And I posted it here instead of legal political because I wanted to reach more people -IE - not the same old crowd.
Antitrust: A Political Weapon
by Llewellyn H. Rockwell, Jr.
Some old-time conservatives had a soft spot for antitrust laws. Russell Kirk,
for example, generally believed in free markets, but he made an exception for
interventions that curb the activities of corporations. In this, he is joined today
by free-market economists of the Chicago School. They are critical of the way
antitrust laws have been applied, but stop short of favoring their repeal.
Yet it has never been clearer that antitrust is exactly what the libertarians and
Austrian School economists have always claimed: a political weapon that
accomplishes no social good and imposes much social harm. Exhibit A is, of
course, the absurd Microsoft case, in which the government is attacking a
wonderful company on technical issues now two years out of date.
Strip away the jargon, and it becomes clear that the government wants to
nationalize Windows, the operating system that has brought the miracles of
online commerce, research, and entertainment to the world. When the
government ran the internet, it was a dead system of transfer messages
between government offices. Microsoft has shown what private enterprise can
do: change the world for the better.
It was a revolting display to see the bureaucrats at the Justice Department
cheer Judge Jackson’s decision. Many of these people didn’t even know how
to navigate the web twelve months ago, and now they are making decisions for
millions of consumers and threatening to smash the company that
democratized information. The government, driven by power-lust and fueled
by the envy of Microsoft’s competitors, is happy to jam a crowbar into the
wheel of commerce.
Just as revealing, however, is another antitrust case that has been ignored. The
same state officials who have caused so many headaches for the tobacco
industry and the software industry are considering a frontal assault on the gun
industry. The twist is that the newest issue isn’t liability for violence inflicted
(but not prevented) by guns. States are now seeking to prove that the gun
industry itself is a cartel that needs to be broken up.
Now, a cartel is supposed to be a group of manufacturers who work in
concert to dictate prices. No such thing can exist on a free market, since there
are no state-created barriers to entry, the temptation to compete by cutting
prices is so strong, the available options are so plentiful, and the market is so
internationalized as to make any claims of market power spurious on their
face. Even Opec would not have its current level of influence if taxes and
production and distribution regulations were repealed, land use not restricted,
and free trade unhampered.
There is no such thing as an effective, dangerous cartel on the free market.
And there is no such thing as a gun cartel now. A free market in firearms
prevails in all aspects of the industry where government doesn’t outlaw it.
Visit a gun store or a Wal-Mart and you find an amazing array of styles,
prices, and manufacturers, and they are all competing with each other.
Consumers are in the driver’s seat as they weigh all the factors that go into a
firearm purchase.
How can gun manufacturers be accused of violating antitrust rules? Liberal
political elites have noticed that they are all united in opposition to increased
government regulation of their industry, exactly as they should be. Recently
this took the form of an awe-inspiring boycott of Smith & Wesson for having
struck a deal with the government over issues of trigger locks, unapproved
retail outlets, and sales of firearms at gun shows.
All over the country, dealers are dropping the gun maker from their inventory,
and consumers are boycotting stores that refuse to drop the line. Shooting
ranges have even refused to admit the company’s representatives. The boycott
has been devastating to Smith & Wesson, threatening the company’ s future
profits and tarnishing its name in the eyes of every lover of freedom.
Citing the effectiveness of the boycott, some state attorneys general are
claiming that this alone is proof of cartel-like behavior-because the industry is
nearly united in opposition to being plundered. This is the equivalent of suing
taxpayers as a cartel because they all hate new taxes. And what about the
NAACP boycotting South Carolina for its Confederate flag? Are blacks to be
called a cartel because so many share a certain political point of view?
And what about the near-universal boycott by college campuses of products
from countries alleged to tolerate child labor (that is, allow life-enhancing
jobs for children who would otherwise starve)? There is no Justice
Department antitrust suit looking into left-wing state universities as possible
violators of antitrust laws. And what about the systematic (but completely
failed) attempt to boycott Microsoft, as seen at the Boycott Microsoft website.
Why isn’t this group of conspirators hounded out of public life?
The reason is that antitrust is applied selectively to those industries and firms
deemed to be threats to the Clinton regime. As with all economic regulation,
it is passed and used by political interests to effect a certain political result.
What the uproar actually indicates is widespread opposition from gun makers
and gun buyers-the only people whose interests should be considered in this
issue-to any increase in government involvement in their industry. Gun locks
and sales at gun shows are important issues, but they symbolize the idea of
gun control generally. Gun owners are intensely aware of what the left is
really demanding: federal registration of handguns (favored by Gore) and the
eventual rounding up of anyone possessing guns for anything but
government-supervised purposes.
Now, you might make the case that S&W was only acting in its own self
interest. The company has seen what happened to cigarettes and to Microsoft,
and by making a deal with the devil, it was only trying to head off a worse fate.
However, if that was the strategy, it hasn’t worked, since several states have
already said they will go ahead and include the company in the developing
class-action liability suit.
In any case, gun makers and owners are doing liberty a favor by making sure
that S&W’s concessions do not pay off either politically or financially. They
are certainly within their rights to do so, just as the NAACP is within its rights
to avoid doing business in South Carolina, and Linux fans are free to shun
Microsoft. In a free society, people are free to buy or not to buy, to promote
or boycott a product. The boycott of S&W is a sign that freedom of
association is thriving.
And consider the bitter irony of an accusation that gun interests constitute a
cartel for going after S&W. One minute, people buying S&W firearms are
considered public enemies and guilty of spreading violence and mayhem. In a
flash, the rationale is changed, so that people who do NOT buy S&W firearms
are considered a dangerous cartel refusing to grant the company its just share
of profits in the firearms market. You are part of a militia conspiracy if you
buy or part of an evil cartel if you don’t buy.
The old conservative romantics who imagined antitrust could be used
impartially were naive. Anytime you permit the central state to attack free
enterprise and private property, you are permitting political power to be used
against political enemies. And those whom the state regards as political
enemies are a predictable bunch: those who oppose government’s desire to
take away freedom. That’s why all lovers of freedom should support any
industry attacked by antitrust.
Even if you support S&W then, you should also support the other gun makers
for standing up for the right to boycott and the right of business to manage its
own affairs without arbitrary dictates from the central state. You should
support Microsoft as it fights back against an unjust attack.
April 6, 2000
Llewellyn H. Rockwell, Jr., is president of the Ludwig von Mises Institute in
Auburn, Alabama. He also edits a daily news site, LewRockwell.com.
Back to LewRockwell.com Home Page
Antitrust: A Political Weapon
by Llewellyn H. Rockwell, Jr.
Some old-time conservatives had a soft spot for antitrust laws. Russell Kirk,
for example, generally believed in free markets, but he made an exception for
interventions that curb the activities of corporations. In this, he is joined today
by free-market economists of the Chicago School. They are critical of the way
antitrust laws have been applied, but stop short of favoring their repeal.
Yet it has never been clearer that antitrust is exactly what the libertarians and
Austrian School economists have always claimed: a political weapon that
accomplishes no social good and imposes much social harm. Exhibit A is, of
course, the absurd Microsoft case, in which the government is attacking a
wonderful company on technical issues now two years out of date.
Strip away the jargon, and it becomes clear that the government wants to
nationalize Windows, the operating system that has brought the miracles of
online commerce, research, and entertainment to the world. When the
government ran the internet, it was a dead system of transfer messages
between government offices. Microsoft has shown what private enterprise can
do: change the world for the better.
It was a revolting display to see the bureaucrats at the Justice Department
cheer Judge Jackson’s decision. Many of these people didn’t even know how
to navigate the web twelve months ago, and now they are making decisions for
millions of consumers and threatening to smash the company that
democratized information. The government, driven by power-lust and fueled
by the envy of Microsoft’s competitors, is happy to jam a crowbar into the
wheel of commerce.
Just as revealing, however, is another antitrust case that has been ignored. The
same state officials who have caused so many headaches for the tobacco
industry and the software industry are considering a frontal assault on the gun
industry. The twist is that the newest issue isn’t liability for violence inflicted
(but not prevented) by guns. States are now seeking to prove that the gun
industry itself is a cartel that needs to be broken up.
Now, a cartel is supposed to be a group of manufacturers who work in
concert to dictate prices. No such thing can exist on a free market, since there
are no state-created barriers to entry, the temptation to compete by cutting
prices is so strong, the available options are so plentiful, and the market is so
internationalized as to make any claims of market power spurious on their
face. Even Opec would not have its current level of influence if taxes and
production and distribution regulations were repealed, land use not restricted,
and free trade unhampered.
There is no such thing as an effective, dangerous cartel on the free market.
And there is no such thing as a gun cartel now. A free market in firearms
prevails in all aspects of the industry where government doesn’t outlaw it.
Visit a gun store or a Wal-Mart and you find an amazing array of styles,
prices, and manufacturers, and they are all competing with each other.
Consumers are in the driver’s seat as they weigh all the factors that go into a
firearm purchase.
How can gun manufacturers be accused of violating antitrust rules? Liberal
political elites have noticed that they are all united in opposition to increased
government regulation of their industry, exactly as they should be. Recently
this took the form of an awe-inspiring boycott of Smith & Wesson for having
struck a deal with the government over issues of trigger locks, unapproved
retail outlets, and sales of firearms at gun shows.
All over the country, dealers are dropping the gun maker from their inventory,
and consumers are boycotting stores that refuse to drop the line. Shooting
ranges have even refused to admit the company’s representatives. The boycott
has been devastating to Smith & Wesson, threatening the company’ s future
profits and tarnishing its name in the eyes of every lover of freedom.
Citing the effectiveness of the boycott, some state attorneys general are
claiming that this alone is proof of cartel-like behavior-because the industry is
nearly united in opposition to being plundered. This is the equivalent of suing
taxpayers as a cartel because they all hate new taxes. And what about the
NAACP boycotting South Carolina for its Confederate flag? Are blacks to be
called a cartel because so many share a certain political point of view?
And what about the near-universal boycott by college campuses of products
from countries alleged to tolerate child labor (that is, allow life-enhancing
jobs for children who would otherwise starve)? There is no Justice
Department antitrust suit looking into left-wing state universities as possible
violators of antitrust laws. And what about the systematic (but completely
failed) attempt to boycott Microsoft, as seen at the Boycott Microsoft website.
Why isn’t this group of conspirators hounded out of public life?
The reason is that antitrust is applied selectively to those industries and firms
deemed to be threats to the Clinton regime. As with all economic regulation,
it is passed and used by political interests to effect a certain political result.
What the uproar actually indicates is widespread opposition from gun makers
and gun buyers-the only people whose interests should be considered in this
issue-to any increase in government involvement in their industry. Gun locks
and sales at gun shows are important issues, but they symbolize the idea of
gun control generally. Gun owners are intensely aware of what the left is
really demanding: federal registration of handguns (favored by Gore) and the
eventual rounding up of anyone possessing guns for anything but
government-supervised purposes.
Now, you might make the case that S&W was only acting in its own self
interest. The company has seen what happened to cigarettes and to Microsoft,
and by making a deal with the devil, it was only trying to head off a worse fate.
However, if that was the strategy, it hasn’t worked, since several states have
already said they will go ahead and include the company in the developing
class-action liability suit.
In any case, gun makers and owners are doing liberty a favor by making sure
that S&W’s concessions do not pay off either politically or financially. They
are certainly within their rights to do so, just as the NAACP is within its rights
to avoid doing business in South Carolina, and Linux fans are free to shun
Microsoft. In a free society, people are free to buy or not to buy, to promote
or boycott a product. The boycott of S&W is a sign that freedom of
association is thriving.
And consider the bitter irony of an accusation that gun interests constitute a
cartel for going after S&W. One minute, people buying S&W firearms are
considered public enemies and guilty of spreading violence and mayhem. In a
flash, the rationale is changed, so that people who do NOT buy S&W firearms
are considered a dangerous cartel refusing to grant the company its just share
of profits in the firearms market. You are part of a militia conspiracy if you
buy or part of an evil cartel if you don’t buy.
The old conservative romantics who imagined antitrust could be used
impartially were naive. Anytime you permit the central state to attack free
enterprise and private property, you are permitting political power to be used
against political enemies. And those whom the state regards as political
enemies are a predictable bunch: those who oppose government’s desire to
take away freedom. That’s why all lovers of freedom should support any
industry attacked by antitrust.
Even if you support S&W then, you should also support the other gun makers
for standing up for the right to boycott and the right of business to manage its
own affairs without arbitrary dictates from the central state. You should
support Microsoft as it fights back against an unjust attack.
April 6, 2000
Llewellyn H. Rockwell, Jr., is president of the Ludwig von Mises Institute in
Auburn, Alabama. He also edits a daily news site, LewRockwell.com.
Back to LewRockwell.com Home Page