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posted by janrinok on Tuesday November 12 2019, @09:03AM   Printer-friendly
from the what's-mine-is-mine-and-what's-yours-is-mine dept.

On 4 November 2019, Techcrunch published an interview with Thomas Philippon, author of the book The Great Reversal: How America Gave Up on Free Markets, where he discusses the diminution of competition in many US market sectors.

From the Techcrunch article:

Economist Thomas Philippon's new book, "The Great Reversal: How America Gave Up on Free Markets," went on sale this past week, highlighting the United States' failure to block the country's largest companies from inhibiting fair competition.

"The broad picture is that competition is good, but surprisingly fragile," he said. "In today's environment, the U.S. is moving from a place where it was at the forefront of having free markets that worked pretty well for most people to being a laggard in many industries."

Philippon's premise isn't exactly breaking news, but the interview and his book give some good background as to how we got where we are, and how other nations are addressing these issues more (in some cases, much more) effectively.

The deregulation of major U.S. industries like telecom and energy in the 1970s and 80s sparked competition that lowered consumer prices and drove product innovation between competitors. Europe, on the other hand, lagged behind with more expensive internet, phone plans, airline tickets, and more until around 2000 when a major reversal of this trend began. Strikingly, when the EU strengthened deregulation and antitrust efforts to open its markets to more competition, it was the U.S. that reversed course.

[...] Based on Organization for Economic Cooperation and Development (OECD) data, the U.S. now has more regulations for opening a new business than every EU country except Greece and Poland — a complete reversal since 1998, when only the UK had fewer rules than the U.S. Per capita GDP growth in the EU outpaced that of the U.S. over 1999-2017. On a purchasing power parity basis, Americans have experienced a 7% increase in prices (relative to EU residents) for the same goods, due specifically to increased profit margins of companies with reduced competition.

The reason for this divergence? According to Philippon, corporate incumbents in the U.S. gained outsized political influence and have used it to a) smother potential antitrust reviews and b) implement regulations that inhibit startups from competing against them. As a result, the U.S. regulatory system prioritizes the interests of incumbents at the expense of free market competition, he says.

What say you, Soylentils? Is competition truly dead in many sectors of the economy, or are there ways to bring it back and keep it?


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  • (Score: 5, Interesting) by acid andy on Tuesday November 12 2019, @12:02PM (5 children)

    by acid andy (1683) on Tuesday November 12 2019, @12:02PM (#919331) Homepage Journal

    Competition keeps prices down and drives progress. If either of those things sound like good things to you, you've got zero choice but to back honest competition above all else anywhere it's remotely possible. You can never count on either companies or the government to have your back.

    Zero? Never? That's black and white thinking. Reality is much more nuanced and variable than that, and I for one am glad of that. Societies problems are complicated and they need fairly complicated solutions.

    --
    If a cat has kittens, does a rat have rittens, a bat bittens and a mat mittens?
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  • (Score: 2, Disagree) by The Mighty Buzzard on Tuesday November 12 2019, @12:24PM (4 children)

    by The Mighty Buzzard (18) Subscriber Badge <themightybuzzard@proton.me> on Tuesday November 12 2019, @12:24PM (#919342) Homepage Journal

    Nah. When someone proposes a complicated solution, they're lying to confuse you with too much input while they snag your wallet. That or they're genuinely too dumb to simplify the solution.

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    My rights don't end where your fear begins.
    • (Score: 5, Insightful) by Immerman on Tuesday November 12 2019, @02:32PM (3 children)

      by Immerman (3985) on Tuesday November 12 2019, @02:32PM (#919387)

      The obvious counterpoint is that when someone proposes a simple solution to a complicated problem, they're lying to appeal to your naivety or stupidity while they snag your wallet. That or they're genuinely dumb enough to believe that complex problems have simple solutions.

      • (Score: 2) by The Mighty Buzzard on Wednesday November 13 2019, @01:39PM (2 children)

        by The Mighty Buzzard (18) Subscriber Badge <themightybuzzard@proton.me> on Wednesday November 13 2019, @01:39PM (#919823) Homepage Journal

        Nope, complex solutions just mean you don't understand the problem well enough to create a simple one. Rube Goldberg shit might technically work but it's always the wrong way to do something.

        --
        My rights don't end where your fear begins.
        • (Score: 2) by acid andy on Wednesday November 13 2019, @10:13PM (1 child)

          by acid andy (1683) on Wednesday November 13 2019, @10:13PM (#920026) Homepage Journal

          Lots of complex problems don't have shortcuts. It's the pigeonhole principle. A set of data can only be compressed so much. Data compression is analogous to simplifying a list of tasks to solve a problem.

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          If a cat has kittens, does a rat have rittens, a bat bittens and a mat mittens?
          • (Score: 2) by The Mighty Buzzard on Wednesday November 13 2019, @11:23PM

            by The Mighty Buzzard (18) Subscriber Badge <themightybuzzard@proton.me> on Wednesday November 13 2019, @11:23PM (#920063) Homepage Journal

            See, The Roomie and I have this argument all the time. And he's always wrong. He always feels the need to spell out every possible related detail, at least three levels out. It's absolute hell when he's trying to explain a position. By the time he's gotten around to the point, I've long since forgotten what he was even talking about and tuned him out because he's spent 75% of his breath either telling me extremely tangential, irrelevant shit or telling me things I'd taken for granted the moment he got his introductory paragraph out. That shit ain't necessary. Save the nuance for when someone actually asks about it.

            --
            My rights don't end where your fear begins.