Antitrust Is Global 'Protectionism'?

[charles mueller <cmueller@metrolink.net>]

          I mentioned in an earlier post (below) that a nation's encouragement
  or acceptance of monopoly in its own industries--within its own national
  borders--on the theory that IMPORTS can supply all the competition it needs
  to assure competitive prices for its consumers, is a costly policy mistake.
  In response, I first received a communication that attributed the following
  to me:
  
                                         ...................................
  
              "Charles wrote (see below):
  
              "We should not bother about monopolies. It simply means we miss
  the real
  culprit - privilege (private law)."
  
                                        .......................................
  
          I am not the author of that sentence.  I "bother" rather
  consistently about monopolies.
  
          Next, I received a reply that suggested I was advocating "tariffs,"
  though I had of course said nothing of the sort.  (Again, see my original
  post, below.)
  
          This was followed by a communication in which the author detected a
  whiff of 'Buchanism' in what I had said there, i.e., protectionism.  Again,
  I had said nothing of the sort.
  
          All of these replies are, to say the least, inaccurate.
  Antimonopoly policy (antitrust) is the antithesis of tariffs/protectionism.
  It is no less true today than it was a hundred years ago that "the tariff is
  the mother of trusts."  Antitrust, on the other hand, is the
  opposite--"anti" trust.  One should not confuse things with their opposites.
  
          Every sovereign nation has the choice of opposing or accepting the
  monopolization of its domestic industries.  If it encourages domestic
  monopoly, then it will typically want to protect them from import (foreign)
  competition.  Japan is a notable example today.  Monopoly, collusion, and
  the corporate bloat they bring have saddled that country with inflated
  domestic prices (and costs) that are a disgrace to civilized economic
  society.  That scandalous level of corporate inefficiency and consumer abuse
  owes its existence first to the failure of the Japanese government to
  enforce a meaningful antitrust law within its borders.  
  
           Secondly, that government also shields its domestic monopolies by
  throwing up tariffs and other barriers to competition from abroad.  Imports,
  if freed from those pro-monopoly restrictions, would collapse Japanese
  prices instanter and on an unprecedented scale.  Its citizens--and its
  society--would benefit immensely.  But it won't happen because, in that
  country as in the rest of our 200 societies worldwide, there is no POLITICAL
  constituency for an effective antimonopoly policy. 
  
          Tariffs (and other forms of protectionism) are generally shields for
  domestic monopolies that oppress their peoples and enrich their
  elites--including their politicians.  A 30% tariff on a product, for
  example, is simply another way of saying that its domestic producers--if not
  blocked by the nation's own internal antitrust laws--can get away with
  OVERCHARGING its consumers by 30% without triggering a flood of competing
  imports.
  
          The ideal national policy, then, is:  A tough antimonopoly program
  backed up by a zero tariff.  (The two go together.)  The worst possible
  national policy is:  Encouragement of domestic monopoly supported by a high
  (e.g., 30%-plus) tariff on imports--and further propped up by all the other
  anti-consumer means of keeping out higher-quality, lower-price products from
  the rest of the world.
  
          Charles Mueller, Editor
          ANTITRUST LAW & ECONOMICS REVIEW
          http://webpages.metrolink.net/~cmueller
  
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  .....
  
  My earlier post:
  
          I recall a suggestion here that imports can supply the needed
  competition and nullify domestic monopoly, thus bringing competitive prices
  to consumers--and thereby obviating the need for a domestic antimonopoly policy.
  
          First, only some 15% of U.S. industry is subject to import competition.
  
          And it carries some high costs:  (1)  The JOBS are transferred to
  the exporting countries; (2) the profits go there; and (3) the
  technology--and its new developments --remains in those exporting countries.
  
          Tolerating monopoly in one's home industries via a lax or
  nonexistent antitrust policy--and then 'buying competition' from abroad--is
  one of the more costly policy mistakes for virtually any country.  There's
  still no free lunch.
  
          Charles Mueller, Editor
          ANTITRUST LAW & ECONOMICS REVIEW
          http://webpages.metrolink.net/~cmueller
  
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