>>>Meanwhile, the bus service got so bad for the hundreds of thousands of poor hispanics and blacks who have to rely on it for daily transportation that they filed a civil rights action to try to remedy the inequities. They won, but now the MTA won't be able to comply with
the judgment because of the billions in debt incurred to pay for the perks and the pork.<<<
Well, here's an example of a bad government department, a bus company. Therefor, are all government run bus companies bad? Because I have met one drunken, crooked lawyer, are all lawyers drunken and crooked?
You know this as a classic logic mistake, taught as such to grade school kids, right?
BTW, the second and third best mass transit operations I know of are the government run outfits in Seattle and Portland.
The first best is the system in Hong Kong, where this is a mixture of public and private methods, with the extremely cheap and punctual but crowded public service holding down the price of the private services like minibusses.
I was a client of the LA bus system in the 1960's. It hasn't changed.
>>>If you are correct in this assumption, then rational consumers will choose the newer product even if the older one is free.<<<
No. The innovative company never goes into business, most likely. And if they are in a very special niche, then the monopoly never bundled the competing product. Remember that this ploy has been used over and over to keep competition from arising in the first place. Under these circumstances, the cost of entry is higher, extablished de facto standards keep you from selling to corporate buyers, and so forth.
>>>I assume that the predatory scheme by the natural monopolist succeeds and that it then goes back to charging the monopoly price. Consumers are still better off than if there had been no predation.<<<
Once in a near-monopoly position, GM and other car companies institutes planned obsolescense. What most people got was very poor technology, including the exploding Pinto gas tanks.
If a software company forces you to upgrade your hardware to run a new version of their software (or else eventually you can't network, and their product help lines shut down, and so on to force you), how much are you saving. If they use monopoly power to put the maker of your current word processor out of business, and you therefor must upgrade, and lose the ability to use some old documents (I'm not making this up) how much are you saving? What is the value of your own data and applications, which you must now cast aside?) ('It ain't done till Lotus won't run.') What does it cost you to retrain yourself, one employee, or 20,000 employees? Are you happy the new word processor was such a 'bargain.')
>>>I would argue that for the government to use antitrust laws to promote and/or subsidize tehnologically innovative software over crappy, porky software is itself inefficient and improper. In Bork-World, the purpose of antitrust law is to maximize efficiency or consumer welfare, at the expense other desirable objectives, including innovation, when such tradeoffs are necessary.<<<
Like I said, Bork's a dreamer. His thinking is of indirect interest to me at best.
The founders of the country spent a good deal of time thinking about how to use law and government to stimulate technological and intellectual progress. That is because for centuries before the rulers of Europe, for example Louis 14 and 15, Napoleon Bonaparte, Tsar Peter of Russia, and many others had recognized the mandatory nature of the competition to be the best technological engine and intellectual locus. Those countries that didn't have it lost out, in exports, in battle, in whatever.
Ben Franklin and the rest of the boys that started things up here were very aware of this. That's why the bureau of standards, and the patent and copyright laws, for instance, go all the way back to the beginning.
You say it's inappropriate to use antitrust law to further these goals. Why? We use the school system to further those goals. We use immigration policy to further those goals. We use the tax code to further those goals. We even use gunboats to further those goals.
Now the Japanese had a very hands off approach toward technological development until US warships showed up off the coast under Admiral Perry and said basically, 'you are doing business our way or we are using the artillery.' At that point they developed an interest in government-organized technological development that has worked out pretty well for them. (They sure think American free trade and open markets types are a convenient joke.)
The europeans do the same thing to us. In fact, the only reason these countries haven't taken over completely here is that we have set (long ago, in the case of the Dutch and others) upper limits on the percentages they can take over in the US.
You don't think the government should get involved in the technological competition? Well, right now we have a pretty good sized monthly trade deficit that says you are very wrong. There is a thousand years or more of policy results that says you are wrong, from the motivation for the founding of the universities in the middle ages to the organization of MITI and SemaTech and the construction of the Internet by DOD to the breakup of IBM and AT&T.
You say there are examples of government policy that were stupid, poorly executed, corrupt and ill-conceived? You bet. Can you just leave it to private enterprise to develop the new technology and infrastructure? Absolutely not. Should you use antitrust to promote these goals? It's a better tool than most.
Cheers,
Chaz |
