35 Comments
Nov 14, 2021Liked by Matt Stoller

Matt, are you the only one with the monopoly on the knowledge of monopolies? It's such critical insight to the levers of power.

Please list others to read.

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the facts sheets, primers, explainers, reports, testimony, and references at Open Markets, the forebear group of Econ Liberties, are good places to start. OM is the same kind of group as EL, but without the (c)(4) arm so no direct political activities and they've been around a very long time so they have a lot of material.

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Nov 13, 2021Liked by Matt Stoller

Great Piece Matt, in short, all the big liners who control 80% have no incentive to solve the current issue, actually, they have the opposite as incentive so that they can make 10 times of their previous best year result...hopefully the US administration will start looking into this....

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Shucks, been "hopefulling" that for decades ....

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I would point out that it wasn’t the railroads where this process first played out but rather the canals.

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Somebody REALLY knows their history.

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Would it be correct to say that our health care system is at the point of “ruinous competition?” As a physician in Pennsylvania I can certainly see parallels.

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Interesting article. Much snarling in the first part but it got less snarly later on.

The deregulation of the 1990s has been creeping poison to the US economy. America revs high as a nation at the best of times so economic pain gets real fast. Pressure on society becomes ubiquitous (and iniquitous). Worker exploitation is pushed to extremes, metastasizing into an existential threat of precarity. Culture war SNARLING gets violent as government capture is weaponized to change laws that enable (and enforce) oligopoly lockdown. Profit and self-interest, the engines of American prosperity, shift from dynamic growth to zero sum toxic.

What's going to fix this? It'll take a powerful and independent government to turn back the tide on decades of inertia; but if anything today's corporate Democratic Party is part of the problem, the GOP too lost in grift and bullshit to be an alternative. How does the insane oligopoly cartel get stopped? It's hard to see anything but Brazil-style disintegration or China-style technofeudalism coming next.

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the poison's been creeping so long, I feel like the patient's gonna die or at best continue as this unrecognizable zombie, and did you ever hear of a zombie coming to life again?

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3rd party - ind of corp $

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Did you mean DANISH shipping giant, Maersk?

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author

Yes. Thanks. Fixed.

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founding

Root causes:

1.) practically unlimited corporate money in U.S. politics at all levels — one dollar = one vote vs. one person = one vote;

2.) FOE — the financialization of everything; and

3.) markets, markets, markets — “free” & unregulated = criminality automatically becomes the norm.

We have to take care of #1 before we’ll be able to make real progress on anything else, methinks.

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Hmmm, it's been over 10 years since CU was decided, but for some strange reason I see no move by either "major party", to overturn it ....

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We also can thank Milton Friedman, the economist, for his anti-regulatory work. When I was in college, which was about the same time as Bill Clinton, MF was becoming an economics celebrity.

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Shucks, it wasn't Friedman who passed all those de-reg bills ....

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Friedman wasn’t congress, but he inspired a lot of deregulation. Read The Shock Doctrine, by Naomi Klein. The Chicago School was influential, and Friedman was hired to create govt policy. Another way to look at it: he was hired to give scientific approval for some officials to do what they wanted, despite its immorality.

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Milton Friedman had no problem with "intellectual property" law, which is probably the largest government interference into natural markets around, and has created whole new markets that would not exist otherwise. His "don't regulate" and "avoid government interference" approaches are extremely situational.

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Yes, absolutely. The extreme version of a market free of regulation is one where we can murder our competitors. I’d be a little less respectful of Friedman, given his efforts in Chile and elsewhere.

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Yes. We seem to agree, and a free market (or a perfect market is unlikely to exist in an unregulated global market. I was being sarcastic in my first comment. IMO, Friedman was a cult leader, not a serious economist.

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There is no one "free" market and no such thing as a perfect market. A market is a social construct (i.e., something people get together and create as a group) that embeds in it particular values and aims, whether overt or not. Is it bad if workers starve to death? Well, that depends on your values, and whether your labour market encourages or discourages that expresses those values.

A classic example is the 2021 Texas power crisis. It's true that regulation might have mitigated this, but it could probably equally well have been mitigated by ERCOT entering contracts that required sellers of power to commit to continuing to deliver power throughout the winter or pay large penalties, which would have made it worthwhile for them to winterise their systems. Instead, ERCOT chose to enter contracts that basically said, "sellers can walk away any time they like." That made the sensible choice for sellers not to spend money on winterisation and instead just sit out any problems like this. Both markets would have been been equally "free" (sellers have no choice but to sell to ERCOT on ERCOT 's terms either way), but one would have mitigated the problem, the other put massive profits into sellers' pockets as ERCOT started paying the maximum possible rate they could put in their system in order to encourage sellers to stay in the short-term market.

That market was designed around the value, "Profits and convenience for sellers is more important than reliable power."

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In summary -- monopolies just about everywhere including the US voting system... ;-))

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Curt, I no longer see the original post or the comment to which you replied. Your example works, but describes a wholesale market where consumers are the tail of the dog, i.e., they have little influence on the market’s movement or function. Consumers are victims of the values decisions ERCOT and suppliers make. Utilities markets usually are not free or competitive.

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Since we have no ocean lines to speak of (other than the domestic Jones Act trade), how will the USA really effect these global industries? We are the largest market, but we are still only 15% of the global economy. To what degree can we dictate terms to foreign ocean carriers that have the backings of their respective governments? And I love this: "Public investment in new shipping firms would be useful here." Can't wait to see the opportunities for graft and mismanagement at Uncle Sam Lines. It will have the service of the post office and the technology Amtrak.

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author

"To what degree can we dictate terms to foreign ocean carriers that have the backings of their respective governments?" Substantially.

"It will have the service of the post office and the technology Amtrak." Both work quite well.

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great, professional thoughtful article and research !

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Hey, Love your work. I am curious if you have or know of a great resource for the history and practices of corporations/incorporations from the early US 1790 and before

Until the 1950s I guess (or whenever) when corporations were formed by state charter and (GSEs) compared to other non incorporates ones?

I am seeking a mark to market/ apples to apples comparison and prism to view the economy of then vs now. Any resources and/or post you can refer to would be helpful. I know the first public accommodation of the flour grinder was an example.

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author

I don't have a good suggestion for you, sorry. This book kind of gets at it. https://lsupress.org/books/detail/securing-the-fruits-of-labor/

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Thank you for this detailed write up!

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Let's go kick old man Potter's ass! Keep it up Matt

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> The Ever Given is the height of the Empire State Building

Guessing that this should read as

"the length of the Ever Given is more than the height of the Empire State Building"

Best I could get on the height of the Ever Given was 32.9 metres from keel to deck (so then a bit taller after that).

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Another great post! An example of both horizontal and vertical integration - as in the turn of the last century - you seem to be one of the few who extends the critique beyond the usual rather narrow, I would argue, focus on the "horizontal" kind ....

Thanx! Looking forward to more :)

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