American Consequences - August 2017

smartass kid from down the block (now running a hedge fund) who talked the do- gooders into letting him finance hotels on their Baltic and Mediterranean Avenues in return for giving him their Park Place to go with his Boardwalk. Never mind that in a free-market system, monopolies are only possible with the bureaucratic enforcement powers of government. And government bureaucracy is controlled by politicians, social critics, and do-gooders. And yet, the five largest U.S. corporations, measured by market capitalization, do seem somewhat monopolistic on first impression: 1. Apple 2. Alphabet (Google) 3. Microsoft 4. Amazon 5. Facebook And first impressions matter. The U.S. Department of Justice accused Microsoft of engaging in anti-competitive practices in violation of the 1890 Sherman Antitrust Act and tried to break it up in 1998. To put it in layman’s terms, Microsoft was guilty of being too good at what it did. Microsoft got there first with the best of the computer operating systems... But I doubt that, when penning his antitrust bill, Senator Sherman (1823-1900) was thinking about a funny magic-lantern-show contraption that would sit on your desk one day in the distant future.

Microsoft settled the suit in 2001 by addressing some legal complaints I don’t understand with some concessions I don’t understand either. Microsoft survived in one piece, but I bet it cost a whole bunch of 1s and 0s with a dollar sign in front. Political and socially critical do-goodery is (as most things are) worse in Europe. In 2008, the European Union (EU) fined Microsoft €899 million for its excellence and in 2013 fined it another €561 million for failing to get un-excellent enough. This year, the EU fined Facebook €110 million for monopolistic policies (not, alas, for allowing Hillary Clinton to “share” her Wellesley College commencement speech). And the EU fined Google €2.4 billion for, among other things, restricting third-party websites from posting ads from Google competitors on Google. What? Macy’s buys a billboard and Gimbels gets to advertise on it? Not that there is a Gimbels (or much of a Macy’s) left anymore, due to Amazon’s predatory monopolistic behavior. Which doesn’t exist ! Amazon’s portion of total U.S. retail sales is 5%. "

Monopolies are only possible with the bureaucratic enforcement powers of government.

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