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The death of civil society?

Londoners are to be asked what they think about using force to prevent people smoking in ‘public’ places (meaning privately owned places to which members of the general public may choose to enter… or not enter).

I do not smoke, though I did puff on a Havana recently, and I generally do not like smoke filled rooms. However, I do not have anyone holding a gun to my head forcing me to go into a smoke filled room against my will or compelling me to take employment with someone who allows people to smoke on their private property (such as a restaurant or bar owner). And yet millions of people see nothing wrong with legitimising threats of violence against others to force them to not smoke for nothing more than their personal convenience.

To take the view that replacing social interaction (such as deciding to walk out of a bar because it is too smoky or quitting your job because you dislike smoky environments) with political interaction, namely agreeing that people can be dragged off to jail by armed men because they smoke in places you would like to enter as a matter of your discretionary ease, is nothing less than taking the view that imposing your convenience by force (and we are not talking prohibiting robbery or murder here) is okay, because anything done via political process is okay. This is what is really meant when people like George Monbiot talk about ‘a more democratic society’… what they really mean is a society in which all interaction is political rather than social.

The genius of the US Constitution was not that it brought forth democracy, albeit one which countenanced slavery (for Britain was also a democracy of sorts in 1776), it was that at its core the revolutionaries tried to place whole swathes of civil society simply off-limits to political interaction… such as free speech, the means of self defence, being secure in your property etc. It recognised that liberty can only exist within the context of a functioning extended civil society, which means the messy melee of free association and disassociation, private ownership, trade and freely entered into contract, actions constrained and encouraged by social imperatives and opprobrium, rather than the stern violence backed impositions of politically derived law.

For a minarchist such as myself, I see a role for democratic politics as a means of constraining the minimal state that even I concede is required to keep the barbarians from the gates of civilization. Yet until democratic politics is once more seen as underpinning a free republic and not an end in and of itself, most politics must seen as a baleful thing and the people who practice it professionally as legislators little different from Mafia Dons dispensing patronage amongst the people under their ‘protection’

In many places across the Anglosphere, civil society is dying under the cumulative pressure of decades of regulatory statism. “There ought to be a law against it” comes to the lips of anyone who dislikes anything…and yet at the same time the moral authority of states is decaying with trends pointing to ever less people choosing to participate in political processes in an ever more affluent and information rich civilization. This is one of the central contradictions of our modern information age and sooner or later those contradictions will cause something to give in ways that cannot be reliably predicted.

38 comments to The death of civil society?

  • Well done Perry, this is one of the clearest statements of the libertarian position on the smoking issue. It is a position scarcely understood, even by those who claim to support the free market, and practically never articulated in debate. Listening to this being discussed on the radio this morning the debate, as ever, was conducted along the lines of the so-called ‘rights of smokers’ or the so-called right to enjoy clean air.

    Really we should not even try to encourage ‘debate’ on these things at all. The very idea of a ‘public debate’ accepts the hidden premise that ownership of private property should be subordinated to the caprice of the majority. Democracy is in conceptual opposition to liberty and increasing it or encouraging more of it means less liberty. That this sort of thing was going to happen was apparent from the moment that the idea of a mayor for London was accepted. It is not a question of left-wingers like Ken or right-wingers like Bloomberg being in charge as they all end up being channels for pressure groups to exert their power urges. The actual smoking itself is a smokescreen for the real issue at stake which is the right of a property owner to dispose of his property as he sees fit.

  • We have a workplace-smoke-ban* looming here in Ireland and what frustrates me most of all in this debate is that it is almost exclusively carried out without reference to the implications for ordinary freedoms and, as you put it, civil society.

    There is either this utilitarian argument: “This will cost the economy” or an argument about health risks of “second hand smoke”. Most frustrating of all is the notion that a “correct balance” be achieved between the “rights” of smokers and non-smokers. There is no argument from principle. Non-smokers are all for it and smokers (and publicans) are mostly against it. It seems to be taken for granted that it is appropriate for governments to take crude measures such as these, and the argument is just about the finer points of implementation.

    I think part of the problem with these issues is the conflation of “rights” and “freedoms”. I try to avoid using the term “rights” at all. Freedoms are simply assumed. “Rights” connotes an entitlement (which is inevitable funded by coercing someone else to pay for it). So instead of a freedom to smoke and a freedom to avoid smoky places or the freedom to tell someone you think their smoking is rude or inappropriate we have the “rights” of non-smokers versus smokers. Political debate would be immeasurably enhanced if more distinction was made between “rights” and “freedoms”.

    * Ireland’s Health and Safety Authority even flag the possibility of smokers who employ people in their own home being prosecuted and encourage “snitching” (by children, or even nosy neighbours?) with a confidential “hot-line”!

  • Sorry, broken link above. This is me being frustrated about this argument.

  • Duncan

    The london smoking survey is at http://www.thebigsmokedebate.com. I tried to fill it in, but there was no option for “The smoking policy should be at the discretion of the owner”, so I filled in the comments bit instead complaining that I couldn’t fill in the survey because there was no option for “The smoking policy should be at the discretion of the owner”.

  • Thanks for the link Duncan, this ‘debate’ is an utter disgrace from start to finish. This is not ‘consultation’ it is a softening up exercise.

  • Charles Copeland

    Nothing much to add to the previous comments except to say ‘spot on’.

    In Ireland, of course, the problem may be partly due to the brain drain. As you probably know, the average IQ of the Irish breeding population ….. OK, OK, I’ll lay off…

    Now a little quiz. What does X stand for in the following citation?

    “The X government was known, and admired, for implementing the most progressive public health policies in their time. State-of-the-art research and regulation were applied to occupational, environmental, and lifestyle diseases. Cancer was declared “the number one enemy of the state.” X policy favored natural food and opposed fat, sugar, alcohol, and sedentary lifestyles. The existing temperance movement against alcohol and tobacco became more active under the Xs, who were involved in what [the author] calls “creating a secure and sanitary utopia.”.

    Most of you have probably guessed what X stands for. If you haven’t, seek here.

    Editors note added: as mentioned when you enter comments below, please use the correct code for links in the comments section so that they open in a new window

  • On the website of the bigsmokedebate, we are told that after the debate:

    “The results will be presented to the Mayor, Ken Livingstone, and the members of the London Health Commission in January 2004. Although the Mayor does not have legislative power to restrict smoking in public places in London, he is committed to acting on the results by working in partnership with groups across the capital to increase Londoners’ access to healthier, smokefree venues.”

    So _before_ the results are even in we know that the mayor is _already committed_ to ‘increasing access to smokefree venues’ (bullying the owners of bars and restaurants to ban smoking). How does the mayor know prior to this alleged act of consultation that the result will favour this course of action?

    This debate is an utter sham, a waste of money, an attack on property rights and a ratcheting up of statism. The entire exercise is suffused with stomach turning cant.

  • Verity

    Agreed, Paul Coulam. There’s a reason Ken does not have legislative powers to restrict smoking in “public” places … no one gave him such powers. So he will simply take them under another guise: “working in partnership” – in other words, bullying. Citizens of London ought to be severely alarmed that Livingstone is arrogating powers unto himself that he was not specifically given and should stop him. And yes, Paul, you spotted their overweening, arrogant, officious mistake: Before the results are even known, we know that Livingstone’s committed to acting on those results “in partnership” with like-minded bullies. In other words, if the results are public indifference, they will be manipulated to read as a mandate for action by the Smoking SS. I daresay Trevor Phillips, who displays Communist memorabilia in his taxpayer-funded office, will be a volunteer for that Nazi team.

  • 1. Smoking kills.
    2. Passive smoking kills.
    3. People smoke.
    4. People smoke in public places – hence they are called ‘public’.
    5. People have rights.

    I can choose to work in a bar, or I can choose not to. But in choosing a profession or job should I also have to make a choice about my health? Why should I have to choose whether or not I work in a healthy environment?

    Surely everyone has a *right* to work in a healthy environment? If you work in an office and a no-smoking policy has been implemented by your employer, is that an attack on your civil rights, or an attempt to either stop litigation, or save the health of employees?

    Equally if people work in public places, and believe it or not people do, do they not also have the right not to be exposed to a smoke environment?

    I should not have to decide that I can either a) work in a healthy environment, or b) work in an unhealthy one. All working environments should be healthy. If it was a matter of choice not many people would work in bars – but they do, and smoke is an extremely unhealthy side effect.

    Perry, saying that inhaling second hand smoke is a matter of personal inconvenience, rather than a direct effect on my health is to miss the point.

    I don’t think the State is being heavy handed in Ireland. If people want to smoke, fine, but do it where it only affects the health of the person who chooses to smoke, and their fellow smokers. If you want to smoke around people who are working in public places then tough. Get over it.

  • Gavin,

    When someone takes any decision they must decide for themselves what risks are involved, weigh them against the benefits they expect and proceed according to their own best estimate of their interests. Whether this is in taking a particular job in a bar, choosing to go for a drink in a particular bar or anything else.

    The job of working in a particular bar is in the personal gift of the bar owner. He may offer it to whoever he likes on whatever terms and conditions he likes. A prospective employee, or indeed customer, can choose to accept or not those terms and conditions. This is how the free market operates. Any imposed interference in this process undermines the autonomy of the free parties to the transaction, distorts the rational expectations of consumers and investors, undermines property rights, destroys welfare, increases politicisation, celebrates violence backed force, erodes civil society, mocks freedom, limits choice, closes down options, makes waste and obviates personal responsibility.

  • Gavin, you have fallen into a few logical traps

    1. Smoking kills., Ok

    2. Passive smoking kills., Maybe

    3. People smoke. , Ok

    4. People smoke in public places – hence they are called ‘public’., No. This is a problem of language.It depends on whether you mean “publicly owned” or “publicly accessible”. There is a difference and those who would justify a ban in “public places” knowingly confuse both meanings.

    5. People have rights. Says who? This is the reason why I dislike the term “rights”. I might well declare that I have a “right” to mashed potato. Just because I have the freedom to buy or make my own mashed potato doesn’t mean that I have a right to it (which should be guaranteed by the government)

    “Surely everyone has a *right* to work in a healthy environment? If you work in an office and a no-smoking policy has been implemented by your employer, is that an attack on your civil rights, or an attempt to either stop litigation, or save the health of employees?”

    This is another example of the problems inherent focusing on “rights”. If your employer decides on a no-smoking policy, which they should be perfectly free to do, you have the “freedom” as a smoker to decide for yourself whether you want to stay working there. There is no conflict. Likewise with an employer who allows smoking on premsies. The problem arises when the government determines that a no-smoking policy applies without reference to the employer or employees.

    “I don’t think the State is being heavy handed in Ireland. If people want to smoke, fine, but do it where it only affects the health of the person who chooses to smoke, and their fellow smokers.”

    I’m afraid, Gavin, that it is you who misses the point. This is not really about smoking at all but whether we want a government which micromanages normal social interaction. You accept the principle that it is ok for the government to “ration” and regulate the way that smokers smoke. This principle could apply to all sorts of quotidian activities: If people want to listen to music, fine, but only do it between 6PM and 9PM so that it doesn’t interfere with economic productivity or neighbour’s sleep patterns. You want to watch kung-fu movies?, fine, but these movies lead to violence in society so it is not “heavy-handed” to require you to stick to a quota of three movies a week.

  • Verity

    Dear Gavin, or may I address you as Mr Intolerance? If you “choose” to work down a coalmine, you will have to accept that you will be working underground and breathing in coal dust. If you “choose” to work as a ship’s steward, you will have to accept that you will be spending most of your life on the high seas and be vulnerable to sea sickness. People who “choose” to work in a bar accept that they will be working in smoky surroundings. The world is not going to bend to your personal will and attend to your comfort. Cruise liners aren’t going to turn themselves into non-floating hotels in permanent drydock lest you suffer from seasickness and the breadth of your career choice be thus diminished.

    By the way, is it OK for people who visit bars to drink, or does the second hand smell of whisky breath nauseate you? We can always ban it and only serve non-alcoholic beverages if that would suit you better.

    You don’t want to work underground, on the high seas or in a smoky environment? Avoid those careers. By the way, the myth of passive smoking is just that: a myth concocted by the antismoking industry. My goodness, Gavin, lighten up! Or, in your own tolerant words, get over it.

  • Goblin

    Damn, have you Samizdata guys been eatin’ chilis or something today cause you are HOT!!?!! I haven’t seen as many great articles in one day here for months!

  • fnyser

    RE: party X

    first they came for the smokers, and I did not speak out because I was not a smoker

    then they came for the carnivores, and I did not speak out because I was not carnivorous

    then they came for the couch potatoes and I did not speak out because I was not a couch potato

    Then they came for me and there was no one left to speak out for me.

  • Howard shaw

    So would you guys be happy for the rail companies that own the stations & the property companies that own the shopping malls to ban smoking in their properties?

  • toolkien

    What has gone unexamined so far is what form would this force take? To what extent will force be used? It certainly would be ironic if they had to use tear gas to breakup an association of people smoking.

    As for the notion of ‘public’ places, that is going to be the great undoing of private versus public sector and the ultimate undoing of private property in conjunction with private association. The definition of public place is now so obscured that it includes private associations as it is beyond the scope of an individual in their primary residence. Any assemblage of people is considered a public association and subject to public authority and regulation regardless that no public funds are used in the association. The most recent example I can think of is Augusta National Golf Club which has excluded women from membership (but not from access). Alarmingly high numbers of people feel that it is ‘public’ enough to allow invasion in, and regulation of, of membership, and therefore the freedom of members to choose with whom they associate. The precedent of course was set years ago when the State forced private Men’s Associations to include women, estensibly because business relationships were fostered and affirmed there and exclusion of females injured their ability to compete. Smoking is simply another example of this phenomena. Freedom is ultimately sacrificed to the God of Correctness.

  • Howard Shaw: I have no problem with a company making that decision at all. I assume many would as clearly that is what the market wants them to do at the moment.

  • R. C. Dean

    Gavin sez: If you work in an office and a no-smoking policy has been implemented by your employer, is that an attack on your civil rights, or an attempt to either stop litigation, or save the health of employees?

    The policies that may be voluntarily adopted by a private employer are of no concern to me, and should be of no concern to the state. These policies are not an attack on my civil rights because they were voluntarily adopted by a private organization.

    Red Ken, on the other hand, is making those policies his concern. His attempts to dictate the terms of the employment contract is a violation of civil rights, and his use of government power to do so is very much my concern.

    The distinction is between private/voluntary and state/compulsory. I allow private individuals to do all sorts of things I would not allow the state to do, and I suspect you do as well.

    So would you guys be happy for the rail companies that own the stations & the property companies that own the shopping malls to ban smoking in their properties?

    If they did so voluntarily, sure.

  • Abby

    The Augusta Golf Club hysteria (midwived by the NYT) is simply proof that the feminist movement is running out of mice to launch missiles at. NOW should be disarmed at once and should have its burning bras confiscated.

  • rc


    Hehe, agreed, Samizdata in is on FIRE lately. This is a very well expressed post, but the last dozen or so have been really refreshing. Great job Samizdata! This is the most interesting blog since Hamilton, Jay and Madison ‘blogged’ in ‘The Federalist’ 200 years ago.

  • Howard Shaw

    Perry- thank you for answering. So property rights come before any other liberties.

    It seems to me that, in some cases, property rights can in fact decrease freedom rather than increase it. Perhaps I’m changing the subject but it makes me curious what is your attitude to monopolies? Do you approve of the Monopolies Commission in the UK and Anti-Trust legislation in the US?

    It would seem that if the state cannot legislate then individuals could come under the mercy of one or a few private corporations who might own all the pubs/restaurants & impose there own rules.

  • Ah, that old fallacy… effective monopoly is unsustainable for more than a short time without the use of violence, i.e. when a company can use force because there is no legal structure to protect the weaker party from violence by the monopolist (such as in Russia today) or because the state is raising the barrier to market entry with laws (the way it almost always happens in the developed world).

    The only way Microsoft maintains a near ‘monopoly’ in some areas of the desktop market is paradoxically not exercising ‘monopoly power’ to jack up prices… which then begs the question is MS really a monopoly in any meaningful sense of the word? Other monopolies in history are nearly always the result of the state granting exclusive rights, not as a result of market forces.

    No, I do not approve of Monopolies Commission in the UK and Anti-Trust legislation in the US, but the reason for that is that I do not approve of the distortions in our economies which make them necessary in the current environment… which is to say mitigating the effects of the distortions caused by the state preventing free flow of capital via regulatory statism.

    And as for the unlikely notion one or a few corporations could impose their rules on all the local bars and restaurants… how is that worse that the state imposing their rules on all the bars and restaurants? If there is a demand for smoking bars and restaurants and for some bizarre reason the evil mega-corps insist on smoke-free, all that does is provide an entrepreneur with a gold biz opportunity to open ‘Smoky Joes Cantina’ (or ‘Smokeless Joes Cantina’ if it is the other way around). When the state legislates a one-size-fits-all mandatory ‘solution’ however, that cannot happen. It is hard to sustain the notion that without regulation an oppressive monoculture will set in under corporate rule… the evidence for exactly that happening under regulatory statism, however, is rather more compelling.

    And which other liberties are you talking about?

  • Howard Shaw

    Perry, I’m not sure I understand your argument why monopolies could not come into existence without violence. Are you talking about physical violence? Surely a monopoly could come into existence by a single entity purchasing all the pubs/restaurants. Why would violence be required? This is not fanciful. In the UK, without the Monopolies Commission, a company like Bass could well be in a position to own at least a vast majority of pubs (by purchasing them, not physically evicting the owners). Smoky Joe could then be discouraged from setting up in competition because mega-corp. could create all kinds of (non-violent) barriers to entry. (buying up potential sites for example).

    One difference between a single company imposing its rules and the ‘state’ or a local council is that the latter, in a democracy, regularly subject themselves to election.

    By one size fits all I presume you mean a universal smoking ban? I certainly wouldn’t favour that, whether imposed by a monopoly owner or the ‘state’. However, legislation could take other forms such as differential pricing in the issue of licences. This would serve to encourage the establishment of non-smoking pubs thereby increasing choice. In the UK there are virtually no non-smoking pubs.

    The other liberties would of course include the freedom to smoke!

  • Howard: I think you misunderstand the Libertarian objection to a smoking ban. It has nothing to do with the “rights to smoke” (a right which could plausibly be “balanced” by a “right” of non-smokers). It is to do with the government intervening into an agreement to which both parties consented. Thus

    Party 1: I agree to give you a job where you will be exposed to “second hand smoke”

    Party 2: I agree to take up this job

    Government: This is not acceptable

    It works just as well the other way if the government required your private companies to provide smoking areas

    Party 1: I agree to provide enclosed access to trains/shops/whatever on the understanding that no smoking will be permitted

    Party 2: I’m happy with that

    Government: Well we are not!

  • Because in the real world, no monopolist can actually afford to buy up ‘all the sites’ or all the pubs and restaurants unless they want to go broke. What is more, even if they somehow did, if they ran their operations in such a way that they did not satisfy the market (for example they jack up prices or they allow/disallow smoking), then someone else will just start up a rival business to cater to the disaffected sections of the market… unless something stops them from doing so (which usually means regulations such as liquor licences, planning laws etc.).

    In reality, Bass owes its market dominance to the fact it is an expert not in the boozer industry but at navigating the thicket of legislation, licences and other barriers that englobe Pubs. If you don’t believe me, just try buying an old chipshop, gut it and then set up a pub called the Howard Arms and see what your local authority does to you. In principle setting up a pub is not exactly rocket science… yet in reality, it is an incredibly complicated thing to do. If it was a simple matter, there would be a great deal more small players and a more effective market.

  • Howard: The reason violence would be necessary is because “buying up potential sites” would be an expensive and ultimately unsuccessful method of deterring new entrants to the market.

    Let’s say you buy up all the pubs. What is to stop me setting up a shebeen in my front room? I’d say it would be your bunch of goons threatening to torch the place.

    “One difference between a single company imposing its rules and the ‘state’ or a local council is that the latter, in a democracy, regularly subject themselves to election.”

    Here’s another difference: a local council devolves all of its operation to bureaucrats with protected positions. A private company lives or dies by its customers. If the product isn’t good enough it will go out of business. A local council worker can quite happily tell his “customer” to “go and screw himself” if the product isn’t good enough. Voting out the councillors at the next election won’t make the slightest difference.

    Oh, and the freedom to smoke isn’t much use to you if you don’t own the cigarettes, that’s why “property rights” are important

  • Howard Shaw

    Thanks for the replies.

    Perry – Your arguments strike me as containing an element of wishful thinking. Why would the monopolist go broke? He could be the most powerful single entity in the country. Such tactics are just the type that cartels & monopolists do get up to when given the chance.

    someone else will just start up a rival business to cater to the disaffected sections of the market…

    But the point is someone else can’t just set up a rival due to the (legal, non-violent) behaviour of the monopolist. He is in a position to create the biggest barriers to entry, not the ‘state’.

    Say there is a monopolist or cartel and they contract with a supplier as follows:

    Monopolist: I will buy your pork scratchings as long as you don’t supply to Smoky Joe.

    Supplier: I agree.

    Is that an okay contract?

  • “Why would the monopolist go broke? He could be the most powerful single entity in the country”

    You would have to own the whole country to buy up “all potential” sites. No company could afford that and there would be no significant benefit to doing so. What those who are “critical” of capitalism fail to realise is that you don’t need to be a monopoly to make money.

    Monopolist: I will buy your pork scratchings as long as you don’t supply to Smoky Joe.

    Supplier: I agree.

    Yes it is an ok contract. Presumably “supplier” is not also a monopoly provider of pork scratchings and is happy to be reliant on one big customer, so Smoky Joe can go get his scratchings somewhere else.

  • Johnathan Pearce

    On the money, Perry! I think one or two commenters above who spoke of the “right” to work in a place free of smoke or some such unpleasant feature are claiming something bogus. I do not have a right to work in a place that conforms to standard X or Y. When folk use the word “right” in this way, they deviate from the classical liberal definition of right, which is negative prohibition against the initiation of force, and transform it into a claim, which can only be enforced by coering other people, seizing their property, etc. This is an example of how the language of rights has been gradually subverted since the 19th Century.

    True, it may be inconvenient for a student trying to get a dayjob to work in a pub where folk smoke, but that student does not have a “right” to impose his/her preferences on the owners of the pub, and its would-be clients.

    Property rights are often disparaged by collectivists and nanny statists of various kinds, but ultimately, property rights are essential in enabling precisely the kind of varied lifestyle preferences Perry spoke about without having to impose a one-size fits-all policy on stuff like smoking.

  • R. C. Dean

    Howard – perhaps if you could provide with an example of a monopoly that was sustained over time without either (a) the use or threat of force against competitors, or (b) significant government support or barriers to entry, you could ground your arguments in the real world.

    As far as I know, monopolies are unsustainable in a functioning market, for the reasons given above. Monopolies rely on artificial barriers to entry, whether they are legal/regulatory or more crude.

    What this has to do with the smoking ban and civil society, I have no idea.

  • The Wobbly Guy

    Barriers to entry? How about massive amounts of capital which most people are unable to obtain?

    And wasn’t there a period in US history when a oil/transport monopoly had to be broken up by the government, because it would likely be self sustaining? Something to do with Rockefeller, IIRC.

    On the issue of smoking and bans, well, my country is almost as bad as Ireland. In fact, we could probably stand for ‘X’… better than Nazi Germany itself, I might add.

    But the government recently seems to realize the usefulness of escape valves, and therefore takes extra pains not to antagonise the people with overly oppressive alcohol and smoking laws.

    The law of unintended consequences can be seen most clearly as the local youth regards smoking as a show of rebellion, and smoking is becoming more popular amongst younger people.

    I see the data, and though I’m not a smoker myself, chortle at the irony…

  • Massive amounts of capital to do what? Open a pub? Why would that take lots of money? And if the market is there and you come up with a business plan, have you ever heard of getting a bank loan? Or find a venture capitalist if the business is a bit more outre! Good ideas generally attract good money. And if you are talking about competing with oil or transport companies, well the people who would leap to compete with them if they distorting the market with monopoly pricing are… other oil and transport companies atttacted to take some of the action, thereby destroying the monopoly… and as markets become ever more global, the idea a well capitalised company can stomp all comers becomes ever more preposterous… provided the state does not stop well capitalised foreign companies from competeing with local would-be monopolists.

    If you ever what to really see what happens to folks who think they are bigger than the market, I suggest to you that no one is bigger than the market.

  • The Wobbly Guy

    Rather than trying to imagine what might happen, I think I’ll just observe and laugh when a worldwide monopoly DOES arise. It may not be as far fetched as you think.

    Dogmatic adherence to a personal belief doesn’t always match up to reality. I prefer to take a more descriptive view of matters, and from what I see now, particularly in the case for Microsoft, is that a ‘near and almost total’ monopoly is not impossible. Barriers to entry, especially as technology becomes ever more advanced, tools become more expensive, and the sort, would only continue to increase. Loans and venture startups are overrated.

    Large and efficiently run companies can certainly stomp out their competitors, especially when there are huge economies of scale to be gained. The firm which gets to be the largest first gets a headstart, allowing it to boast lower prices, and then it’s a vicious circle which leads to a monopoly(or near monopoly). If the economies of scale are structured in such a way that with technology can lower costs even on a global scale, what’s to prevent a single megacorp(sorry, been on a binge of cyberpunk RPG) from cornering an entire market?

    Which leads to the interesting point you raised. What DO we define as a monopoly anyway? 90% of the market share? 95%? 100%? The ability to dictate prices? What exactly is a monopoly? If a firm has 100% of the market share, but refuses to dictate prices(in effect cutting out all and any competitors’ chances of offering services at lower price), could it be considered a monopoly?

    Even more interesting… Is a monopoly, or near monopoly, a bad thing to have at all?

  • WG: You are just operating on the basis of faith as far as I can see… if ‘reality’ is what your remarks are based on, then give me some examples of long lasting non-state imposed monopolies on other than the most local level please.

    The facts are that as technology advances, tools tend to be cheaper, rather than more expensive and information vastly cheaper, so the whole canard of economies of scale makes little sense at all on all but a few industries. In fact being the first entrant in a technology in the long run often sets companies for vastly capitalized obsolescence when someone else comes up with something better, as inevitably someone does.

    Also, my considerable experience dealing with businesses makes me suspect the terms large and efficiently run are mutually exclusive when it comes to companies. Sure, companies can stomp on competitors, that is what all companies try to do and I have no problem with that… but in modern more-or-less capitalist economies, NO ONE is bigger than the market in the not-so-long run. Pay less attention to hackneyed received wisdoms and look around at the diversity of businesses and products in any real world major city, not the ones in cyberpunk books.

  • The Wobbly Guy

    Examples? You said it yourself. Microsoft. By no means a complete monopoly(yet), but how many companies can compete with them?

    If writing code and getting qualified programmers is that simple(it actually is), then why hasn’t anybody managed to overcome it? You could say it has a lot of competitors, but they’re just currently blips on the radar.

    Your statement that technology is becoming cheaper is also quite untrue. If that was the case, we’d see silicon wafer plants popping up everywhere. Technology is still highly restricted in terms of capital, and the more high tech it is, the more expensive it will be. But perhaps you’re right, and this will change. But stuff like basic research will still remain expensive. Sigh. Time was a scientists could conduct his own research on his own funds, but now…

    As for economies of scale, it’s not so easily dismissed. And technology itself can put lie to your notion that being large means being inflexible. A large efficient company can certainly overturn inventory if the employees are sharp enough. If technology is indeed cheaper as you have said, what’s to prevent a large company from overhauling a section and converting to the new tech, while buying the new inventory at cheaper prices(in bulk), while undercutting the newcomers on the goods and services side? After, they’re BIGGER, and can absorb the risk more easily. More importantly, they can sit back and observe the newcomers, then go in with full force once the concept’s been proven. Example? Netscape.

    Large and efficiently run are mutually exclusive? Is that true for all large companies? Hell, they don’t even need to be 50% efficient, if they can still offer lower prices. You can be 100% efficient, and sell products at say $10. Somebody else a hundred times bigger is only 50% efficient, but offers the product at $8. Well, they might be less efficient, but who’s winning the market?

  • Microsoft isn’t a monopoly or anything like it. I hate their products and am a devoted Mac user but you are missing the point about Microsoft’s rise to its dominant position.

    IBM’s idea was that every big company would have one big computer. Steve Jobs’ idea was that everybody would see how insanely great the Mac was and wouldn’t mind being ripped off for the privilege of owning one. Bill Gates’ idea was that every home would have a PC.

    If it hadn’t been for Microsoft’s aggressive strategy Apple would still be ripping me off with even higher margins than they have today and you can bet that they wouldn’t have bothered with any of their recent innovations. Competition forced them to offer a better product once their beige boxes were emulated by a Wintel PC. Cheap and inelegant wins over expensive and elegant every time.

    Bill Gates only wants Microsoft to be as successful as possible, he doesn’t care about anyone else but that is the beauty of competition and the free market, his “selfish” action forces other players to improve their product, offer a niche-product or drop out.

    Netscape is a complete red herring. They took a big gamble that by giving their product away for free they could build market share and then “corner the market”. They lost, big deal. I’m typing this through Apple’s “bug-infested browser” Safari. There are plenty of alternate browsers to Internet Explorer, as there are for all of Microsoft’s software products. Once formats become standard it doesn’t matter which software package reads or writes to that format.

  • John Ellis

    Well said, Perry. A very cogent statement and one I agree with too.

    By the way, you are DEFINITELY a “minarchist” now, are you? There was a anarcho-libertarian phase last year and I was getting a bit worried for you…;-)

  • I loved your article it gave a good view on your point but im a smoker and yet everything has a problem and some cannot be resolved. for the paper i am doing for school i will use some comments and i thank you very much.