For good or ill none of us have a monopoly on the truth. I don't remove or censor posts or comments except for some obvious spam. I realize that it often seems during a heated debate that whoever we are disagreeing with must be being deliberately obtuse not to understand our clear and obviously correct arguments. Anyone who know me knows I feel that way. And of course it is natural if we feel we are being called names to respond in kind. But can I ask posters to try to dial back the personal rhetoric? I think things are escalating to the point that we are scaring readers more than appealing to them. The more rational side of me also argues that neither side is likely to win converts to their point of view by calling people names.

David,

It was probably inevitable that it would come to this, given the emotionally charged nature of anything having to do with monopolies (or the supposed lack of them) and innovation in a discussion of copyright, patent, etc., not to mention the definition of property rights.

A couple of suggestions: impose a few rules, as some blogs do. For example, the blog at the Mises.org site says "Post an intelligent and civil comment." That seems to work there, more or less. Another blog I saw recently (can't remember the name) had a list of six or so rules for anyone wanting to comment, one of which said that commenters could make a comment but not follow up with a rehash of the same point, and that the blog owner had the right to remove any that violated this, as well as disrespectful, etc. comments.

There are a couple of commenters here who I would bar, or at least warn (they posted about the Kinsella interview), but that's not my call. The comments to that post were way too long and to little effect, unless you count generating heat but no light an effect.

I guess I'm a bit too communistic: I prefer to appeal to people's good nature rather than try to write down rules. Certainly more civility is better than less...but some degree of incivility in a tough debate may be unavoidable, so I don't want to try to mandate civility. But let's try to keep it to a minimum and avoid escalation. I do think that there is a problem with long posts covering many topics. They are hard to respond to and lead to very difficult to follow counter responses. So I would urge everyone to try to make shorter focused posts. If debates split apart, why don't people ask us to create a new thread for that debate? Any of the blog authors can simply make a new posting, perhaps summarizing the debate and asking that additional comments go on the new thread.

By the way there were some complaints about commenting on older posts: I don't see anything wrong with picking up old threads.

David:

I know that I sometimes feel that some of the people in here are being deliberately obtuse when they do not understand my clear and obviously correct arguments. Especially when their best and only response is "You are clearly wrong," or "You are obviously wrong." Okay, but why am I clearly or obviously wrong. Give me logic, not belief. Belief is fine for religion, but I would like to think that there is logic here, if I could only find it.

Lonnie

It is to grin. Haven't you noticed many are just obtuse ? Not that you have encouraged me to think you are necessarily receptive to cordial disagreement. Then there are 'The Exciteables' who put far too high a value on Free Advice : either others and theirs.

David

Picking up older threads is done much more easily by the blogger than visitors - the courtesy of a comments notifier notwithstanding. Not keeping current is often seen as 'just dumb' in the convention of large threads, where topics seem to have a half-life of 24 hours. After that 'the action' has moved on to more current discussions.Right now that's somewhat irrelevant here.

I kept close track of the comments tracks at Washington Post's 'Political Animal' by Kevin Drum for years. Moderation in that - a commercial enterprise - was only enforced with the coming of Chinese spam. Until then it was a wild melee whose 'civilizing' influence was at first regarded with an eye cautious about losing the character of freewheeling debate : complete with insults, impersonations and other ridiculous antics.

Part of my difficulty is the use of the term "monopoly." To quote from Wikipedia (though similar phrases appear elsewhere): "Monopolies are thus characterized by a lack of economic competition for the good or service that they provide and a lack of viable substitute goods." I have yet to see many products (patent or copyright) that meet this characterization. Yes, there are some, but I submit that the number in comparison to the total number of patents and copyrights is few. What disturbs me is that there has been universal lack of response on this web site to my comments regarding the characterization of what makes a monopoly. Apparently ignorance is fairly common when it comes to this subject.

I understand you don't get the term "monopoly." The Wikipedia article is fairly useless; as a number of people have pointed out in different fields, it's of limited use at best, and often has errors. I can't think of any goods or services in the real world that are provided by monopolists, save for government-provided services (such as courts), and those that are owned by people (including business owners) who have government-granted sole rights of production, such as "intellectual property rights."

Actually, if memory serves, I did respond to your point about monopoly a while back, but you didn't get the point.

Here is a great article by Dom Armentano on various theories of monopoly, which appeared in a classic collection of essays on Austrian economics in the late 1970s. He criticizes the standard neoclassical view of monopolies, and also critically examines several Austrian views, concluding that the theory propounded by Murray Rothbard in Man, Economy, and State is the only one that is theoretically and empirically coherent. I agree with every word. My economics professors should have been sued for malpractice.

Bill:

It has been a rare moment indeed on this web site when I hear a coherent response that actually has a viewpoint backed up by some kind of logic. You managed quite well in this instance.

The article by Dom Armentano is quite comprehensive and points out the supposed "flaws" in all the theories of monopoly, except for that of Rothbard. I say the flaws are supposed because I am insufficiently knowledgeable in this area to know whether Rothbard's definition of monopoly has flaws or not. I am also curious as to why an individual with such economic expertise is such a strong believer that the government is involved in a UFO coverup and speculates that we may have known about intelligent life on other planets for more than 50 years, but that is another story.

I can see from the theoretical viewpoint that Rothbard's definition makes some sense. However, while his definition is interesting from an academic viewpoint, it does have some caveats. For example, just because a monopoly exists does not necessarily mean that the monopoly decreases or, by extension, increases value for society.

Rothbard's definition also encompasses activities that have had a measurable, positive benefit on society, which already indicates that a monopoly by Rothbard's definition is not necessarily bad. The most immediate example that comes to mind is legislating seat belts in cars. We have significant documentation of death rates prior to and after the implementation of government-mandated seat belts (a monopolistic action by the government according to Rothbard). The "monopoly" in this instance provided a measureable positive net affect on society.

So, while Rothbard has this massive definition of monopoly that is all-encompassing, his definition, while interesting in a sterile, academic way, seems to provide little value or utility that can be used in any meaningful way that I can see.

I didn't know about Rothbard and the UFO's, but how do you know that the U.S. government didn't involve itself in a UFO cover up? The CIA has drawn up contingency plans to invade most countries (gotta have something for all those malemployed jerks in Langley to do), so it's hardly a stretch to imagine this. Your tax dollars at work.

For example, just because a monopoly exists does not necessarily mean that the monopoly decreases or, by extension, increases value for society.

Since when does a monopoly enhance anyone's welfare, except for the monopolist's?

Your example of seat belt legislation is not a monopoly. What it is, as Rothbard would have pointed out, is what he called a "triangular intervention" in chap. 2 of his book Power and Market (the best book ever written on the economics of government).

There are three types of intervention. An autistic intervention is Smith stealing from Jones or assaulting him, to use two examples. An example of a binary intervention is the government taxing Jones. A triangular intervention occurs when the government compels or prohibits an exchange. The British government giving Watt a patent monopoly on a steam engine is an example. The U.S. government forcing people riding in cars to wear seat belts is another. This might be a good thing, but it would be voluntary in a free society, not compulsory. Taking your vitamins might be a good thing too (or might not be, based on stuff I read a while back, which is why I stopped taking them), but should the government force you to do so?

An example of a monopoly would be giving the sole legal right to produce seat belts to one company. I assume you understand why outlawing competition in the production of seat belts would be a bad thing.

Here is a proper response to seat belt laws:

link here

Bill:

...but how do you know that the U.S. government didn't involve itself in a UFO cover up? The CIA has drawn up contingency plans to invade most countries (gotta have something for all those malemployed jerks in Langley to do), so it's hardly a stretch to imagine this. Your tax dollars at work.

The struggle I have with a "cover up" of UFO's is, why? Under the Freedom of Information Act we have seen some pretty screwy stuff revealed that our government has done in the past. Because most of this stuff happened such a long time ago, at most people roll their eyes, a few historians clamor on for a while and most everyone else says "so what?" So, Rothbard can speculate about UFO cover ups all he wants, but even if UFO's and aliens exist, somehow I doubt that the effect will be more than transitory on our economy or our behavior.

It would not surprise me that the government would cover up alien activity, but after decades (because the allegations of cover up extended from before Project Blue Book to the present day) of these allegations, there has been no evidence of a cover up. Look at Area 51. The location was unknown for a long time. Even its existence was only alleged for years. Now it has become so well known that it is a quasi tourist destination, and the military has moved their testing elsewhere. Secrets known by more than a few people (and a cover up of UFO's would involve hundreds, if not thousands) eventually develop leaks. No substantiated leaks on this one yet.

For example, just because a monopoly exists does not necessarily mean that the monopoly decreases or, by extension, increases value for society.

Since when does a monopoly enhance anyone's welfare, except for the monopolist's?

With respect to your final comment, I take this quote from the link you provided above, noting that with respect to Rothbard that you "agree with every word."

Finally, the welfare implications concerning alleged monopoly prices would not follow even if such prices could exist. Since the inelasticity of demand for Rothbard is "purely the result of voluntary demands" of the consumers, and since the exchange (at the higher prices) is completely "voluntary" anyway, there is no way to conclude that consumers or their "welfare" have been injured. (Referencing Man, Economy and State, 1962, page 564)

Your example of seat belt legislation is not a monopoly. What it is, as Rothbard would have pointed out, is what he called a "triangular intervention" in chap. 2 of his book Power and Market (the best book ever written on the economics of government).

Actually, I am in error here. My comment should have been limited to Armentano's modification of Rothbard, where Armentano states in his final paragraph that "We conclude, therefore, that any and all state restrictions are "monopolistic..." Rothbard may well have distinguished various interventions, but Armentano apparently does not.

The U.S. government forcing people riding in cars to wear seat belts is another. This might be a good thing, but it would be voluntary in a free society, not compulsory.

I should stay on point, but seat belts are one of my favorite topics.

We assume that people will act in their best interest. We know that seatbelts save lives (through statistical analysis; however, multiple studies by a variety of non-governmental entities have come to the same conclusion over decades). Yet, some people think being forced to wear seatbelts is an abridgement of their freedom. If you are in an accident and get killed when a seatbelt would have saved your life, what of the loss felt by your family, the guilt felt by the person who accidentally hit you, and the loss of your services to your employer and potentially to society? All these things seem to dictate that a reasonable person would wear a seat belt because it is the logical and reasonable thing to do. However, we know that even with government intervention a significant minority of people still do not wear seat belts. If all people truly behaved in a manner that lead to a net positive benefit for both themselves and for society, such government intervention would never be necessary.

Taking your vitamins might be a good thing too (or might not be, based on stuff I read a while back, which is why I stopped taking them), but should the government force you to do so?

Taking vitamins is a bit different than seat belts. No, I would not want the government to mandate that I take vitamins. Yes, there was a period of time where there was a stampede away from vitamins. However, after more study, the problem appears to have been that some people were taking megadoses of some vitamins. As you know, too much of anything (including ordinary water) can harm you. The vast majority of doctors now recommend taking one multivitamin per day. If you are a male, you should take a multivitamin without aluminum or iron in it (unless you have a condition that requires such). Women may need the iron. See your doctor!

An example of a monopoly would be giving the sole legal right to produce seat belts to one company. I assume you understand why outlawing competition in the production of seat belts would be a bad thing.

I think outlawing competition in anything is "a bad thing." To place in a slightly different perspective, I think that outlawing competition ultimately leads to a net negative for consumers and society, in the long run. However, I find it interesting that Armentano's summary of Rothbard's position on monopolies fine tunes my assessment. I take from Armentano's summary the following three quotes:

Rothbard clearly prefers the second definition of monopoly i.e., a grant of privilege from the state restricting competitive production or sale.

Rothbard's criticism of the theory of "monopoly price" (as well as his criticism of the theory of "competitive price") is certainly a controversial contribution to the literature on monopoly. For here he argues that in a free market there is simply no way of conceptually distinguishing "monopoly price" from a free-market competitive price.

Rothbard argues, however, that there is no objective way to determine that such a price is a monopoly price or that such a "restriction" is antisocial. All we can know, according to Rothbard, is that all firms attempt to produce a stock of goods that maximizes their net income given their estimation of demand. They attempt to price (other things being equal) such that the range of demand above the asking price is elastic. If they discover that they can increase their monetary income by producing less or even destroying existing stock in the next selling period, then they do so.

I am not an expert in this area, part of the reason I began reading this web site, so it may well be that my understanding of Armentano's summary is incorrect. However, if I am understanding what Armentano's summary is saying, it seems that while Rothbard defines monopoly in terms of "grant of privilege," Rothbard then seems to theorize that the "grant of privilege" does not necessarily lead to a monopoly price or an antisocial outcome, which, though unimportant to anything, makes sense to me.

While I agree that seat belts save lives and that people ought to use them, I don't think the State has any business forcing people to wear them, or car manufacturers to install them. The government has a right to do one thing only: quit, as Albert Jay Nock put it.

It's been a while since I looked at the Austrian discussion of monopoly price, but flipping through Man, Economy, and State, I see Rothbard does accept the idea of monopoly price, sort of, though he hedges it with so many caveats that it's useless. The pons asinorum (one of his phrases) of monopoly is the ability to restrict output, but he says (p. 690) that restricting production can't be a test of a monopoly vs. a competitive price. After going through a tedious song and dance, he says (ibid.): "There is no way to define 'monopoly price' because there is no way of defining the 'competitive price' to which the former must refer." Yada yada yada. Oh, sorry, maybe he didn't accept the idea of monopoly price. Will the real Rothbard please stand up? This for me was always the most boring part of economics in school, and my self-study of Austrian economics out of school. It was a necessary evil on the way to getting to the good stuff. I think it's all hocus pocus and drivel.

More insight can be gleaned by knowing that monopoly can't exist on the market, and can only be gained by some government grant of privilege (e.g., intellectual monopoly) or outlawing of private competition (think of the Post Office's monopoly of first-class mail delivery). Another example is the court system. Here in our local People's Republic, the government has a monopoly on small claims court. If you sue someone there, you have to pay $15 to file the suit, which sounds like a good deal, until you consider the opportunity cost of the 90 minutes you have to wait to see da judge and the fact that it only operates one night a week. So the price is a lot more than $15, and for some people a whole lot more. I don't know what a free market price would be, but whether they are charging a "monopoly price" (whatever the price actually is) stikes me as irrelevant to the main issue. What's not at issue is the fact that it has a monopoly and that consumers of judicial services in our local People's Republic are poorer for it.

While I agree that seat belts save lives and that people ought to use them, I don't think the State has any business forcing people to wear them, or car manufacturers to install them. The government has a right to do one thing only: quit, as Albert Jay Nock put it.

Bill, I must significantly disagree with you. The "state," as you frequently refer to it, regulates driving. Driving is a privilege, and has always been defined as such. There is no "natural right" to be able to drive. If you do not wish to be regulated by the state, then do not drive. The government regulates driving in order to be able to provide reasonable safety for all drivers. Thus, speed limit signs, stop signs, etc. Imagine the chaos if there were no traffic regulations! Studies by "non-state" entities, both public and private, have consistently shown that seat belts save lives, both those of the person wearing the seat belt, and those involved in the collision with the person wearing the seat belt. You may argue this regulation until the end of time, and you will not win.

It's been a while since I looked at the Austrian discussion of monopoly price, but flipping through Man, Economy, and State, I see Rothbard does accept the idea of monopoly price, sort of, though he hedges it with so many caveats that it's useless. The pons asinorum (one of his phrases) of monopoly is the ability to restrict output, but he says (p. 690) that restricting production can't be a test of a monopoly vs. a competitive price. After going through a tedious song and dance, he says (ibid.): "There is no way to define 'monopoly price' because there is no way of defining the 'competitive price' to which the former must refer." Yada yada yada. Oh, sorry, maybe he didn't accept the idea of monopoly price. Will the real Rothbard please stand up? This for me was always the most boring part of economics in school, and my self-study of Austrian economics out of school. It was a necessary evil on the way to getting to the good stuff. I think it's all hocus pocus and drivel.

I think I see Rothbard's points. As I have noted previously, these points are highly academic and I think are easy to confuse. I enjoy the part where Rothbard says that monopoly is not necessarily a negative thing, at least when using his definitions of monopoly.

More insight can be gleaned by knowing that monopoly can't exist on the market, and can only be gained by some government grant of privilege (e.g., intellectual monopoly) or outlawing of private competition (think of the Post Office's monopoly of first-class mail delivery).

Well, here again Rothbard (and others) talked of natural monopolies. While rare, they can occur. Rothbard also seems to think that there are circumstances where "monopoly" can occur (in the strictest sense where there is limited competition), but again Rothbard seems to recognize that competition in a free market will always find a way. Thus, if there is limited competition, say a limited number of radio stations in a market, if there is a true need or void, competition will find a way (satellite radio), even in the face of government regulation.

Another example is the court system. Here in our local People's Republic, the government has a monopoly on small claims court. If you sue someone there, you have to pay $15 to file the suit, which sounds like a good deal, until you consider the opportunity cost of the 90 minutes you have to wait to see da judge and the fact that it only operates one night a week. So the price is a lot more than $15, and for some people a whole lot more. I don't know what a free market price would be, but whether they are charging a "monopoly price" (whatever the price actually is) stikes me as irrelevant to the main issue. What's not at issue is the fact that it has a monopoly and that consumers of judicial services in our local People's Republic are poorer for it.

I am unsure of how you would "fix" this "problem." The Chinese have had "People's courts" headed by people with little or no legal training. The Chinese have finally figured out that it is not working. Application of the law is capricious and inconsistent. In some cases, the law is completely flaunted. Guess what the Chinese are doing in response to problems in their relatively informal court system? You got it! Judges are being required to have a legal education (ummm, in an accredited school), and the Chinese are working to increase standards for judges (uh oh, more regulations).

What we sometimes forget is that many of the actions by the state are demanded by the People of the State because of problems that span the nation or a region. When you speak of the "State," remember that it was the People of the State that initiated the systems we have.

The State does regulate driving, just as it regulates banking, but it has no right to do either. In a libertarian world, banks would be "regulated" by the rule of law and the discipline of markets, things that exist only up to a very non-libertarian point in the current set up. Come to think of it, that's how roads and driving would be regulated. Roads would be privately owned, and drivers would not be licensed by the State, a criminal gang, but would probably be certified just as accountants are now. Like banks, they would also be subject to the rule of law. There is not one iota of doubt that such a system would be safer and with fewer automobile accidents and deaths. (Here in the People's Republic of New York, killing someone while driving intoxicated is far from the serious offense it would be in a libertarian world. A couple weeks ago, there was a report about someone who had been arrested twice in upstate NY in one day DWI. He has been arrested many times for this, but continues to drive anyway. The private owners of roads in a free society would have banned him long ago from driving on their roads. I read a while back that the liquor industry has basically paid off enough state legislators to keep the heat turned down. Rent seeking at work.) The mothers at MADD should become libertarians and press for ending government involvement in roads and driving.

Driving would not be a privilege in a free society, but neither would it be an unqualified right. Any competent person of a certain age woiuld have a right to drive in accordance with applicable libertarian laws, just as he would have a right to speak. He would not, however, have the right to either drive onto your property or barge into your bedroom at 2 AM to recite the first amendment. He would not have the right to use his car as a weapon, or to purposefully cut people off, etc. Comprende? I don't disagree with you that seat belts save lives, but that is not the issue here, and I am not arguing that they don't do so.

I don't get the China example at all. You seem to have forgotten that it's a socialist state, with all that implies for the rule of law. China is moving away from socialismo, slowly and grudgingly, as The Economist and other publications document frequently. The State was not founded by "the people." Here let me refer you to Franz Oppenheimer's book The State, and Murray N. Rothbard's essay "The Anatomy of the State". I dare you to read it. No one I know who ever read it did not become an anarchist after doing so. I became an anarchist before finishing the first paragraph. By the end I was ready to go back and sue all my history and social studies teachers for malpractice.

Lonnie:

"It has been a rare moment indeed on this web site when I hear a coherent response"

Might I recommend you schedule an appointment with your doctor to have your ears examined, then? I for one have posted such to a sizable fraction of your ... outpourings.

"If you are a male, you should take a multivitamin without aluminum or iron in it"

Good luck finding any. The only supplements for sale in my general area are single-vitamin or contain iron.

"Rothbard then seems to theorize that the "grant of privilege" does not necessarily lead to a monopoly price or an antisocial outcome"

It certainly does so often enough to be worrying, and better off avoided.

Bill:

"Roads would be privately owned"

Lovely, just what I always wanted -- a world where you can't go to the corner store without going through at least three tollbooths!

"A couple weeks ago, there was a report about someone who had been arrested twice in upstate NY in one day DWI. He has been arrested many times for this, but continues to drive anyway. The private owners of roads in a free society would have banned him long ago from driving on their roads."

Tollbooths where you don't just have to throw in a few dollars, but also take a breathalyzer before the gate will open. Tollbooths with miles-long lines of very slowly-moving traffic jam extending most of the way back to the previous tollbooth along the line.

Yep. That's the way to utopia, all right. Tollbooths. Of course, everyone will stay home and telecommute if they can, and ride a bike if they must. No more greenhouse gas problems. Not much prosperity either, including by the road owners, with their tollbooths sitting there unused. Cars get to sit around rusting while we wind the clock back a century to Victorian times as far as transportation is concerned.

Utopia -- if you happen to be Amish, perhaps, anyway.

"and drivers would not be licensed by the State, a criminal gang, but would probably be certified just as accountants are now."

Certified. Oh, yay, more guild protectionism! These days I notice the alphabet soup after lots of names in TV and movie credits, and know that all of them (except the exceedingly rare B.S., Ph.D., or similarly) means it was that much more expensive to produce than it should have been.

"There is not one iota of doubt that such a system would be safer and with fewer automobile accidents and deaths."

Well, there'd be a lot fewer if everyone reverted to walking and biking everywhere because the roads were unusably clogged with tollbooths and the resulting traffic jams.

There might be a lot more road rage deaths, stemming from said jams. And a lot more deaths resulting from lack of access to basic essential services. For starters, if you took a heart attack you'd surely die, since the paramedics won't be able to get to you very quickly on their bike, and would be stuck in traffic until Doomsday in an ambulance. Then there's the effects of the general reduction in prosperity and contraction of the economy that would result from losing cheap fast transportation for individuals and goods-shipments. Wherever and whenever prosperity declines, life expectancies tend to decline with it, particularly for the poorest quartile of the population.