Promote Competition
As I get older, I am truly fearing for the future of the United States of America. One of the key reasons is that the federal government has been derelict in its responsibilities to promote competition. In fact, in recent years, it has been doing the opposite and doing everything in its power to reduce competition.
We can remember as little as 15 years ago, that Clinton went after Microsoft because of its dominant position in the market place. Then about 30 years ago, Ronand Reagan succeeded in breaking up AT&T into what was known at the time as the Baby Bells. Whether you agree with these federal actions or not, it is clear that government should play a role in promoting competition in the market place. In fact, going back well over 100 years, Teddy Roosevelt ran and won the presidency with the singular message to Bust the Trusts. Some of the most important federal anti trust regulations still in effect today came from that era.
Competition is essential for capitalism. Competition lower prices for goods and services and gives consumers a multitude of choices for their purchasing dollar. Furthermore, competition creates jobs. The sad fact however is that the federal government is doing absolutely nothing to promote competition. In fact, the federal government is playing a role in stifling competition to the detriment of the very people they supposedly represent.
A good example is the proposed merger between Comcast and Time Warner. From a consumer perspective, there is absolutely no benefit to this merger. Both Comcast and Time Warner are considered to be among the worst in customer satisfaction. As a Time Warner customer, I am stunned on how bad their services, billing, and customer support are and their utter disregard for customer satisfaction. Of course, Time Warner has a monopoly in my area so there are no options.
The reason that Time Warner and Comcast can justify this merger is because the reduced company will enjoy economies of scale. Which is their fancy way of saying that they will start cutting heads. For every head they cut, their stock price will go up another $.01, so they have every incentive to cut as many “redundant” resources as possible. It would have been awesome if Comcast had come into my area and competed with Time Warner, but our federal government is essentially taking that outcome off the table.
Another example are the airlines. It makes me sad that American Airlines has now merged with US Airways. The reality that virtually every frequent flyer knows is that airline travel has turned from a pleasant experience into a mind numbing exercise in greed and stupidity. It was only 10 years ago before all the airlines began to merge, that meals were included in flights, blankets and pillows were available in all classes of services, no change fees, no baggage fees and on and on. When they merged, the airlines promised the government they wouldn’t raise price, so instead they reduced services. There is no good for the anyone except for the stock holders of these airlines and they don’t care since they all fly private airplanes anyhow.
This is not a Republican or Democrat thing. The trend started under George W Bush and has beome even more severe under Obama. Both the Democrat and Republican parties have become slaves to corporate interest and their mega lobbies and the concept of democracy has been temporarily suspended.
Democrat, or Republican, the real problem is a law passed under duress, the Pendleton Act. Following President Garfield’s assassination, congress hastily passed the Pendleton Act. Of course there existed excesses of nepotism, and political patronage, but when balanced against legacy federal employees, previously hired by opposing political parties, and political philosophies, the bureaucracy develops it’s own culture. When the unfortunate unionization of the federal workforce, and the politicization of the civil service commission came about, the very same politicians elected as supervisors of the government became beholden to the monetary contributions, and votes of those unions representing government workers. Much of government is now ran by statutes written by unelected bureaucrats within agencies of the government. Many of the political decisions are made under the influence of the inertia of rest that has evolved from a stagnate federal workforce. The federal workforce is an entity resistant to change, so things tend to be done “the way they always have been done”. Competition means change, and is frowned upon, or not tolerated at all. Thus there is a “shadow government” oppressing the marketplace of ideas, and products. An unelected government increasingly becomes tyrannical.