Eh, making customers happy is absolutely still a thing, but it only really applies to smaller companies. Small companies win through superior service, large companies win by being the default option. Once a company is the default option, it comes down to how much profit the company can extract.
The problem isn’t capitalism, but all of the rules both explicit and implicit that benefit large companies over smaller companies. Very rarely does a small company lose due to not having economies of scale (does happen though), usually it’s because of startup costs, and those go up substantially when there’s a large player because of all the barriers in place. For example, ISPs will sue to prevent newcomers from getting established. If you don’t have deep pockets, there are many industries you just can’t get started in.
It used to be that large companies could fail if they royally mess up, but now get just get bailed out. Or they buy their competition so they don’t need to innovate. Or they sue their competitors so they can’t compete. The problem isn’t capitalism itself, the problem is all the nonsense that protects those with more and allows them to bully those with less. The problem is ineffective government.
To an extent, but at a certain point having a lot of capital doesn’t help as much. Capital buys you economies of scale, it doesn’t buy you innovation, and companies tend to get less efficient as they get larger.
The proper counter to large companies abusing their power, then, is something like Universal Basic Income (or my preferred formation, Negative Income Tax), since one of the biggest obstacles to starting a business is being able to eat while the business is growing. That’s a fantastic thing for the government to provide since it doesn’t interfere much with the market. If we had that, I don’t think nearly as many innovators would join up with big tech companies and instead would start their own ventures.
Another big one is cutting corporate protections with size. The larger you are, the less protection you should need, meaning if you break the law, the law can come after personal assets instead of just corporate assets. We should still provide protections for smaller companies though.
The problems you see in government are the problems caused by capitalism through regulatory capture.
Not to mention that there are plenty of inherent problems with capitalism since it just doesn’t work for products bought e.g. only once or twice in your life or where the quality can otherwise not be judged by the buyer before buying.
This isn’t a problem with capitalism, it’s a problem with governments. If we eliminate government entirely (e.g. anarcho-capitcapitalism), there are no regulations, thus no regulatory capture. There are other problems, and that’s where governments should come into play, but they should be as removed from the market as possible to limit the profitability of lobbying.
For example, I’m not happy with the ACA and how it mandates certain minimum coverage, because that encourages companies to meet the bare minimum and profit by hiding as many exclusions as they think they can get away with deep in the agreement. That’s certainly not the intent, but that’s what happens, especially since corporations can lobby to soften language so they can find/create loopholes.
I would prefer one of the following instead:
public option - private insurance would need to demonstrate value in excess of what Medicare provides in order to compete, which keeps them (more) honest
hand out cash for customers to pick their own insurance, and merely require contracts to be easily understandable (and the government would take an active role is prosecuting bad agreements)
But no, we got the middleground, which results in a lot of lobbying and cronyism. IMO, governments should instead place themselves in the role of prosecution, letting the courts (and therefore the public) decide on the interpretation of the law through court precedent. Having government agencies set and enforce rules directly opens the door far too widely for cronyism.
This isn’t a problem with capitalism, it’s a problem with governments. If we eliminate government entirely (e.g. anarcho-capitcapitalism), there are no regulations, thus no regulatory capture
No, in that case you would just have large existing corporations hiring hit squads to kill potential competitors instead which is obviously much better /s The desire to do what regulatory capture does originates in capitalism, not in government, government just turns it from a violent action into one of bureaucracy.
I do believe government is necessary, I’m just saying that the more government is mixed with the economy, the more special interests will be able to interfere. So government should be very careful how it solves problems.
Eh, making customers happy is absolutely still a thing, but it only really applies to smaller companies. Small companies win through superior service, large companies win by being the default option. Once a company is the default option, it comes down to how much profit the company can extract.
The problem isn’t capitalism, but all of the rules both explicit and implicit that benefit large companies over smaller companies. Very rarely does a small company lose due to not having economies of scale (does happen though), usually it’s because of startup costs, and those go up substantially when there’s a large player because of all the barriers in place. For example, ISPs will sue to prevent newcomers from getting established. If you don’t have deep pockets, there are many industries you just can’t get started in.
It used to be that large companies could fail if they royally mess up, but now get just get bailed out. Or they buy their competition so they don’t need to innovate. Or they sue their competitors so they can’t compete. The problem isn’t capitalism itself, the problem is all the nonsense that protects those with more and allows them to bully those with less. The problem is ineffective government.
The fact that the rules benefit those with more capital is a feature, not a bug, of capitalism
To an extent, but at a certain point having a lot of capital doesn’t help as much. Capital buys you economies of scale, it doesn’t buy you innovation, and companies tend to get less efficient as they get larger.
The proper counter to large companies abusing their power, then, is something like Universal Basic Income (or my preferred formation, Negative Income Tax), since one of the biggest obstacles to starting a business is being able to eat while the business is growing. That’s a fantastic thing for the government to provide since it doesn’t interfere much with the market. If we had that, I don’t think nearly as many innovators would join up with big tech companies and instead would start their own ventures.
Another big one is cutting corporate protections with size. The larger you are, the less protection you should need, meaning if you break the law, the law can come after personal assets instead of just corporate assets. We should still provide protections for smaller companies though.
The problems you see in government are the problems caused by capitalism through regulatory capture.
Not to mention that there are plenty of inherent problems with capitalism since it just doesn’t work for products bought e.g. only once or twice in your life or where the quality can otherwise not be judged by the buyer before buying.
This isn’t a problem with capitalism, it’s a problem with governments. If we eliminate government entirely (e.g. anarcho-capitcapitalism), there are no regulations, thus no regulatory capture. There are other problems, and that’s where governments should come into play, but they should be as removed from the market as possible to limit the profitability of lobbying.
For example, I’m not happy with the ACA and how it mandates certain minimum coverage, because that encourages companies to meet the bare minimum and profit by hiding as many exclusions as they think they can get away with deep in the agreement. That’s certainly not the intent, but that’s what happens, especially since corporations can lobby to soften language so they can find/create loopholes.
I would prefer one of the following instead:
But no, we got the middleground, which results in a lot of lobbying and cronyism. IMO, governments should instead place themselves in the role of prosecution, letting the courts (and therefore the public) decide on the interpretation of the law through court precedent. Having government agencies set and enforce rules directly opens the door far too widely for cronyism.
No, in that case you would just have large existing corporations hiring hit squads to kill potential competitors instead which is obviously much better /s The desire to do what regulatory capture does originates in capitalism, not in government, government just turns it from a violent action into one of bureaucracy.
Hence why I said there would be obvious problems.
I do believe government is necessary, I’m just saying that the more government is mixed with the economy, the more special interests will be able to interfere. So government should be very careful how it solves problems.