Tag Archives: monopoly

Why monopolies only survive with the backing of government (Video)

If you really want to understand why the crony capitalist system is so insidious as well as ubiquitous I highly recommend listening to this bit from the master Murray Rothbard. If you really want to get what is so messed up about government and the “privavte sector” partnering up, one must know at least a little bit of his work.

Warning though. Rothbard can rattle one’s whole understanding of politics and economics.

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Governments like monopolies – that they create


Over the medium to long term the only way a firm or a small group of firms can maintain a monopoly is if it has the backing of the government.

If a firm in a free market attains monopoly status, and this can happen, it won’t last as new firms with better equipment, techniques etc. will enter the market. If however a firm can get in good with the government, then the monopoly firm can get its politician buddies to regulate away competition.

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The Cartel That Makes Sure Airplane Tickets Never Get Cheaper

Open this industry up. I don’t mean “deregulation” like in the 1970s. I mean let’s examine why it took forever for Virgin to get routes within the USA. (A fantastic airline by the way. I encourage anyone with the opportunity to fly Virgin to do it. It’s almost pleasant.) Let’s make it easier for international carriers to do business here. Let’s stop protecting the legacy carriers and start getting some of those lay down seats on domestic flights.

As the great economist Murray Rothbard observed, cartels and monopolies don’t last very long unless they are protected by the government.

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The Myth of the Free Market Cartel | by Murray N. Rothbard (Video)

Cartels rarely survive very long without the backing of the government. The big trusts over the years have only continued on over the long term if they had the protection of the state. In a free market with free prices monopolists are constantly undermined by new firms, with newer equipment and better methods. There is no better trust buster than the market.

If however the companies in power at a particular time can buy into the government and create a regulatory moat around their firms the old, less innovative guard can remain in place. A key part of crony capitalism.

Below the master Murray Rothbard discusses this phenomenon in a short excerpt.

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The Myth of Natural Monopoly | by Thomas J. DiLorenzo

Monopolies are usually, almost without exception, instituted by governments. When on occasion a monopoly occurs in a free market (and it can) it is usually very short lived unless that firm can co-opt the government to create a regulatory “moat” around that firm to protect it from competitors. In short monopoly is basically a problem created by governments.

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Salon goes (?) soft-fascist, Frets, Why Uber Must Be Stopped

Months ago I wrote about the “hipster fascists.” These are the folks who hold themselves out to be in favor of new ideas and innovation but in fact find much comfort under the wing of the warm, suffocating, life squeezing, state. Andrew Leonard the author of the attached article, though far too old to be a hipster, strikes me as this sort of fellow.

He cries to the heavens. “Uber is out to take over the world! We must stop it now. Kill this capitalist demon spawn while it is still small enough to kill. Dear Government where are you!!!!”

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Pharma: Hotbed of Crony Capitalism

These recent stories (from The Alliance for Natural Health-USA) are just a small part of the total story of the alliance between government and the drug companies (Pharma).

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