MLM Directory - are monopolies bad for capitalism?

are monopolies bad for capitalism?

I hear a lot of people recently talking more and more about free market, but they tend not to answer questions regarding monopolies. But in free markets, I think monopolies are a very important topic. I'm curious how the Tea Party feels about the gigantic business entities in the US. Let's not focus on small business or even medium sized businesses right now. Let's talk mega-corporations. Well, aren't monopolies essentially the same thing as having socialism? By definition, they destroy competition. True or false? How do tea party supporters think monopolies should be dealt with? While I know the Tea Party is for smaller government, could the government intervene to split them up into smaller companies to promote more competition-- would this actually be a good idea? i don't know. I think we can definitely all agree though that the role of government should be to secure property rights and enforce good laws. Government certainly can have a role in helping to produce competition. Laws should be created to prevent very large mega corporations from arising. Can we all agree on that?

Public Comments

yes, monopolies crush competition and lead to high prices for cosumers look at the oil industry, and health insurance...both monopolies and both gouge customers cause they can
Monopolies are bad for the consumer. No competition means higher cost. However the longer a company can maintain a monopoly or oligopoly the harder it will be for future competitors. Take Microsoft for example, they nearly had a monopoly for quite some time and now they have an advantage on their products. E.g research/development funds, long-term business relationships etc.
Generally, monopolies are the opposite of a free market. It is unusual for a free market to create a monopoly. Monopolies generally arise due to somebody interfering with the free market.
Conservatives and the Tea Party aren't necessarily against all regulations. We just want minimal regulation as possible, so that people aren't burdened by unnecessary rules.
Free enterprise is great and leads to competition, innovation, etc. But, the goal of all companies is to be number 1 in their industry, and preferably the only one. Oil, phone, and other monopolies were broken up by the Government in the past.
Monopolies are the natural result of a 'free-market.' They are inevitable. The only thing that breaks up monopolies is govt. gws has it bass-ackwards AGAIN. Use logic people, think. He's just spouting nonsense that someone spouted to him. THINK
Yes, they destroy competition. Monopolies rarely arise in free-market economies unless there is a very specialized market. It is very difficult to drive all competitors out of business. Giant coercive monopolies have never existed without government intervention and subsidies. standard oil was accused of being a monopoly because they brought the price of oil to unprecedentedly low price levels and other oil companies just couldn't keep up, but the point is there was competition otherwise there would be an absence of competition and prices would be high. @Dave87gn: those are examples of oligopolies. They all collude together to set a price.
@gws that is completely false. The goal of every business is to make as much proft as possible in a free market. Therefore, competitors, over time, will fail or join with the powerful, better company to maximize their profits. Pretty soon, there is a monopoly, dipoly or tripoly (if those are words) of a certain industry. There needs to be a balance of government and capitalism in the markets in order any capitalistic country to be successful.
Monopolies are always bad for people. Without heavy handed regulation, monopolies will form and form quickly.
There are monopolies right now. The government for example has a monopoly on your utilities (there are economic reasons for this), there are other less obvious. Some communities have trash pick-up by the city, others are by private contractor. In those areas where trash pick-up is by the city, you are forbidden by law to seek competition even though the competition is better and cheaper. Similarly, there is the public school system which is also a monopoly. Sure, you can send your children to private school and many and more do, but you still have to pay the property tax where 75% of that is the public school tax. The tea party may have a role in breaking up some of these government monopolies, but the role remains to be seen. Is there any private corporation that you had in mind?
Your question implicitly equates capitalism and free enterprise. While capitalist systems historically have the most free enterprise, they are not one in the same thing, there are many examples of capitalist systems with little free enterprise, these cases are often right-wing authoritarian or totalitarian regimes as well. Any time you have a case of an enterprise "Too big to [be allowed to] fail." you have a situation where free enterprise is an impossibility.
governments use regulations to stomp out competition and create big business monopolies that benefit their agenda absent State coercion monopolies can exist due to offering superior products or services to consumers
I am an active member of the Tea Party movement and to answer your question yes monopolies are generally not a good idea and are an impediment to competition. We generally support a free market that allows companies to compete within a level playing field. I generally favor breaking up monopolies into smaller companies and forcing them to compete. That being said we now live in a global world market and many corporations are merely an extension of government power, such as the Chinese Military controls its own global corporations that use government force and power to achieve market share, they also conduct commercial espionage to steal ideas from competitors. The profits from their company pay to expand the reach and technical ability of the Chinese Communist Forces. The above Chinese example is how most of the rest of the world conducts its business, we therefore at times need to have companies that can compete on a global level against multinationals that would devour a small enterprise. In a perfect world with all countries democratic and a similar legal system in theory a world gov would enforce a just business law and climate, however there will be only one world government that ever achieves that goal and that is the one governed by Jesus Christ and unless I missed the news he has not as yet returned to set up his mil-lineal kingdom. The Bible indicates that there will be a world government in operation at Christs Return it will be under the control of Christs arch enemy Satan who the Bible says is the Prince of this World. The New World Order Types do not know what they are asking for anymore than the atheist socialist wish for their one world socialist utopia know what they are going to get think Hitler, Mao, and Stalin to the 100th power.