#1 Yes non-compete clauses benefit monopolies and hurt employees -- very rich employees, the super-stars. Don't waste your time on them.
#2 There's a myth that "busting monopolies" is the answer to monopoly capitalism because ... Teddy Roosevelt! That's just wrong. After breaking up Standard Oil (actually it was Taft that did the job for …
#1 Yes non-compete clauses benefit monopolies and hurt employees -- very rich employees, the super-stars. Don't waste your time on them.
#2 There's a myth that "busting monopolies" is the answer to monopoly capitalism because ... Teddy Roosevelt! That's just wrong. After breaking up Standard Oil (actually it was Taft that did the job for him) a few years later he concluded --That didn't work; all the pieces are colluding tacitly and making just as much, maybe more.
#3 Around that time we learned from the electric industry that monopolies have a good side (wait, I'll get to how Teddy fixed the bad side). There were sometimes 4 power companies building power lines down the same street. This made a dangerous expensive mess. Now you notice, this is Never the case. We make sure to have monopoly power companies at least for delivering power.
#4 But monopolies are still a problem and fixing that was TR's big accomplishment that you don't hear about because it doesn't sound as cool as busting the big banks (which he didn't). His answer was to regulate them, and he put in place the apparatus needed to collect the info to regulate them. That's still going strong (I forget, but is it the FTC?)
#5 Maybe you like socialism. Why? Because that has the efficiency of monopoly plus complete regulation. Now I'm not advocating that. But my point is Monopolies can (not always) have huge efficiencies. So we regulate electricity, water, most road building, etc.
#6 Regulation can be done very badly, and it's tricky, but don't forget it. That's what TR was most proud of doing, Not Busting Monopolies
From Erik Peinert: You are conflating utilities with monopolies. I don't know what you are referring to that TR did to regulate monopolies. He was long out of office when the FTC Act was passed in 1914.
Dear Erik,
#1 The predecessor of the FTC, the Bureau of Corporations, Feb 14, 1903, is what I was thinking of. Check Wikipedia. TR did that and gets the credit!
#2 No I am not conflating utilities with monopolies. I have a Ph.D. in Econ from UC Berkeley, and I worked in the area of regulating and deregulating elect. utilities. They happen to be excellent examples of "network industries" which often need regulating and can easily become monopolistic. They were at the center of the debate over "natural monopolies" around 1900. And the whole debate over turning them into utilities revolved around whether we should leave them competitive or make them monopolies and regulate them. They are now private corporations with extreme monopoly power. So we regulate that away.
#3 As to TR, Check Wikipedia (at least): "For his aggressive use of the 1890 Sherman Antitrust Act, compared to his predecessors, Roosevelt was hailed as the "trust-buster". But in reality he was more of a trust Regulator."
#4 You might spend some time wondering if Google, Amazon and Facebook might have similarities to network industries. Amazon has incredible efficiencies because it can run one truck down your street and do ~80% of the package deliveries. If 5 companies were doing that it would take 5 times the gas and C02. Regulation might make more sense than busting them up for the same reason we did that with power lines.
#1 Yes non-compete clauses benefit monopolies and hurt employees -- very rich employees, the super-stars. Don't waste your time on them.
#2 There's a myth that "busting monopolies" is the answer to monopoly capitalism because ... Teddy Roosevelt! That's just wrong. After breaking up Standard Oil (actually it was Taft that did the job for him) a few years later he concluded --That didn't work; all the pieces are colluding tacitly and making just as much, maybe more.
#3 Around that time we learned from the electric industry that monopolies have a good side (wait, I'll get to how Teddy fixed the bad side). There were sometimes 4 power companies building power lines down the same street. This made a dangerous expensive mess. Now you notice, this is Never the case. We make sure to have monopoly power companies at least for delivering power.
#4 But monopolies are still a problem and fixing that was TR's big accomplishment that you don't hear about because it doesn't sound as cool as busting the big banks (which he didn't). His answer was to regulate them, and he put in place the apparatus needed to collect the info to regulate them. That's still going strong (I forget, but is it the FTC?)
#5 Maybe you like socialism. Why? Because that has the efficiency of monopoly plus complete regulation. Now I'm not advocating that. But my point is Monopolies can (not always) have huge efficiencies. So we regulate electricity, water, most road building, etc.
#6 Regulation can be done very badly, and it's tricky, but don't forget it. That's what TR was most proud of doing, Not Busting Monopolies
From Erik Peinert: You are conflating utilities with monopolies. I don't know what you are referring to that TR did to regulate monopolies. He was long out of office when the FTC Act was passed in 1914.
Dear Erik,
#1 The predecessor of the FTC, the Bureau of Corporations, Feb 14, 1903, is what I was thinking of. Check Wikipedia. TR did that and gets the credit!
#2 No I am not conflating utilities with monopolies. I have a Ph.D. in Econ from UC Berkeley, and I worked in the area of regulating and deregulating elect. utilities. They happen to be excellent examples of "network industries" which often need regulating and can easily become monopolistic. They were at the center of the debate over "natural monopolies" around 1900. And the whole debate over turning them into utilities revolved around whether we should leave them competitive or make them monopolies and regulate them. They are now private corporations with extreme monopoly power. So we regulate that away.
#3 As to TR, Check Wikipedia (at least): "For his aggressive use of the 1890 Sherman Antitrust Act, compared to his predecessors, Roosevelt was hailed as the "trust-buster". But in reality he was more of a trust Regulator."
#4 You might spend some time wondering if Google, Amazon and Facebook might have similarities to network industries. Amazon has incredible efficiencies because it can run one truck down your street and do ~80% of the package deliveries. If 5 companies were doing that it would take 5 times the gas and C02. Regulation might make more sense than busting them up for the same reason we did that with power lines.
.
Teddy was in many ways similar to Trump today