Maximum role of Government?

[AyeYo]

It doesn't work like that.  Your rule is that monopolies are always worse than competition.  It only takes one instance of that rule not being true to disprove the rule.

No, I am saying that competition is always preferable to a violent monopoly. 

Then my point still stands, because that statement is effectively no different.  You haven't proved a case for your statement.

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[AyeYo]

Where did it say anything about lower cost?

Read that post as many times as its necessary for your to understand that. Or prove it wrong, buy a bag of 10000 postcards, and put them in your car, measure your gasoline consumption (pr km or miles driven) for a few days, then do the same expirement but replace the 10000 postcards with 10000 x 50gram metalplates. You're going to tell me you wont notice an economic difference ? You're either a troll, or a complete moron.

What's your point?  That proves nothing about their costs to the customer being lower.  All you've done is stated the completely common sense fact that more weight in my car means lower gas mileage.

Where does it say prices to the customer are lower?  Maybe prices to the customer are actually higher and that's why they're still able to turn profit in spite of the weight.  

Even if they're lower, you need to examine other factors to determine the full story of why.
If it's anything like the in US, where the postal service operates the largest vehicle fleet on earth and is consitutionally mandated to deliver mail six days per week to EVERY address in the country, then it's not too surprising why the operating costs of the government mail system are higher, thus yielding higher customer costs or lower profits.  Government mails goes to EVERY house in the nation, private delivery services only go to a select number of addresses that actually have deliveries.  Make them deliver shit to every house in the nation and see how fast their operating costs increase along with their postage rates.


But that's all irrelevant so far because you have yet to show me that the private mail service has lower prices.

[Grant]

What's your point?  That proves nothing about their costs to the customer being lower.  All you've done is stated the completely common sense fact that more weight in my car means lower gas mileage.

Where does it say prices to the customer are lower?  Maybe prices to the customer are actually higher and that's why they're still able to turn profit in spite of the weight.  

What my point was ? You were trying to say that the extra 50gram per mail were IRRELEVANT. Now after i spelled it literally for you, you agree it's common sense.

If you are not a troll, read some stuff on economics, and use some imagination. I don't have time to give you basic economic lessons, what you are asking for here is ridiculous, what matters is their cost of doing business (and you now agree that cost is lower), if that cost is lower than their competitors and they make great profit it will automatically attract competition. You see there is a direct relationship between profitability and amount of competitors. You know the supply/demand rules ? More competitors means more supply, and you know what more supply means ? (look at the BTC chart since it reached 30$ till now, that's more supply growth than demand-growth).

[NghtRppr]

One last time, looking at the price on the shelf is absolutely pointless for comparing costs. If the government forces you to pay a $20,000 car tax and then you go buy a subsidized car for $0.01 then guess what, the cost of the car isn't $0.01. Simply focusing on the sale price is misleading and pointless.

That being said, focusing on just the cost is also misleading. If I pay $5,000 for a car that gets 1 mile per gallon, has no air conditioner and takes a month to get fixed if it breaks it sure is cheaper than a $10,000 car that gets 30 miles per gallon, has air conditioner and gets serviced within a day or two but who the hell would care? The $5,000 car is a piece of shit.

The moral is, you have to compare true costs and you have to take quality into account as well. The fact that the government can give us a sale price of $0.01 for piece of shit car isn't a "deal" and it sure as hell doesn't justify robbing people at gunpoint (taxes). I don't know what would, if anything, but I know it isn't marginally better products, if that can even been shown, which hasn't happened yet even once in this entire thread.

[AyeYo]

What's your point?  That proves nothing about their costs to the customer being lower.  All you've done is stated the completely common sense fact that more weight in my car means lower gas mileage.

Where does it say prices to the customer are lower?  Maybe prices to the customer are actually higher and that's why they're still able to turn profit in spite of the weight.  

What my point was ? You were trying to say that the extra 50gram per mail were IRRELEVANT. Now after i spelled it literally for you, you agree it's common sense.

You have the reading comprehension of a pre-schooler.  I said never it was IRRELEVANT.  I said it was A TRIVIAL COST COMPARED TO THE MARKET DOLLARS THEY NOW HAVE ACCESS TO.

I NEVER agreed that their costs were lower, in fact, here's what I've said:

Where did it say anything about lower cost?  It said the companies still turn a profit, but it said nothing about lower cost to the consumer.

That proves nothing about their costs to the customer being lower.  All you've done is stated the completely common sense fact that more weight in my car means lower gas mileage.

The rest of your post makes no sense because you say that only lowers costs matter (which is obviously wrong in and of itself), then you write off all the questions I had for you about proving their lower costs as irrelevant.

But that's all irrelevant so far because you have yet to show me that the private mail service has lower prices.

[Grant]

I NEVER agreed that their costs were lower, in fact, here's what I've said:

Ok, then go back to my challenge to you, 10000 postcards vs 10000 x 50gram metal plates in your car. You now disagree withyourself, earlier you said its common sense that the 10000 postcards would use less gasoline and now you claim that driving around with postcards would not guarantee it will lower your gas consumption compared to driving around with 10000 x 50gram metalplates.

Ok you're not an idiot, you're a troll. And therefore my discussion with you is over, because this just insults my intelligence.

[AyeYo]

I NEVER agreed that their costs were lower, in fact, here's what I've said:

Ok, then go back to my challenge to you, 10000 postcards vs 10000 x 50gram metal plates in your car. You now disagree withyourself, earlier you said its common sense that the 10000 postcards would use less gasoline and now you claim that driving around with postcards would not guarantee it will lower your gas consumption compared to driving around with 10000 x 50gram metalplates.

Think hard and you'll realize that all this demonstrates is that my car gets worse gas mileage with more weight in it.  Explain how this shows that their costs are lower.  Do you think gas consumption is the only cost they have?  Do you think less gas consumption automatically means lower costs?  Do you think they can't make up for HIGHER costs by simply charging higher prices and thus still turn a profit, completely destroying your logic?

[Grant]

Think hard and you'll realize that all this demonstrates is that my car gets worse gas mileage with more weight in it.  Explain how this shows that their costs are lower.  Do you think gas consumption is the only cost they have?  Do you think less gas consumption automatically means lower costs?  Do you think they can't make up for HIGHER costs by simply charging higher prices and thus still turn a profit, completely destroying your logic?

Guess i should take back what i said, you are not a troll you are simply a total idiot. I have ALWAYS been talking about their COSTS not their final prices, their final prices are totally IRRELEVANT. Read about economics before engaging in debates about them.

[AyeYo]

Are you going to answer the questions I just asked?  They're highly relevant to you proving your point.

[Grant]

Are you going to answer the questions I just asked?  They're highly relevant to you proving your point.

What question ?

[FredericBastiat]

Wow, it's getting pretty heated in here.

Definitions:
Government monopoly: Control of a specific activity or business provided for the privileged few or manipulated via regulation or other barriers to entry. Force is applied to hinder competition who may want to attempt to provide an equivalent good or service.

Natural monopoly: A person or persons who control a majority (or proportionally larger) quantity of goods or services, but notwithstanding, acquired said goods or services in a non-coercive, non-forceful way. Competition in this scenario can not be prohibited, hindered or obstructed.

Questions:

1) If you wish for a government monopoly, why? What advantage does it serve?

2) If you have a natural monopoly and you don't like it, what would you do?

In all of these responses to responses, I see a confusion between the one type of monopoly and the other. Perhaps if we referred to which one we were conversing about we wouldn't get so hot-headed.

[Anonymous]

A government monopoly will continue to be supported even in a failing state while a natural monopoly will soon collapse once it ceases to benefit its supporters and a competitor has the incentive to build on its flaws.

There's never been a bad natural monopoly.

[Grant]

Wow, it's getting pretty heated in here.

Definitions:
Government monopoly: Control of a specific activity or business provided for the privileged few or manipulated via regulation or other barriers to entry. Force is applied to hinder competition who may want to attempt to provide an equivalent good or service.

Natural monopoly: A person or persons who control a majority (or proportionally larger) quantity of goods or services, but notwithstanding, acquired said goods or services in a non-coercive, non-forceful way. Competition in this scenario can not be prohibited, hindered or obstructed.

Questions:

1) If you wish for a government monopoly, why? What advantage does it serve?

2) If you have a natural monopoly and you don't like it, what would you do?

In all of these responses to responses I see a confusion between the one type of monopoly and the other. Perhaps if we referred to which one we were conversing about we wouldn't get so hot headed.

the (2) isn't sustainable, a freemarket private-monopoly (or dominant market leader) will soon start getting inefficient, and will attract unwanted competition, which sooner or later will cancel its monopoly.

[myrkul]

2) If you have a natural monopoly and you don't like it, what would you do?

Let's look at a few natural monopolies, shall we?

1. Google search: Pretty much the default search option so much so, that there's even rumors of requiring them to give Bing some sort of assistance.

Why are they the #1 search company? Because they're good. They outperform every other search engine by orders of magnitude. Bing tries, they really do. And if Google ever starts slipping, you can be sure that Bing and the rest of the pack will tear it to shreds.

2. Facebook: THE social network, so much so that the movie about it was entitled just that, 'The Social Network'.

Why are they the #1 social network? It's the nature of these things to snowball. your friend is on there, so you get on, so all your friends get on, and so forth. Yet... People hate Facebook. Mark Zuckerberg is one of the most reviled people on the internet.

Enter Google+.

Assuming they don't fuck it up, it looks like Google+ (or whatever they end up calling it) is poised to knock down the giant.

And that's the way competition works.

[AyeYo]

2) If you have a natural monopoly and you don't like it, what would you do?

Let's look at a few natural monopolies, shall we?

1. Google search: Pretty much the default search option so much so, that there's even rumors of requiring them to give Bing some sort of assistance.

Why are they the #1 search company? Because they're good. They outperform every other search engine by orders of magnitude. Bing tries, they really do. And if Google ever starts slipping, you can be sure that Bing and the rest of the pack will tear it to shreds.

2. Facebook: THE social network, so much so that the movie about it was entitled just that, 'The Social Network'.

Why are they the #1 social network? It's the nature of these things to snowball. your friend is on there, so you get on, so all your friends get on, and so forth. Yet... People hate Facebook. Mark Zuckerberg is one of the most reviled people on the internet.

Those are not monopolies. :facepalm:

[myrkul]

Those are not monopolies. :facepalm:

Natural monopoly.

Natural monopoly: A person or persons who control a majority (or proportionally larger) quantity of goods or services, but notwithstanding, acquired said goods or services in a non-coercive, non-forceful way. Competition in this scenario can not be prohibited, hindered or obstructed.

[NghtRppr]

2) If you have a natural monopoly and you don't like it, what would you do?

the (2) isn't sustainable, a freemarket private-monopoly (or dominant market leader) will soon start getting inefficient, and will attract unwanted competition, which sooner or later will cancel its monopoly.

Let's just assume that the monopoly doesn't get inefficient. The reason why a natural monopoly isn't a problem is because, if you have a monopoly, the last thing you want to do is attract competition. That's why you can't start charging absorbent prices or start being wasteful. The mere threat of competition is enough to keep a natural monopoly competitive. All we need is a free market, whether or not there are multiple sellers is irrelevant because the competitive pressures still exist.

[compro01]

Let's just assume that the monopoly doesn't get inefficient. The reason why a natural monopoly isn't a problem is because, if you have a monopoly, the last thing you want to do is attract competition. That's why you can't start charging absorbent prices or start being wasteful. The mere threat of competition is enough to keep a natural monopoly competitive. All we need is a free market, whether or not there are multiple sellers is irrelevant because the competitive pressures still exist.

or just be competitive temporarily until the competition goes away.  the monopoly is established, they can afford to run at a loss for awhile.  the new competition can't, they have capital providers they need to pay back.

then after the new competition goes out of business, jack the prices back up to where they were.  repeat as needed.

[myrkul]

or just be competitive temporarily until the competition goes away.  the monopoly is established, they can afford to run at a loss for awhile.  the new competition can't, they have capital providers they need to pay back.

then after the new competition goes out of business, jack the prices back up to where they were.  repeat as needed.

You're assuming people will only look at price. Two or three cycles of this, and as soon as the next competitor shows up, everybody switches, because they know DickCorp is just going to raise the prices again if NewGuyCorp goes out of business again, which gives them incentive to keep them going.

[NghtRppr]

they can afford to run at a loss for awhile

If you sell something at a loss, I'll just buy it from you, stockpile it and then sell it later after you run out of money. All I have to do is show investors what you're doing and I can make easy money.