NationStates Jolt Archive

Monopoly Commission
A resolution to reduce barriers to free trade and commerce.

This resolution proproses that a United Nations Monopolies and Mergers Commission (UNMMC) is ceated to oversee cross-boarder mergers between companies in the following manner:

1. Mergers would not be allowed if:

A. the result of such a merger would be to give one company overall control over any market in any one country, where overall control is defined as greater 50% of market share

B. the result of such a merger would give the newly formed company had a significant control over a world-wide market whereby signifcant control is defined as greater than 20% of market share

2. Current monopolies should be broken up to encourage greater competition, where a monopoly is defined as greater than 25% of market share

3. Where evidence price collusion (price fixing) has found the UNMMC should take action in the form of financial penalities of the companies involved

The result of this resolution will see lower goods prices and a greater standard of living for all people in all UN member states.


Any comments/criticisms welcome, please support the proposal, thank you

We are all for stronger anti-monopoly laws, but we are troubled at the capitalist assumptions of this document.

2. Current monopolies should be broken up to encourage greater competition, where a monopoly is defined as greater than 25% of market share


We would want this clause to be refined so that it explicitly did not affect government-run industry. In a nation where all industry is run by government, this clause would demand the creation of private business - something we will not allow.


3. Where evidence price collusion (price fixing) has found the UNMMC should take action in the form of financial penalities of the companies involved


We are signatories of fair-trade agreements that could be interpreted as price collusion. We reserve the right to fix prices within our own nation. Therefore we could only support this proposal if governments were, again, explicitly exempt from these rulings.

Let's go beyond prohibiting monopolies. Let's prohibit mega-mergers of unrelated corporations which want to dominate the world through their combined economic clout.

Set a size limit for overall capitalization.

The Holy Empire of Gethamane agrees with Rep. Rehochipe. This proposal would negatively impact all of Gethamane, most notably the citizens, if government exemptions aren't inserted. Other than that, it won't affect us.

On behalf of the people of Ecopoeia, I wish to add my support to the comments made by our friends in Rehochipe, Collaboration and Gethamane. With some careful tweaking, this could be a very fine proposal.

Kind regards
Vlad Taneev
Speaker for the Economy

Thank you for your comments, I will re-submit the proposal next week with the improvements you have all suggested.

Any other comments are still welcome

Fundamentally, this is simply impractical. There is no difference at all between a corporation and a government except stated goals.

The natural progression of capitalism is to transform into Communism. If not by the expedient of the people grabbing hold of their own destiny and forcing the government to absorb all the corporations - then by corporations seizing control of all aspects of government.

Services are going to have to be provided by groups of people. These groups will have to be assigned to tasks by managers, and the managers in turn will have to get their goals from analysts and so on all the way up the chain to the top. The top can be a profit making board of directors or a voter-elected governing council - but it's still going to be there.

Ultimately, putting the clamps on monopoly is simply restraining Capitalism to keep it from devouring itself into communism. We don't see how that is even desirable.

Once you have only one corporation, it will be the government. And at that point, however corrupt it is, at least you'll have a government again. Hopefully, such a government would then proceed to have more normal governmental goals such as keeping people fed - as they would already have all of the money.

Good night, everyone.

Fundamentally, this is simply impractical. There is no difference at all between a corporation and a government except stated goals.

The natural progression of capitalism is to transform into Communism. If not by the expedient of the people grabbing hold of their own destiny and forcing the government to absorb all the corporations - then by corporations seizing control of all aspects of government.

Services are going to have to be provided by groups of people. These groups will have to be assigned to tasks by managers, and the managers in turn will have to get their goals from analysts and so on all the way up the chain to the top. The top can be a profit making board of directors or a voter-elected governing council - but it's still going to be there.

Ultimately, putting the clamps on monopoly is simply restraining Capitalism to keep it from devouring itself into communism. We don't see how that is even desirable.

Once you have only one corporation, it will be the government. And at that point, however corrupt it is, at least you'll have a government again. Hopefully, such a government would then proceed to have more normal governmental goals such as keeping people fed - as they would already have all of the money.

Good night, everyone.

:shock: Since I am new to this, you will have to exercise patience with me, please!

I do not agree with monpolies. However..........

It is my understanding that if a company, corporate entity or even a government run entity has even 50% of the market in any field of business or trade, that means that there are others making up the rest of the precentage. Wouldn't that consitute competition and therefore cannot be described as a monopoly?

If there was a situation where a new market in a new industry was created and the creator was the sole provider for these goods, then there should be a committee/commission to regulate this provider from preventing competitors to form.

There should also be regulations to control these corporations/entities from purchasing all of their competitors to become a monopoly.

The UN should also regulate governments from becoming monopolies in any field of business.

I do not know too much about this subject, but I am attempting at semi-educated guess. :?

-Wing-Ding

Who then, Wing-Ding, would you suggest compete with the Holy Empire of Gethamane for any good or service within my borders? We have no companies, and even if we did, that would necessitate public currency, which we have none of. Hence, we would be a "monopoly," based on this proposal and would be required to fracture our government... which only causes further problems, as we're a Church Heirarchy, but I digress.
While we don't necessarily agree with Kappastan's logic, their conclusion brings us to Gethamane's current position: We, the government, are the only providers of good or service, and every citizen is part of our heirarchy by either providing or producing a good and/or service. As our citizens have no money, they rely on us to provide them with whatever it is they need.

However, it appears that Leg-ends understands our concern, and we greatly appreciate their flexibility.
One last bit of advice to Leg-ends: Give the Forum a draft of the proposal before you submit it so other nations can voice their opinion.

If you wish to truly lift the barriers of free trade and commerce then put an end to unneccesary government intervention. No monopoly has ever been created by a totally free and unregulated market. All monopolies were created by the government intervention, through special privileges and other forms of "corporate welfare," which only makes it more difficult for smaller businesses to freely compete in the market.

Otherwise, corporate welfare will still exist and whoever gets too successful (regardless of how they aquired that success) will be struck down by the same entity (the government) who gave it privileges in the first place (the gov. will be fighting a War against itself). Besides, breaking down successful businesses will only destroy jobs rather than create them.

I would vote against this resolution, but it seems that because of some other socialist resolution is on the verge of being passed, this will probably be my last day in the UN.

By reducing monopolies the economy will move towards a more perfectly competitve market with several small firms all competing against each other mainly on price.

Jobs maybe lost in the short term as the market adjusts, however output will increase in the long term as output will increase. The increase in output has to be produced somehow and this will be done by recruiting people to produce them.

Monoploies stay in power because of politicians' attending to their special interests with special privileges. Reduce the role of the State, politicians loose their leeway into the economy, the power of corporations will be limited, and a business will be free to enter the market and fail or succeed based on consumer choice.

Dominance in one area of business is not neccesarily a bad thing. It is only bad when the government initiates force against companies, simply for being the most popular among consumers, which might discourage competition in the market.

Without big gov. intervention, businesses would be able look for ways of lowering the cost of production into a given field (which may already be dominated by a 'monopoly'), which would also allow them to sell products at lower prices (without having to pay back any capital given away), thus making them more competitive and perhaps even more desirable to consumers in the Free market than the already dominant businesses.

A Laissez Faire free market economy does not result in monopolies because a truly free market economy has not yet been tried on a global scale. Companies should be able to sell whatever they like to whom ever is willing to buy without fear of gov. use of force against them, which allows their slightly smaller competitors to crush them in competition with the use of legalized coersion. This kind of Gov. interference also limits the freedoms of the business owners and sets us on a destructive path towards Socialism.

Under this resolution, what would be the incentive for Small businesses to compete in the market knowing that if they become too successful, the Gov. will utimately destroy them and everything they've worked for and will thus become victims of the same system designed to 'protect' them.

Quote: "We have no companies, and even if we did, that would necessitate public currency, which we have none of. Hence, we would be a "monopoly," based on this proposal and would be required to fracture our government... which only causes further problems, as we're a Church Heirarchy..........."

Gethamane,

Ah! The wonders of government. I'm also a firm believer that you do not infringe upon the beliefs of a religion either. If a government is based on religious beliefs and the basic operations of the economy are governed solely by religion, there should be an exemption to the "monopoly policy". Besides, monopolies are described as a situation where one sole company has control over a market. "Monopoly" also derives from the Greek word "monopolion" meaning "to sell". Since you have no companies or currency and your government provides everything to the citizens directly, you are therefore "providing" and not "selling". You would therefore not be considered a monopoly.

Our dear host has neglected to make this point in his resolution.

I hope this helps....

-Wing-Ding

Companies should be able to sell whatever they like to whom ever is willing to buy without fear of gov. use of force against them, which allows their slightly smaller competitors to crush them in competition with the use of legalized coersion. This kind of Gov. interference also limits the freedoms of the business owners and sets us on a destructive path towards Socialism.

Whatever they like? Including child porn and artillery pieces? Be realistic: a government that truly imposes no limits on trade is an anarchy. Economic freedoms are not personal freedoms.

Oh no, a destructive path towards Socialism. How awful. Before we know it we'll have free education and healthcare for all, and what a dreadful thing that would be.

The more we consider this, however, the more we are inclined to regard this as intrusive into the economic policies of other nations.

It is our opinion that it is improper for governments to make laws regulating the lives of citizen's private enterprises, unless they pose a significant risk to the health and safety of said people. I.e.-pollution.

Creating a MMC is simply market engineering-attempting to interfere in the process of markets and trade. What makes the UN better suited to run the market than it's own natural laws? What makes a UN MMC less monopolistic than global corporations?

I'd like to point out that there will always be more businesses than the one UNMMC. It is a fundemental law of the market that profit and growth are linked to demand as much as supply. that is, unless people will purchase the company's goods, it cannot grow into a monopolist/oligarch.

When viewed like that, it is actually more democratic to let the people decide the course of business, than attempt to regulate the world economy from the chambers of the UN.

We oppose the proposed UNMMC on the grounds that it is undemocratic, ineffeficient, and impractical red tape.

President Horowitz,
Interim Gov of Beastieland

I forgot to mention socialism.

It is proven through hsitorical example that government control of the economy leads to ineffeciancy and lack of political freedom. When those who make the laws have control over the very means of life, it puts the citizen in a dangerous position.

Whilst businesses shouldnt be allowed to sell just anything (such as child porn which violates individual rights), it should be as free as possible. A UNMMC would cross that line, and start to dictate to citizens how they may trade.

President Horowitz

Monoploies stay in power because of politicians' attending to their special interests with special privileges. Reduce the role of the State, politicians loose their leeway into the economy, the power of corporations will be limited, and a business will be free to enter the market and fail or succeed based on consumer choice.

Last time I checked, monopolies stayed in power because noone was strong enough to oppose them.

For example, let's take a vertical monopoly of Oil Production. A single company owns the drilling, the transporting, the refining, and the retail selling of oil and oil products.

Now, let's say you want to break this power - so you build yourself an oil well or twenty. Now you are doing your own drilling, right? Well, the monopoly still controls the oil transport - so your oil just sits in vats because there is no way in hell that they are going to move it for you.

So you'll have to build your own transportation network. It won't be cheap, but you could certainly do that as well. Of course, I don't have any use for crude oil, and neither do most people - so even when you bring that sticky mass of tar into town noone is going to care. The monopoly still controls all of the refining, and again there is simply no way in hell that they are going to agree to refine your oil for you.

So you build your own refinery - which isn't cheap. But you can do it. And now you notice that you can't actually sell your refined oil anywhere because all the gas stations are owned by the monopoly and they won't take your gas at any price.

And you can build your own gas stations, and now you'll finally have the ability to compete, after having blown merely as much capitalization as goes into many countries. Right?

Wrong! The monopoly still has a couple of aces up their sleave, all of which can and will be played if they think for a moment that you have the power and capitalization to threaten their power in any way: Intimidation, Bribery, and Sabotage.

Intimidation: You can't make all this equipment yourself. A lot of it is going to have to come from else where, and that's going to be coming out of the same contractors which make things for the monopoly. If they contract with you, they risk losing the contract they already have with the standing corporation. The monopoly can simply suggest that they might look elsewhere for their contracts or move in house and those contractors will avoid you like the plague.

Bribery: The monopoly has been making a lot of money for a long time. They aren't having to bring in an entire vertical capitalization of an entire industry in a few months. They can simply choose to take a pay cut until you lose your shirt. And if they are smart, they will. Their war chest is ginormous, and they can undersell you for months, maybe years, waiting for you to go out of bussiness before they start making money again.

Sabotage: You are doing an incredible amount of construction in a short period of time. It would be a shame if your oil wells caught fire, wouldn't it? I mean, that could set you back months, during which you'll be bleeding money without the monopoly moving their prices a nickel.

And that's what you are going up against, unless you get some whiny socialist government to come in and make the monopoly stop. Which means the monopoly isn't going to stop, because I don't care what kinds of plans you think you have, you can't win. But why should the monopoly stop?

The monopoly is the master of its situation because it is the best at what it does. They won, and there's no special reason why they should have to give their winnings back. Their success really does justify their position as uncontested provider of whatever it is that they provide.

Whatever horrible things they had to do in order to get to their position, whatever "crimes" they committed, that's all justified by their success. This is why Alexander is Great, and why Hitler is a villain. Anything you had to do in order to win, obviously made enough people happy with it that it was the right thing to do. After all, if you made too many people upset, they'd revolt and hang you from the city gates.

In order to succeed you must have done the right thing, otherwise people would have stopped you. When a company controls everything, it is because people honestly prefer it that way to the alternative - so there is no justification in changing it.

Don't make me come over there.

The proposal would not seek to regulate the entire economy to what people buy and so on. The idea of the proposal is to move towards a perfectl competitive market and prefect competition. This can be explained here in a simple manner for those who do not understand:

http://william-king.www.drexel.edu/top/prin/txt/Comp/PC2.html

As libertarian rock said, quite rightly, though with the wrong reasoning:

"A Laissez Faire free market economy does not result in monopolies"

they wrongly said:

"Under this resolution, what would be the incentive for Small businesses to compete in the market knowing that if they become too successful, the Gov. will utimately destroy them and everything they've worked for and will thus become victims of the same system designed to 'protect' them."

Small business will not turn into larger business, however they will see revenues increase, but inline with everyone elses so no-one will be able to dominate the industry - therefore the government will not have a need to destroy them.

Beastieland wrong assumes that this would control the economy, it wouldnt, it will actually free the economy by spreading the control of markets from a small number of organisations (i.e. the government or monopolies) to many hundereds of organsiations all small businesses.

I urge you to read the website I have pointed you to to further understand the concept I am aiming towards.

Ah! The wonders of government. I'm also a firm believer that you do not infringe upon the beliefs of a religion either. If a government is based on religious beliefs and the basic operations of the economy are governed solely by religion, there should be an exemption to the "monopoly policy".

Excellent articulation, Wing-Ding!
This is exactly what Gethamane is getting at.
However, defending our government by using the word-root of "monopoly" isn't stable legal ground... obviously, our preferred solution is to have a government exemption explicitly stated within the proposal.
And naturally, Gethamane doesn't have the arrogance to assume we're the only government deserving of exemption... Hence the blanket exemption for government operations.
Hypothetically, what about nations which are a Corporation? Would they have valid claim for an exemption to the Monopoly law?

Monoploies stay in power because of politicians' attending to their special interests with special privileges. Reduce the role of the State, politicians loose their leeway into the economy, the power of corporations will be limited, and a business will be free to enter the market and fail or succeed based on consumer choice.

Last time I checked, monopolies stayed in power because noone was strong enough to oppose them.

For example, let's take a vertical monopoly of Oil Production. A single company owns the drilling, the transporting, the refining, and the retail selling of oil and oil products.

Now, let's say you want to break this power - so you build yourself an oil well or twenty. Now you are doing your own drilling, right? Well, the monopoly still controls the oil transport - so your oil just sits in vats because there is no way in hell that they are going to move it for you.

So you'll have to build your own transportation network. It won't be cheap, but you could certainly do that as well. Of course, I don't have any use for crude oil, and neither do most people - so even when you bring that sticky mass of tar into town noone is going to care. The monopoly still controls all of the refining, and again there is simply no way in hell that they are going to agree to refine your oil for you.

So you build your own refinery - which isn't cheap. But you can do it. And now you notice that you can't actually sell your refined oil anywhere because all the gas stations are owned by the monopoly and they won't take your gas at any price.

And you can build your own gas stations, and now you'll finally have the ability to compete, after having blown merely as much capitalization as goes into many countries. Right?

Wrong! The monopoly still has a couple of aces up their sleave, all of which can and will be played if they think for a moment that you have the power and capitalization to threaten their power in any way: Intimidation, Bribery, and Sabotage.

Intimidation: You can't make all this equipment yourself. A lot of it is going to have to come from else where, and that's going to be coming out of the same contractors which make things for the monopoly. If they contract with you, they risk losing the contract they already have with the standing corporation. The monopoly can simply suggest that they might look elsewhere for their contracts or move in house and those contractors will avoid you like the plague.

Bribery: The monopoly has been making a lot of money for a long time. They aren't having to bring in an entire vertical capitalization of an entire industry in a few months. They can simply choose to take a pay cut until you lose your shirt. And if they are smart, they will. Their war chest is ginormous, and they can undersell you for months, maybe years, waiting for you to go out of bussiness before they start making money again.

Sabotage: You are doing an incredible amount of construction in a short period of time. It would be a shame if your oil wells caught fire, wouldn't it? I mean, that could set you back months, during which you'll be bleeding money without the monopoly moving their prices a nickel.

And that's what you are going up against, unless you get some whiny socialist government to come in and make the monopoly stop. Which means the monopoly isn't going to stop, because I don't care what kinds of plans you think you have, you can't win. But why should the monopoly stop?

The monopoly is the master of its situation because it is the best at what it does. They won, and there's no special reason why they should have to give their winnings back. Their success really does justify their position as uncontested provider of whatever it is that they provide.

Whatever horrible things they had to do in order to get to their position, whatever "crimes" they committed, that's all justified by their success. This is why Alexander is Great, and why Hitler is a villain. Anything you had to do in order to win, obviously made enough people happy with it that it was the right thing to do. After all, if you made too many people upset, they'd revolt and hang you from the city gates.

In order to succeed you must have done the right thing, otherwise people would have stopped you. When a company controls everything, it is because people honestly prefer it that way to the alternative - so there is no justification in changing it.

Don't make me come over there.

When has this happened?

No offense intended to Hooglastahn...
But I wouldn't be surprised in the least if it had happened in Hooglastahn. But it's a reasonable hypothetical situation in unregulated economic models: If a Corporate has a vertical monopoly, competition is almost impossible without a higher power intervening.

Gethamane has no position on whether or not it's "right" or "wrong" to have monopolies, however.

Companies should be able to sell whatever they like to whom ever is willing to buy without fear of gov. use of force against them, which allows their slightly smaller competitors to crush them in competition with the use of legalized coersion. This kind of Gov. interference also limits the freedoms of the business owners and sets us on a destructive path towards Socialism.

Whatever they like? Including child porn and artillery pieces? Be realistic: a government that truly imposes no limits on trade is an anarchy. Economic freedoms are not personal freedoms.

You've taken what I said a bit too literal. I was never suggesting that there should be no laws on what can and can't be sold. Of course corporations should obey the laws of the land.

Oh no, a destructive path towards Socialism. How awful. Before we know it we'll have free education and healthcare for all, and what a dreadful thing that would be.

Tell it to the Soviet Union.

Small business will not turn into larger business, however they will see revenues increase, but inline with everyone elses so no-one will be able to dominate the industry - therefore the government will not have a need to destroy them.

Will you be able to control how many people choose to buy from one company? Or stop the majority of people from choosing One particular company.

Beastieland wrong assumes that this would control the economy, it wouldnt, it will actually free the economy by spreading the control of markets from a small number of organisations (i.e. the government or monopolies) to many hundereds of organsiations all small businesses.

A free economy (or at least one freer than socialism) is what allowed the businesses to be successful in the first place. People chose them. By taking out the big company who the majority chooses, they will be left to settle for companies who couldn't even successfully compete, possibly because of less efficiency in quality of products and expose them to higher prices.

Government intervention is force. You cannot force the markets to be free nor can you force them to be equal. Coersive Collectivist philosohies are always dangerous and the vast majority of them never last. People will want freedom and individualism. They will want to be treated as individuals rather than members of the collective.

THE FREER THE MARKETS THE FREER THE PEOPLE