Re: Antimonopoly is Anti-Capitalist?

[John Robert BEHRMAN <jbehrman@netropolis.net>]

  Huh?
  
  The last great anti-trust legislation was co-sponsored by Will Clayton,
  co-founder of the Anderson-Clayton cotton brokerage. This was one of the first
  American corporations to become international in the scale of its operations.
  The company was rooted in cotton exchanges, commodity trading operations
  commonly found in major Southern cities. It was able to go overseas when common
  carriage laws in Texas made cotton farmers and merchants something other than
  sharecroppers for railroad monopolies and stevedoring or riverboat
  concession-holders. Also, there were overseas cables and telex machines.
  Electronic commerce is about a century old.
  
  Will Clayton was not well schooled, having moved from some sort of public high
  school directly to the docks in Galveston. Nonetheless, he rose progressively
  through business and political circles to become a respected statesman,
  Undersecretary of State for Economic Affairs under Roosevelt and Truman. He
  negotiated the Lend-Lease deal with Britain and France in 1940, the Bretton
  Woods monetary regime, and the Marshall Plan.
  
  Was Clayton a Capitalist? Probably not insofar as that was a euphemism in his
  day for damnyankee, Republican railroad tycoons. Clayton was a populist
  Democrat. On the other hand, he was a friend and colleague of W. Averill
  Harriman, the well-born son of one of the aforementioned tycoons. The simple
  fact is that there is very widespread agreement across the political spectrum on
  what constitutes efficient pricing under market competition. Apart from military
  regulation and certain economies of scope, scale, and cycle, usually temporary,
  there is no economic justification for monopoly under capitalism or market
  socialism.
  
  What we are dealing with in the US today is a very peculiar sort of
  Anglo-Austrian Libertarianism, which hardly existed anywhere before 1939.
  Originally, it came from the ex-Hapsburg Jewish nobility and Russian refugees
  like Ayn Rand. They were virulently anti-Bolshevik but hardly welcome on the
  right anywhere in Europe. They found patrons among such of the anti-New Deal
  right in America as were not hopelessly anti-semitic though. Then came the
  bourgeois Irish Catholic Wm. F. Buckley, embittered at Mexican nationalization
  of his daddy's oil fields.
  
  These folks have revived a sort of religio-capitalism, the notion that any rich
  entrepeneur is the Elect or Chosen of God, a Darwinian Survivor, or some such
  without distinction as between earned and inherited wealth, or profit and rent,
  or technical and marketing innovation. This is music to the ears of old railroad
  and new software tycoons.
  
  The Capitalist of Adam Smith or David Ricardo, however, was the hands-on manager
  of capital in the form of real property applied to productive farming, industry,
  or trade, not a banker and certainly not the merely rich beneficiary of
  inheritances or government concessions and favors.
  
  That is the sort of capitalist Friedrich Engels actually was and Marx praised
  relative to feudalism but criticised relative to whatever sort of socialism
  communism would lead to.
  
  Will Clayton was no great student of books as long and unreadable as Das
  Kapital. He, however, realized that the Communist regimes of his day lived off
  of shared monopoly rents and indirect taxation. The relationship of the Soviet
  State, Communist Party, and Cheka was obviously based on Marx's and Engles'
  admiration of the US Government after the US Civil War when the Republican Party
  and FBI lived well off of rent from the railroads' monopoly concessions.
  
  My guess is that Will Clayton would be moving to end local telephone monopolies'
  exclusive concessions and would certainly not tolerate Microsoft extracting
  monopoly rent from chip merchants and computer fabricators much as cotton
  merchants, farmers and mills once had to pay whatever the traffic will bear to
  railroads. The amazing thing to me is how many people in the digital trades
  support Microsoft as if that would magically enrich them. That cultic naivete
  was not characteristic of Southerners in Clayton's day, their dead fathers and
  uncles maybe, but not them. They read Mark Twain, not Sir Walter Scott. They
  preferred capitalism to Soviet Communism but were aware of what it took to make
  capitalism work, to some extent, despite itself and, in any event, in harmony
  with, not it opposition to republican democracy.
  
  It is republican democracy that the Libertarians object to. It accords political
  equality to all regardless of wealth or schooling, not to mention worthless
  titles brought over form Europe by formerly rich or pseudo-noble Russian and
  Hapsburg burgers. Probably the most insufferable nobility are the one-generation
  variety.
  
  charles mueller wrote:
  
  >         I was struck by the characterization below of antitrust as
  > "anti-capitalist"--but was confident that numerous members would promptly
  > correct that inaccuracy.  A poster refers to antitrust as "draconian govt.
  > enforced anti-capitalist measures, like the socialist 'anti dog-eat-dog'
  > bill supported by competitors to a trans-continental railroad in Ayn Rand's
  > 'Atlas Shrugged.'"
  >
  >         Antimonopoly policy is "anti-capitalist?"  For that to be true, such
  > a national policy would have to be hostile to capitalism in its motivation,
  > effects, or both.  Precisely the opposite is the case.  The original U.S.
  > antitrust law, for example--the Sherman Act of 1890--was passed by a
  > Republican Congress at the urging of a Republican senator.  "Sir, now the
  > people of the United States, as well as of other countries," Senator Sherman
  > told his fellow conservatives, "are feeling the power and grasp of these
  > combinations, and are demanding of every legislature and of Congress a
  > remedy of this evil.... You must heed their appeal or be ready for the
  > SOCIALIST, the communist, and the nihilist.  Society is now disturbed by
  > forces never felt before."  The intent of the lawmakers, in other words, was
  > plainly not to harm capitalism but to preserve it; the enemy of antitrust
  > was collectivism in its various forms.
  >
  >         And that has just as clearly been its effect:  Among the world's 200
  > countries-- as I've emphasized before--those with high per-capita incomes
  > have the most robust competition, the poorest the most monopoly.  Adam
  > Smith, the first modern economist, spoke often of the "wretched spirit of
  > monopoly"--its "mean rapacity, [its] monopolizing spirit"--as an enemy of
  > healthy capitalism rather than a necessary part of it.  Smith, capitalism's
  > original icon, an "anti-capitalist?"  Capitalism has no greater friend than
  > antitrust.  Kill the latter and, in a democratic society, you've killed the
  > former.  Collectivists everywhere are quite clear about this.
  >
  >         In political terms, monopoly is routinely applauded by both the
  > left- and right- wings of the spectrum.  When the U.S. Congress holds
  > hearings on antitrust, those who oppose it are routinely led by, e.g., John
  > Kenneth Galbraith on the left, who argues that all significant U.S.
  > industries should be monopolized--and PUBLICLY owned.  (See his 'Economics
  > and the Public Purpose.')   On the right, Milton Friedman and his followers
  > affirm that, yes, all important American industries should be under the
  > thumb of a single monopolist--a very PRIVATE capitalist, subject to no
  > public regulation or other government meddling in its affairs.
  >
  >         Antimonopoly policy?  No political or intellectual constituency.
  > Advocates of the left think monopoly is great because it supports their case
  > for public ownership (a la Galbraith) by portraying capitalism and
  > monopoly--systematic larceny--as synonymous.  If a country must accept
  > nationwide monopoly as the inevitatable price of a free-market economy, then
  > socialism has a chance to win popular support. Antitrust is (correctly) seen
  > by Galbraith et al, then, as an enemy precisely because it's the ingredient
  > that makes capitalism socially attractive, which is to say, makes it
  > competitive--and thus FAIR, efficient, and innovative.
  >
  >         Socialist (collectivist) opposition to antimonopoly policy rests, in
  > other words, on the realpolitik notion of embourgeoisment--the idea that, if
  > the peasants and proletariat are allowed to actually EXPERIENCE first-hand
  > the real-world benefits of free markets, they'll love owning their own land
  > and shops and will thus lose interest in the idea of being herded together
  > on collectives of various sorts, whether in the fields or the factories.
  > Intellectuals of the right, on the other hand, believe that monopoly is both
  > wonderful and the natural order of things--a splendid tool for continuously
  > concentrating income/wealth into the hands of the deserving few.
  >
  >         No nation, to my knowledge, has and implements an effective
  > antimonopoly policy.  Capitalism won the war against socialism--a sure-fire
  > prescription for poverty in every country that has been beguiled into trying
  > it--but has yet to learn how to deal with (as I've said before) nerdy twits
  > like Bill Gates and their platoons of over-paid monopoly lawyers.  Monopoly
  > on the left, monopoly on the right.  Real prosperity is capitalism without
  > monopoly--the latter born of, as Adam Smith reminded us,  a "mean rapacity"
  > and a "wretched spirit."  Any honest government could purge that
  > institutionalized, organized theft from its borders in a trice.
  >
  >         Charles Mueller, Editor
  >         ANTITRUST LAW & ECONOMICS REVIEW
  >         http://webpages.metrolink.net/~cmueller
  >
  >
  >                                                  ***************
  >
  > At 09:16 PM 11/18/97 -0500, you wrote:
  > >>Paul Ferzoco (by way of John N Bryan) wrote:
  > >>> It's their overwhelming plan to FORCE us to use their products that
  > >>> piss's me off. Those of us who've been in the industry for 30+ years are
  > >>
  > >>Hmmm, could someone elaborate on the use of 'force' by MS to use their
  > >>products?
  > >
  > >"FORCE" may have been too strong, too broad a word.  However, if the
  > >only choice available is the same company that caused there to be only
  > >one choice, then perhaps there is an indirect forcing.
  > >
  > >
  > >>
  > >>I still think there is time for public market forces to foster a
  > >>groundswell of support for
  > >>a competitive product without having to resort to draconian govt. enforced
  > >>anti-capitalist
  > >>measures, like the socialist 'anti dog-eat-dog' bill supported by
  > >>competitors to a trans-
  > >>continental railroad in Ayn Rand's "Atlas Shrugged".
  > >
  > >If there are allowed to be competitive products.  If the environment
  > >is such that competitive companies and products are, through no fault
  > >of their own, prevented from being made available to the consumer to
  > >choose, then essentially there are no competitive products. It does
  > >me no good for there to be a competitive product if I never have
  > >the opportunity to choose it. Generally speaking.
  > >
  > >I trust you are not implying that the DOJ, by their recent actions
  > >with respect to Microsoft's licensing practices as they relate to
  > >the 1994/5 consent decree, are taking draconian measures. To examine
  > >things of this nature is hardly unreasonably harsh, and would seem
  > >to be part of the normal part of their role. In as much as their
  > >actions are defined by law, etc., I don't think they are draconian.
  > >
  > >So far as "enforced anti-capitalist measures" are concerned, yes,
  > >they are in effect anti-capitalist.  Like other dynamic forces,
  > >capitalism can be directed and at times curbed to prevent it
  > >going out of control.  I don't think the DOJ has reacted none too
  > >capriciously in this case.  Quite the contrary, I think they have
  > >by in large been too conservative where Microsoft's business
  > >practices are concerned.  I am reminded of a nuclear power plant.
  > >You have a sustained nuclear fission reaction going, a very poerful
  > >force, and it is kept from going out of control by certain systems,
  > >(coolant, control rods, etc.).  Without the existence of some
  > >admittedly anti-capitalist bounds, it might be possible to have
  > >a capitalistic Chernobyl on our hands.  The damage from such
  > >an end is far worse than the "damage" to business, the economy,
  > >and Capitalism caused by the the anti-capitalist measures.
  > >
  > >John B
  > >
  > >
  > >--
  > >"You are not free because you CAN choose, only if you DO choose."
  > >"Everything you are is the decisions you make. If you allow circumstances
  > >to make them for you, then what you are becomes very easy to estimate."
  > >--
  > >
  > >
  > >
  
  
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