A Bushel of Crabs
A Bushel of Crabs
It was told to me a long time ago, that black people were like a bushel of crabs. For you see, in a bushel of crabs… when one crab tries to escape the bushel basket, other crabs…. in their own attempt to escape via the efforts of another, end up pulling the escaping crab back into the bushel. The end result… none of the crabs escape. Well recently… I learned of another saying that people in Australia use that is of a similar vein, “You have to cut down the tall poppies.” In other words, allow no one to stand out and grow tall.. that those that would rise above the rest have to be brought back down to a “common” level. What has any of the above have to do with the price of eggs in China? Well read on and I will tell you.
I brought up the WorldCom mess with a couple of people that I was taking a smoke break with and it quickly evolved into a conversation that gave me an idea of what some people have been brought up to think about “Big” companies and monopolies. It seems that the consensus is that there must always be competition in the marketplace… no matter what. It got to the point that someone actually believes it is their “right” for them to have multiple companies to get a service or product from. That their “desire”, “wishes” or “whims” can and will dictate what a company can and can’t do, regardless of their involvement in that company. That the shear fact that they may someday what to use a company’s service or product should govern what business decisions that they make, and if they choose the “wrong” one… that the government should force them to do otherwise.
These general “ideas” are not just the ideas of the “everyday” man, but way too many of our politicians and also, unfortunately, our businessmen of today. Considering that general information about the nature of monopolies and competition is far from easy to find and is never really mentioned in schools or in the news (paper or otherwise), the following rules seem to have grown like weeds in a garden that is no longer tended. Rule one, monopolies are bad for the “consumer” and that they would exist if the government didn’t put a stop to the “Big Bad Companies” with Anti-trust laws and regulations. Rule two, that for the marketplace to function in a fair manner and provide the “best” (i.e. variable) prices for “consumers” there always has to be multiple businesses providing the same or similar products or services.
Well, I hate ( not really… just the opposite) to tell you that neither of those rules are true in any sense of the word. For rule one, the simple fact that a company is a monopoly doesn’t mean anything, by itself, when it comes to the final price point of a product or service. Of the many examples to choose from ( Alco… aluminum, Standard Oil… oil, and to some degree IBM and AT&T), it has been proven that prices did not go down, that overall, the prices rose. I ,for one, remember the first phone bill my Grandmother got after the breakup of AT&T.. the price had skyrocketted and alot of the overall “piece of mind” was gone. Now to have repairs done inside the home, you had to pay a seperate fee. If you wanted a phone… buy your own, if it broke… deal with the people that made it… it was and still is a mess. (Granted, AT&T was a monopoly… matter of fact one that was forced into created by the very government that later penalized the company and its investors for being a monopoly. But it is a good example of the economy of scale that monopolies bring, as with Standard Oil.)
With Rule Two, if you take it to its true level, it would mean chaos… dozens of mediocre companies, fighting for a small piece of a pie cut too thin, satisfying noone… and disappointing all. Think about it, using ISP’s as an example, there are hundreds.. if not more companies that provide internet access via phonelines, but their are only a very few that provide service for the vast majority of internet modem users, AOL, Earthlink and NetZero coming to mind rather easily. If competition was soo important to the “consumer”, how did these companies stand out and gather such a huge following? Because they did things better than the llittle “Mom and Pop” shops… like 24Hr tech support, numbers that were local across vast spans of the US and things like being able to push their products to the public via a wide variety of commerical media. To do those things, not only did they have to have the customers.. but more importantly… they convinced alot of investors ( Venture Capitalists, Stock Offering and Private investments of large sums of money) that their business ideas were good ones and that they could make the investors good returns. Most mom and pops have neither the business talent or technical skills to pull those things off, so they never grow big enough to ride out the bad times… and many grow weak and die… stranding their customers. That is not a good thing.
Now granted that running a business is not something that can be formulated to always be a sucess, but allowing outside parties.. people or groups that have nothing invested in the business to have a deciding fact in the practices of what the company can and can’t do outside of criminal activities ( excluding the absolutely ubsurd “Anti-trust” regulations ) is flawed in the highest degree. If you think that it is okay for the government to “protect” the little guy, by hammering “Big” companies for becoming monopolies, then what do you call Oracle, the Old Netscape and Sun? They are not “little guys”.. but they ran to big Papa government for “protection” from Microsoft for being a monopoly, something that can be said of each of those companies at some point in their own histories. All I am going to say in my closing of this is the following:
Let the crabs climb as high as they might and escape if they can, and you do the same.
