. Government at least here, is limited by a Constitution and the fact that it is easy to replace through elections. When private business gets abusive, it is much harder to do much about it, with government seeming about the only solution. You can look at actions of the Pinkertons as an example of how private police can function, and a long history of private businesses being very abusive, to the point of cutting off workers arms when they weren't productive enough and the business can get away with it, such as Columbus on his 3rd trip desperately trying to raise the funds to pay of his investors.
Best is if the different forces largely cancel each other out.
(Score: 2) by curunir_wolf on Thursday December 06 2018, @10:45PM (1 child)
Elliot Jones and Ida Tarbell wrote extensively about Standard Oil. They had an axe to grind, both of them, against Standard Oil, and their writings have been discredited in the years since. The assertions by both of them have been proven false. Even the quotes you provided are conflicting - was Standard charging too much or too little? He seems to argue both. But Standard was successful ONLY because of efficiency and the purchase of verticals. Even with a large market share, competitors were many and nimble, and they HAD to keep prices low to remain competitive.
It's not that I think there is no role for government in regulating large businesses, only that most of those efforts, in retrospect, cause more harm than good. How did Netscape fare with the government going after Microsoft? Does Microsoft behave better now? Consider what the real change was. Microsoft went from pretty much ignoring Washington, to devoting a huge budget to lobbying and campaign contributions. In fact they became the largest corporate investor in lobbying. So it was nothing but a bureaucratic shake-down that helped no one.
When people wake up to this myth that government protects people from corporations, and realize that the big government / corporation bureaucracy is actually a partnership designed to screw everyone else, then at least we can start to do something productive about it.
I am a crackpot
(Score: 2) by dry on Sunday December 09 2018, @03:57AM
Hmm, looking, I can't find any evidence of either being discredited. Elliot Jones seems to have mostly disappeared from history and all I can find is praise for Ida Tarbell along with "The History of Standard Oil".
As for the quotes, it's pretty simple, low prices when there is competition and high prices when there is no competition. Whether that was abusing their monopoly, I don't know, but could well be. Even today, these problems continue. My ISP charges all different rates depending on Province and how much competition there is. I pay a $100 for 250 GBs, in some Provinces, it would be $40 for unlimited from the same company, due to competition.
As for the MS anti-trust case, Netscape was really the wrong underdog in the fight. DrDOS, Lotus, even OS/2 would have been better cases to show the anti-competitive behaviour. And then when the government changed and let them off, it showed them the power of having the right type of corruption. IBM is a better example as they tried like hell to honour their agreements from their anti-trust case.
You're mostly right about the government/business synergy, especially bad in places like the US where people are really tribal and vote for their people no matter what and the best that can be hoped for is that one parties people stay home.
Here the parties have usually worried more about the voters. The party that orchestrated the free trade bullshit that saw all our good jobs head south got annihilated in the next election, reduced to 2 seats and the party no longer exists at the Federal level. Imagine if America had reacted to NAFTA like that, your politicians might pay more attention to the voters instead of the lobbyists.
Unluckily, that's changing in this age of popular-ism, instead of politicians running on promises to do good government, it is divide and conquer, vote for my team no matter what, and that does not lead to good government, rather bullies getting power and being more interested in bullying then doing what is the best for the people.