Price fixing - the Feds throw the e-book at Apple

[MiM]

Being the "last man standing" would be a win in your book wouldn't it . Comes from the same place as your "natural law", does it?

As I said, teasing you was fun for a while, now I'll just get back to be

What exactly is wrong with a businessman seeking to drive out his competition so he can have the market to himself? That's the very basis of a free market economy. Rational self-interest.

And talk about your trolls....

Just thought I would provide you with an opportunity to be at the other end of it. Hope you enjoyed it.

As for your question: so much that I don't even know where to start, so I won't, it would only make me rant, and I hate doing that. Even from a pure business strategy point of view healthy competition is good for everyone. Keeps your business innovative and workforce alert.

[Coito ergo sum]

And free markets that are actually free do indeed account for such things through market forces alone. Regulation is not necessary except to regulate the authority of government to meddle with the free market.

This isn't exactly true, as private enterprises can organize to monopolize suppress competition and thus distort the market.

That's not a monopoly. That's market domination. Anyone with the skill and ability to defeat that attempt at suppression can compete in the free marketplace.

That's a simplistic way of looking at it.

No it's not, it's the rational and logical way of looking at it.

it's the uneducated way of looking at it, because you are not looking at the topic realistically with attention to how markets function or with any degree of understanding of economics.

A monopoly can form when a single company effectively becomes the industry, and prices are no longer set by competitive forces, and there are high barriers to entry which effectively preclude competition.

Wrong.

According to you, maybe. But, not according to the the basic concepts of economics.

Because the market price is determined not by the company but by the consumers.

not in a monopoly.

Any company that tries to create a dominant (and even exclusive) market share for a product that prices that product too high will end up bankrupt when consumers refuse to pay what the company demands. Standard Oil is a perfect example.

it's a perfect example of a monopoly that had to be broken up because it was engaging in anticompetitve behavior.

When the Sherman Anti-Trust Act was put in place, oil-based fuel and products were never cheaper. Standard Oil used it's market dominance and huge investment in research, exploration and development to drive fuel prices so far down that other oil producers were unable to compete because they couldn't do it as cheaply as Standard Oil.

And that is what the Progressives and Marxists objected to that caused the Congress to enact the Sherman Anti-Trust Act.

It was NOT monopolistic HIGH prices that was the "problem" government tried to "solve," it was LOW prices that suppressed competition, which the Marxists and Progressives in government objected to. They enacted the law in order to RAISE fuel prices so that it was "fair" to the smaller, less efficient oil companies. Any oil producer however could have cut costs and found economies and lowered the price of their fuel to compete with Standard Oil if they had the moxie, capital and business sense to do so. But they didn't want to, they wanted government protection against fair competition, and they got it, and they got it again with the Apple verdict. It's all about Marxist Progressive notions of "fairness" rather than allow the market forces to operate as they naturally do to deal with overpricing caused by market domination.

Standard oil used anticompetitive tactics to gain nearly exclusive control of refining, distribution, marketing and other aspects of the oil industry. Standard eventually gained control of nearly 90 percent of the country’s oil production. Standard oil was found in violation of the Sherman antitrust act which prohibited “every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce.” The Department of Justice filed a federal antitrust lawsuit against Standard in 1909, contending that the company restrained trade through its preferential deals with railroads, its control of pipelines and by engaging in unfair practices like price-cutting to drive smaller competitors out of business. The Supreme Court ruled against Standard “on the ground that it is a combination in unreasonable restraint of inter-State commerce."

Monopolies can ONLY exist with government sanction of the exclusivity of distribution. Period.

Government makes it easier, but they can exist without government.

This is especially true when a monopolizer uses anticompetitive actions to achieve its goals -- collusion, lobbying governmental authorities, and force, etc. When product differentiation is low that is another indicator of a monopoly. The presence of excess profits for a long period of time indicates a monopoly.

Wrong. You have just proven my point; a monopoly cannot exist WITHOUT GOVERNMENT SANCTION. Lack of "product differentiation" doesn't mean anything other than other potential competitors cannot produce a product that the public finds to be a better value than the original. Apple proves that unequivocally. There are thousands of computer builders out there but only two dominant operating systems, Apple and Microsoft. But there IS COMPETITION, and the price of each is (or should be) determined exclusively by the natural forces of demand from consumers, and nothing else.

Sincere there is market competition, there hasn't been a monopoly in unlawful restraint of trade.

Excess profits tend to attract competitors until excess profits drop to zero, but where they persist for a long time, that indicates anticompetitive behavior.

All market operations are axiomatically, necessarily and rightfully "anti-competitive."

What's your basis for this claim?

The whole point of market economies is that one manufacturer does everything possible to stamp out all competition and all competitors try to do exactly the same thing to gain market share. It is that battle that IS the marketplace.

Not "everything." That's why there are unfair competition laws, and laws against restraints of trade, etc

You putatively mean "unfair" anti-competitive behavior. But what's fair has nothing to do with market forces. So long as the company with dominant (or exclusive) market share does not initiate force or fraud to gain the competitive edge, it's a perfectly normal and valid exercise of market strategy and tactics.

Force, fraud or other unlawful activity. Your anarcho-libertarian view is fine, but don't confuse what you think should be with what is.

The Sherman Anti-Trust Act and other statutes barring "anti-competitive" business practices are a manifestation of pure Socialist dogma, which holds that it's "unfair" for one company to be so good at what it does that nobody wants to buy anything else, and that therefore government is justified in infringing on the rights of the dominant company by enacting laws that interfere with their business strategies and tactics and burden them in order to "give the little guy a chance" or bring "fairness" or "consumer power" to the marketplace.

That's all a clear manifestation of Marxist ideology and nothing more. It has absolutely nothing whatever to do with the operations of the free market.

Not in the least. The Sherman Antitrust Act was part of the reaction to industrialists and financiers of the Gilded Age corrupting American politics; buying presidents and Congresses, and plundering the country's natural resources. It was part of the reaction to the way the robber barons sought to perpetuate their rule--through complex combinations of trusts and monopolies, and the creation of an American aristocracy.

"Our country, this great Republic, means nothing unless it means the triumph of a real democracy, the triumph of popular government, and, in the long run, of an economic system under which each man shall be guaranteed the opportunity to show the best that there is in him. The essence of any struggle for healthy liberty has always been, and must always be, to take from some one man or class of men the right to enjoy power, or wealth, or position, or immunity, which has not been earned. Our government, National and State, must be freed from the sinister influence or control of special interests.The absence of effective State, and, especially, National restraint upon unfair money-getting has tended to create a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power. No man should receive a dollar unless that dollar has been fairly earned. Every dollar received should represent a dollar's worth of service rendered, not gambling in stocks, but service rendered, We need to set our faces like flint against mob violence just as against corporate greed; against violence and injustice and lawlessness by wage-workers just as much as against cunning and greed and selfish arrogance of employers. The fundamental thing to do for every man is to give him a chance to reach a place in which he will make the greatest possible contribution. Understand what I say there. Give him a chance--not push him up if he will not be pushed. Help any man who stumbles. If he lies down, it is a poor job to try and carry him. But if he is a worthy man, try your best to see that he gets a chance to show the worth that is in him."" - T. Roosevelt

[Seth]

Any company that tries to create a dominant (and even exclusive) market share for a product that prices that product too high will end up bankrupt when consumers refuse to pay what the company demands. Standard Oil is a perfect example.

it's a perfect example of a monopoly that had to be broken up because it was engaging in anticompetitve behavior.

In your world evidently "anticompetitive behavior" means being so good and efficient at what they did that they were able to price oil products lower than they had ever been and lower than their competition could manage.

That's the very essence of a free market. Don't you understand that?

When the Sherman Anti-Trust Act was put in place, oil-based fuel and products were never cheaper. Standard Oil used it's market dominance and huge investment in research, exploration and development to drive fuel prices so far down that other oil producers were unable to compete because they couldn't do it as cheaply as Standard Oil.

And that is what the Progressives and Marxists objected to that caused the Congress to enact the Sherman Anti-Trust Act.

It was NOT monopolistic HIGH prices that was the "problem" government tried to "solve," it was LOW prices that suppressed competition, which the Marxists and Progressives in government objected to. They enacted the law in order to RAISE fuel prices so that it was "fair" to the smaller, less efficient oil companies. Any oil producer however could have cut costs and found economies and lowered the price of their fuel to compete with Standard Oil if they had the moxie, capital and business sense to do so. But they didn't want to, they wanted government protection against fair competition, and they got it, and they got it again with the Apple verdict. It's all about Marxist Progressive notions of "fairness" rather than allow the market forces to operate as they naturally do to deal with overpricing caused by market domination.

This statement by me is factually incorrect. The Sherman Anti-trust Act was enacted in 1890 to control trusts, but it was almost never enforced until 1909, the beginning of the Progressive era, when it was used against Standard Oil for reasons of "anti-competitiveness" not trust-busting.

Standard oil used anticompetitive tactics to gain nearly exclusive control of refining, distribution, marketing and other aspects of the oil industry. Standard eventually gained control of nearly 90 percent of the country’s oil production.

Yup, and they kept prices lower than before. How is that bad?

Standard oil was found in violation of the Sherman antitrust act which prohibited “every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce.”

The Act was applied specifically to make what Standard Oil was doing unlawful, which it was not.

The Department of Justice filed a federal antitrust lawsuit against Standard in 1909, contending that the company restrained trade through its preferential deals with railroads, its control of pipelines and by engaging in unfair practices like price-cutting to drive smaller competitors out of business.

That's free market economics at work, nothing more.

The Supreme Court ruled against Standard “on the ground that it is a combination in unreasonable restraint of inter-State commerce."

The Court was acting as the lackey of the Progressive movement.

The Sherman Antitrust Act (Sherman Act,[1] July 2, 1890, ch. 647, 26 Stat. 209, 15 U.S.C. §§ 1–7) is a landmark federal statute on United States competition law passed by Congress in 1890. It prohibits certain business activities that federal government regulators deem to be anticompetitive, and requires the federal government to investigate and pursue trusts, companies, and organizations suspected of being in violation. It was the first federal statute to limit cartels and monopolies, and today still forms the basis for most antitrust litigation by the United States federal government. However, for the most part, politicians were unwilling to refer to and enforce this law until Theodore Roosevelt's Presidency (1901–1909) and beyond.

The Sherman Antitrust Act is named after its author, Senator John Sherman, an Ohio Republican, the chairman of the Senate Finance Committee, who was also Rockefeller's colleague.[2] After being ratified in the Senate on April 8, 1890 by a vote of 51-1, the Sherman Act passed unanimously (242-0) in the House of Representatives on June 20, 1890, and was then signed into law by President Benjamin Harrison on July 2, 1890.[2]

Despite its name, the Act has fairly little to do with "trusts" in the ordinary sense of the term. Around the world, what U.S. lawmakers and attorneys call "antitrust" is more commonly known as "competition law." The purpose of the Act was, to quote Sherman:

"To protect the consumers by preventing arrangements designed, or which tend, to advance the cost of goods to the consumer."
Emphasis added

Standard Oil's activities did NOT "advance the cost of goods to consumers." In fact it did exactly the opposite, it brought costs down to record low levels. As a result of the suit Standard Oil was broken up and oil prices went UP, so in point of fact the Act did exactly the opposite of what it was intended to do.

And that is because it was rarely enforced between 1890 and 1909, the beginning of the Progressive era.

The government assuming authority to "deem" certain business practices to be "anticompetitive" is an INTERFERENCE with the actions of the free market, not a protection of it.

Monopolies can ONLY exist with government sanction of the exclusivity of distribution. Period.

Government makes it easier, but they can exist without government.

No, they cannot. Market dominance can persist in the absence of government support of monopoly status only so long as, and until some competitor, driven by a market opportunity like overpriced goods, successfully challenges that market dominance. See my argument about Microsoft and Apple below.

Monopoly can only exist when the government forbids and enforces a ban on all competition with the chosen beneficiary. Without that government intervention even a 100 percent market share domination is susceptible to the "better mousetrap" functions of a free market. That such "better mousetrap" innovation may take a long time to emerge, or might never emerge is a function of physics, human ingenuity and intelligence, and free market economics.

Consumers determine whether such a challenge arises. If Standard Oil had taken 100 percent control of the domestic oil market and kept prices low, so that consumers were satisfied with the value they were receiving, then there would be no competition because no competition was needed to keep consumers happy.

On the other hand, if Standard Oil drove everyone else out of business and THEN artificially raised the price of oil products beyond what the consumers felt to be a fair and reasonable price, a market opportunity for a competitor to Standard Oil has then emerged, and once exploited, that market opportunity turns into competition that brings prices down.

The contemporary example is how nervous Saudi Arabia is that the US is drastically increasing it's domestic oil production, which is threatening the income of the House of Saud. This US oil exploration is competition and it emerged precisely BECAUSE of the OPEC cartel and their pricing practice.

So OPEC is now on the ropes, just as the principles of the free market said they would be. Now OPEC can either lower their prices to get back in the game, attempt to corrupt our government so that it disadvantages domestic exploration and production, (can you say "Gulf drilling ban and XL pipeline obstruction and "Obama's war on coal") in favor of OPEC.

See, it's government INTERVENTION in the market that allows OPEC to control the oil market.

This is especially true when a monopolizer uses anticompetitive actions to achieve its goals -- collusion, lobbying governmental authorities, and force, etc. When product differentiation is low that is another indicator of a monopoly. The presence of excess profits for a long period of time indicates a monopoly.

Wrong. You have just proven my point; a monopoly cannot exist WITHOUT GOVERNMENT SANCTION. Lack of "product differentiation" doesn't mean anything other than other potential competitors cannot produce a product that the public finds to be a better value than the original. Apple proves that unequivocally. There are thousands of computer builders out there but only two dominant operating systems, Apple and Microsoft. But there IS COMPETITION, and the price of each is (or should be) determined exclusively by the natural forces of demand from consumers, and nothing else.

Sincere there is market competition, there hasn't been a monopoly in unlawful restraint of trade.

My point exactly. You can't have "restraint of trade" unless the government authorizes it. The fact that Standard Oil had dominant market share and the necessary economic pull to make deals with railroads and pipeline companies for exclusive use/rates is NOT monopolistic. Other oil producers can ship by truck or horse cart if they like. Just because THEY don't have the market efficiencies of Standard Oil and cannot swing the same preferential deals does not make Standard Oil a monopoly. That can ONLY happen when the government says to ALL OTHER COMPETITORS, "It is unlawful your you to compete with Standard Oil."

Anything less is merely good business practice.

Excess profits tend to attract competitors until excess profits drop to zero, but where they persist for a long time, that indicates anticompetitive behavior.

All market operations are axiomatically, necessarily and rightfully "anti-competitive."

What's your basis for this claim?

The nature of a free market is that each person engaging in commerce has as his goal and objective to dominate the market and drive out all competition. It is the persistence of competitors that guides the market price and availability of a product. If one manufacturer "corners the market" on a product (like Apple computers) all this means is that no present competitor has enough business acumen to steal market share away from the dominant company.

But that doesn't mean that someone else will not come along and CREATE a new product that WILL compete effectively.

Again, Apple is the perfect example. Apple came along as a poor relation to Microsoft and lagged far behind for decades as Windows took off and took dominant market share through innovation and marketing.

Then Apple upped its game and became a legitimate competitor with Microsoft through it's own innovation and marketing.

Now Apple is accused of being "monopolistic" and "anti-competitive" because it's negotiating exclusive deals with publishers to distribute their content. That's just good business.

No one is FORBIDDEN from competing with Apple. Some other entrepreneur can come along with a better mousetrap and draw business away from Apple just as Apple did with Microsoft. Will it be easy? No, probably not, but what does that have to do with the fairness of the whole situation. Nobody gave Apple a leg up on Microsoft, Steve Jobs had to compete with Bill Gates toe to toe by offering a different and better product at a better value to customers.

If Steve Jobs had never come along (and remember he tried a couple attempts at challenging Microsoft before Apple took off), then Microsoft would potentially have "cornered the market" for personal computer OS software. That doesn't constitute a monopoly because anyone else can show up at any time and call Microsoft to the lists and unhorse it...if they have a better lance.

Force, fraud or other unlawful activity. Your anarcho-libertarian view is fine, but don't confuse what you think should be with what is.

I know what is, and I'm arguing that what "is" is wrong and that it's based in Marxist Progressive principles rather than the normal and necessary operations of the free markets, insofar as government picking winners and losers in the market by calling some things "anti-competitive" in a most inconsistent and hypocritical, and often completely political manner.

The Sherman Anti-Trust Act and other statutes barring "anti-competitive" business practices are a manifestation of pure Socialist dogma, which holds that it's "unfair" for one company to be so good at what it does that nobody wants to buy anything else, and that therefore government is justified in infringing on the rights of the dominant company by enacting laws that interfere with their business strategies and tactics and burden them in order to "give the little guy a chance" or bring "fairness" or "consumer power" to the marketplace.

That's all a clear manifestation of Marxist ideology and nothing more. It has absolutely nothing whatever to do with the operations of the free market.

Not in the least. The Sherman Antitrust Act was part of the reaction to industrialists and financiers of the Gilded Age corrupting American politics; buying presidents and Congresses, and plundering the country's natural resources. It was part of the reaction to the way the robber barons sought to perpetuate their rule--through complex combinations of trusts and monopolies, and the creation of an American aristocracy.

And it was virtually never enforced until 1909, the beginning of the Progressive era, and then it wasn't enforced against "trusts" or "cartels" or "monopolies" it was enforced as a government-determination of what is "fair" in the marketplace, with "fair" being defined according to socialist and progressive principles.

"Our country, this great Republic, means nothing unless it means the triumph of a real democracy, the triumph of popular government, and, in the long run, of an economic system under which each man shall be guaranteed the opportunity to show the best that there is in him. The essence of any struggle for healthy liberty has always been, and must always be, to take from some one man or class of men the right to enjoy power, or wealth, or position, or immunity, which has not been earned. Our government, National and State, must be freed from the sinister influence or control of special interests.The absence of effective State, and, especially, National restraint upon unfair money-getting has tended to create a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power. No man should receive a dollar unless that dollar has been fairly earned. Every dollar received should represent a dollar's worth of service rendered, not gambling in stocks, but service rendered, We need to set our faces like flint against mob violence just as against corporate greed; against violence and injustice and lawlessness by wage-workers just as much as against cunning and greed and selfish arrogance of employers. The fundamental thing to do for every man is to give him a chance to reach a place in which he will make the greatest possible contribution. Understand what I say there. Give him a chance--not push him up if he will not be pushed. Help any man who stumbles. If he lies down, it is a poor job to try and carry him. But if he is a worthy man, try your best to see that he gets a chance to show the worth that is in him."" - T. Roosevelt

And there it is. Thanks for proving my case absolutely. This is nothing more or less than the Progressive-socialist manifesto from the progenitor of Progressivism. His successor, Woodrow Wilson, took it much further, as did FDR with his New Deal Marxist Progressive agenda.

That speech is a perfect example of Marxist Progressive bloviating and propaganda. Every highlighted section is a paraphrase of the Marxist dialectic.