Monopoly tax might give Microsoft and SBC reason to preserve competition infoworld.com
Old timer net guy Bob Metcalfe doesn't much hold with monopolies either. He goes after all of 'em, Telco's, Cable guys, Microsoft, whoever. Good for him, I say. Here, he sort of turns the old "anybody against Bill is a commie" argument on its head. It must be at least 12 hours since we last heard that one here. He also takes a few shots at the much loved fellow traveler of Microphiles everywhere, Ayn Rand. He sorta tees off on that pesky coercion thing. Of course, "standard Microsoft business practices" couldn't possibly be coercive- that little sacred icon defense thing with Compaq, Microsoft really and truly only wanted to preserve the integrity and uniformity of the Windows experience. Really.
Yes. It's FOCACA [freedom of choice among competing alternatives] that works, not monopolized markets, which really aren't markets at all, and don't work -- see Marx and his deadly failures.
One bug in our market systems is that companies accumulate monopoly powers with their size more rapidly than they suffer "diseconomies" of scale. They, in fact, overcome their diseconomies by gathering the tools of market coercion.
Colleagues just to my economic right, who sometimes forget that Atlas Shrugged is actually fiction, deny the powerful tools of monopoly coercion -- this despite there being so many: economies of scale, cross-subsidization, dumping, proprietary interfaces, tying, exclusive distribution, preemptive product announcements, discriminatory pricing, agreements by geography not to compete, lobbying, litigation, and campaign contributions.
And there are so very many practical precedents for mechanisms to mitigate monopolization. In boxing, the rules try to keep the winner from killing the loser so he can fight another day. In football, there's the draft, which tries to keep dominant teams from making games boring. In politics, there are term limits. And, of course, need I mention so-called progressive income taxes?
These got me thinking about how to debug our market systems so monopolies are not so much the tendency. OK, why not progressively tax business profits?
Well, business income taxes are already counterproductive. OK, so, instead of increasing them, how about cutting them, progressively, say by exempting the first $1 billion of profits?
To avoid "monopoly taxes," Microsoft, SBC, and others would spin off profitable businesses instead of acquiring new ones. This would not be confiscation; shareholders would get stock in the spin-offs.
Spinning off successful businesses to minimize progressive income taxes is one way Microsoft and SBC could avoid stepping in FOCACA. Marx is dead, hopefully, so do you have any "monopoly tax" refinements to suggest?
Cheers, Dan. |
