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The Myth of Capitalism tells the story of how America has gone from an open, competitive marketplace to an economy where a few very powerful companies dominate key industries that affect our daily lives. Digital monopolies like Google, Facebook and Amazon act as gatekeepers to the digital world. Amazon is capturing almost all online shopping dollars. We have the illusion o The Myth of Capitalism tells the story of how America has gone from an open, competitive marketplace to an economy where a few very powerful companies dominate key industries that affect our daily lives. Digital monopolies like Google, Facebook and Amazon act as gatekeepers to the digital world. Amazon is capturing almost all online shopping dollars. We have the illusion of choice, but for most critical decisions, we have only one or two companies, when it comes to high speed Internet, health insurance, medical care, mortgage title insurance, social networks, Internet searches, or even consumer goods like toothpaste. Every day, the average American transfers a little of their pay check to monopolists and oligopolists. The solution is vigorous anti-trust enforcement to return America to a period where competition created higher economic growth, more jobs, higher wages and a level playing field for all. The Myth of Capitalism is the story of industrial concentration, but it matters to everyone, because the stakes could not be higher. It tackles the big questions of: why is the US becoming a more unequal society, why is economic growth anemic despite trillions of dollars of federal debt and money printing, why the number of start-ups has declined, and why are workers losing out.


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The Myth of Capitalism tells the story of how America has gone from an open, competitive marketplace to an economy where a few very powerful companies dominate key industries that affect our daily lives. Digital monopolies like Google, Facebook and Amazon act as gatekeepers to the digital world. Amazon is capturing almost all online shopping dollars. We have the illusion o The Myth of Capitalism tells the story of how America has gone from an open, competitive marketplace to an economy where a few very powerful companies dominate key industries that affect our daily lives. Digital monopolies like Google, Facebook and Amazon act as gatekeepers to the digital world. Amazon is capturing almost all online shopping dollars. We have the illusion of choice, but for most critical decisions, we have only one or two companies, when it comes to high speed Internet, health insurance, medical care, mortgage title insurance, social networks, Internet searches, or even consumer goods like toothpaste. Every day, the average American transfers a little of their pay check to monopolists and oligopolists. The solution is vigorous anti-trust enforcement to return America to a period where competition created higher economic growth, more jobs, higher wages and a level playing field for all. The Myth of Capitalism is the story of industrial concentration, but it matters to everyone, because the stakes could not be higher. It tackles the big questions of: why is the US becoming a more unequal society, why is economic growth anemic despite trillions of dollars of federal debt and money printing, why the number of start-ups has declined, and why are workers losing out.

30 review for The Myth of Capitalism: Monopolies and the Death of Competition

  1. 4 out of 5

    Athan Tolis

    This is a story that’s crying to be told. For three important reasons, this is not the book that tells it. First, it’s poorly written: no editor’s been within a mile of it; the authors repeat entire paragraphs verbatim! (example: second paragraph of p. 98 and first paragraph of p. 118). If that is because they’ve strung together a bunch of articles they wrote earlier, they have a duty to tell us that upfront and a duty to do some editing, so I don’t read about the airlines six times. Seriously! Se This is a story that’s crying to be told. For three important reasons, this is not the book that tells it. First, it’s poorly written: no editor’s been within a mile of it; the authors repeat entire paragraphs verbatim! (example: second paragraph of p. 98 and first paragraph of p. 118). If that is because they’ve strung together a bunch of articles they wrote earlier, they have a duty to tell us that upfront and a duty to do some editing, so I don’t read about the airlines six times. Seriously! Second, anything I know intimately that’s covered in here is sloppy. Gensler gets thrown under the bus (chart, p. 190) as an ex-Goldman guy, when he did stellar work at the CFTC. The coverage of Germany in the thirties would make Adam Tooze freak out. And some of the biggest total monopolies (chewing gum, styrofoam cups) go unmentioned. How can I trust the bits I’m learning about for the first time? Third, monopoly does not happen just like that. While I agree wholeheartedly with the authors that market power is 100% what elected Trump (even if his voters don’t realize it), and therefore that monopoly and oligopoly are the biggest enemy of our polity, the author does not seem to understand that specific laws made it possible and therefore those are the laws we need to repeal. But perhaps that’s the problem. When they’re not writing books, the authors, wait for it, advise hedge funds. Unlikely then that they’d mention, dunno, the carried interest exemption, eh? So they don’t . Their list of things to fix is almost as pathetic as their fixation with economics and economists… At least they don’t blame the Russians, that’s nice. So I’m very sad to report that this isn’t the book I was hoping it would be. In the meantime, I can re-read Barry Lynn’s “Cornered,” which at least motivates the problem much better from a political standpoint and, of course, I can re-read the absolute daddy of angry, unreadable, unedited books, the one and (thank God) only “Great Deformation,” where between paeans to Eisenhower and a scarily misguided indictment of government, David Stockman forensically lays out the tools he used when he attempted to create his own private car parts monopoly prior to the 2008 crisis. He calls is “corporate equity withdrawal” and it’s all explained between pages 404 and 576, where he sets up the threefold source of our problem, namely: 1. The tax deductibility of the cost of servicing debt 2. The lower tax rate on passive income 3. The Fed ‘s “dual mandate” having been hijacked to protect risky asset holders via low rates Credit where credit is due, the authors of “The Myth of Capitalism” do add to this, actually: the fact that three indexers essentially control the board on all listed US entities certainly must tilt the playing field toward both distributions and toward monopoly-creating mergers, and away from investment in people, R&D, plant and equipment. At least three of these four things are different now than they were forty years ago, and that’s what we need to break. By the time you’re breaking monopolies, it’s far too late. It’s as futile as the taxes Piketty proposes (and the authors correctly pan.) Meantime, I’m still waiting for a sober, non-repeating, thorough book that deals with the issues in a level-headed, methodical, analytical way and proposes real solutions, as opposed to “buy more copies of this book for your friends.” “So what’s with the three stars, then, Athan?” Big points for daring to criticize the big tech behemoths, nobody dares do that anymore!

  2. 4 out of 5

    Charles Haywood

    The death of the free market at the hands of monopoly has gotten a lot of recent attention. By far the best book about this problem is Tim Wu’s "The Curse of Bigness," which through a “neo-Brandeisian” lens focuses on how monopoly destroys the core frameworks of a free society. This book, "The Myth of Capitalism," comes to much the same conclusion from a more visceral starting place—why have wages stagnated even though the labor market is tight and corporate profits are soaring? The answer is co The death of the free market at the hands of monopoly has gotten a lot of recent attention. By far the best book about this problem is Tim Wu’s "The Curse of Bigness," which through a “neo-Brandeisian” lens focuses on how monopoly destroys the core frameworks of a free society. This book, "The Myth of Capitalism," comes to much the same conclusion from a more visceral starting place—why have wages stagnated even though the labor market is tight and corporate profits are soaring? The answer is corporate concentration, and Jonathan Tepper is, like Wu, offering concrete solutions. The problems that monopoly causes are not disputed in any relevant way by anyone but a few University of Chicago ideologues. The difficulty is that all possible solutions are opposed by the ultra-powerful, ranked in armed array. One traditional way of dealing with such concentrations of power is populism, of the Left or Right. On a good day, we get Theodore Roosevelt; on a bad day, someone less attractive. It is therefore no surprise we see populist realignments arising across the political spectrum, with both conservatives and liberals girding for battle against the neoliberal kingmakers who dominate the Republican and Democratic parties. The question is whether the populists have enough will to start, then finish, the fight. As Warren Zevon sang, “Some have the speed and the right combinations / If you can’t take the punches, it don’t mean a thing.” If the new populists, the neo-Brandeisians, do have the will, this book offers some tools. It is less cerebral than Wu’s, aimed at people who have to be told who Leon Trotsky was (“a Marxist revolutionary,” if you’re curious). Tepper’s basic point is that we no longer have the free market (what he incorrectly calls “capitalism”), because most industries no longer have relevant competition. It is not because of monopoly, which is usually very obvious, but rather the less noticeable oligopoly, where a handful of firms dominate but competition, to a casual observer, appears to exist. The inevitable result of oligopoly, as Tepper (along with what appears to be some kind of co-author, Denise Hearn) shows and nobody who lives in the real world doubts, is tacit collusion on all fronts, pricing and otherwise, to avoid competition. In an oligopoly collusion is nearly as certain as death and taxes, even if done without any formal agreement. Tepper demonstrates in several compelling ways that competition is dying. Mergers have reduced the number of firms in almost all industries, while antitrust enforcement has declined over the past four decades to nearly nothing. Since 1995, the word “competition” has declined by 75% in annual reports to shareholders of public companies. Tepper offers a variety of technical measures to demonstrate his point, and I don’t think anyone disputes this. (If anyone does, I’ve missed it.) He then lists an astonishing number of industries that are nearly totally consolidated (although someone should tell him that Purdue is the university and Perdue is the chicken company). Airlines and cable TV, obviously, but also beer, bacon (all those different brands in the store are owned by Smithfield), milk, eyeglasses, drug wholesalers, crop agriculture, and very much more. Why is collusion to avoid competition bad? Tepper believes that oligopoly is literally destroying the country, and he’s pretty much right (though a lot of other unrelated things are simultaneously destroying the country). Obviously, everyone pays higher prices. But higher prices are the least of collusion’s evils. The most evident problem for most people is that oligopolies, in Tepper’s words, killed your paycheck. Stagnant wages, the problem that sparked the writing of this book, lead to higher inequality, social tension, and societal destruction. And a big cause of stagnant wages is corporate concentration, which directly lowers wages for workers, since oligopolies act as monopsonies (buyer price-setters) in the labor market, especially in smaller labor markets. It is not an answer to say that workers should go where the jobs are. The wages are often no higher there, and people are loathe to leave their communities and people, as they should be. (This is one of the key points of J. D. Vance’s Hillbilly Elegy.) It’s not just monopsony. Tepper also focuses on a particular burr that chafes me, non-compete agreements. These have exploded, and are commonly found now even in burger-flipping jobs. They are an abomination. (None of my employees, in any position, has to sign a non-competition agreement, on principle. I don’t care if my employees compete with me. Of course, I’m so wonderful to work for that nobody would ever quit.) Non-competition agreements are an offense against God and man, and it is not a coincidence that California has, for 150 years, forbidden them and developed Silicon Valley as a result. That rule should be extended nationwide, immediately, federalism be damned. Beyond wage stagnation, lack of competition leads to lack of innovation. Again, this is a commonplace, known when the Sherman Act was passed (in 1890), but conveniently forgotten when the money flows to the right political pockets. Less competition means less investment in winning competitions. Oligopoly also means that startups can be bought out with offers they can’t refuse, not dissimilar to Pablo Escobar’s famous demand to choose “plata o plomo.” And aside from buyouts, startups suffer direct attacks made possibly by the disproportionate power of oligopolists, such as Google’s suppression of, or theft of the data of, any type of business that might compete (not just in search, but in any type of data that Google thinks it can monetize). Occasionally one hears the halfhearted response that we have monopoly or oligopoly because big companies provide what consumers want and do a better, more efficient job. Tepper, like Wu, sneers at this explanation. The reality is that most giant companies are actually less efficient; there is such a thing as diseconomies of scale. Even back in the day, when Standard Oil was forcibly dismembered, the pieces collectively were more valuable than the monopoly. Again, nobody with any sense defends oligopoly; they just dodge or ignore attacks, and laugh all the way to the bank (Jamie Dimon’s bank, or another one of the oligopolist banks). Covering all the bases, Tepper also criticizes common ownership cutting across publicly traded firms, noting that index fund investing has exacerbated the problem, since entities like Fidelity have large stakes in nearly every company, including those that are putatively competitors. He touches on the problems with CEO pay, too, which are covered in more detail in Steven Clifford’s "The CEO Pay Machine," suggesting better alignment of incentives through workers being granted shares, restrictions on stock buybacks, and lockups on manager-held shares. Government actively assists the process of oligopoly formation, and not just by failing to enforce the antitrust laws. Enforcement of those laws is corrupted by the ideology of Robert Bork and by highly compensated economists who spin fantasies of future consumer price reductions that never arrive. On those rare occasions when the government attempts to enforce the laws, the courts side with the oligopolists (as in today’s decision by the D.C. Circuit Court of Appeals, rejecting the Trump administration’s attempt to block Time Warner’s merger with AT&T, where, bizarrely, the burden of proof appears to have been put on the government). For another example, Congress forbids the sale of insurance across state lines, effectively creating oligopolies; Obamacare, largely written by insurance companies, did not change that at all. And Congress, along with administrative agencies, eagerly obeys the commands of oligopolists to increase regulation. That may seem odd, until you realize what many people miss, that big companies always favor any regulation that falls harder on smaller companies, both due to compliance costs and as barriers to entry, and moreover they often write the laws and rules specifically to favor themselves. The classic example of this is Mattel, when found importing toys contaminated with lead paint, got a law passed that required expensive third-party lead testing for all toy sellers—except for themselves, who were allowed to do it cheaply internally. Or, to take another example, what penalty did Equifax pay for massively exposing consumer data due to incompetence? None, because if you’re big enough and spread enough gold around, the regulations don’t really apply to you. Government action is even worse and has greater impact than it appears, because beyond simple inefficiency and inequality, many of these oligopolies now themselves exercise the powers of government. Tepper offers Progressive economist Robert Lee Hale’s definition of government: “There is government whenever one person or group can tell others what they must do and when those others have to obey or suffer a penalty.” By that token, certainly, all the Lords of Tech, from Google to Facebook to Amazon, are government, as are, in their own spheres, all the other consolidated industries. (And, of course, often these companies impose penalties on those who do not toe the line on their political ideologies; it is not just business penalties that are at issue.) We are not that far off the classic science fiction dystopia where corporations are the government, and can impose their will on all sectors of society. If everyone not in the pocket of oligopolists agrees that corporate concentration is a problem, why isn’t anything being done about it? Silly rabbit, it’s because all the money and power is on the side of the oligopolies. All these companies spend huge sums lobbying, and it’s been shown they get massive returns on the dollars spent. They lobby to prevent antitrust enforcement; Google was the second-biggest source of campaign contributions to Obama. They lobby to add regulations. But it’s also the revolving door, at every agency and every level of government, that means oligopolists get what they want. Google, a particular target of Tepper, is one of the biggest offenders, with hundreds of its employees shuttling back and forth into and out of the government, collecting money and power both coming and going. So far, so bad. These companies also use their power in perniciously creative ways, some of which Tepper does not mention. For example, it is well known that Amazon is the major source of income for many smaller businesses (and plenty of larger ones) that sell on its platform, and uses the data it obtains about such sales to benefit itself and eliminate the profits for those businesses, increasing its own monopoly power. I don’t sell through Amazon; I’m a contract manufacturer, and thus invisible to Amazon. But one day last year an Amazon functionary called me up. They asked us to develop a brand in our industry (in essence, food, which we put into containers) which would be sold on Amazon. We could set the prices; the proposed deal was that we’d both profit if we developed an attractive brand, since Amazon would push it and we’d make money on the sales. I figured this was a scam, since I am cynical and think Jeff Bezos should be put in a ducking chair, but set up a conference call anyway with a team of Amazonians. After buttering me up, they glibly mentioned in passing that, among other standard boilerplate in the agreements they’d send me to sign, which were of course trivial (but not negotiable), there was an unimportant standard provision: that at any point Amazon could buy this entire new brand from me, lock, stock, and barrel, for the lesser of $10,000 or fees actually paid to lawyers to register trademarks. But, they assured me, this was just so they could “help me if there were any legal challenges.” A total lie, of course. What they were, and are, doing is suckering people who, unlike me, are not former M&A lawyers, by, at no cost to Amazon, throwing up hundreds or thousands of brands; seeing which succeed; then stealing them from their creators, who eagerly sign documents without paying any attention, hoping to hit the big time. A small thing, perhaps, but indicative of a cheater’s mentality. Fifty lashes for Jeff Bezos at the whipping post in the town square! Tepper offers a long list of excellent solutions. Vastly more aggressive antitrust enforcement, using bright-line numerical rules about corporate concentration. Slowing down the revolving door. Common carriage rules for internet platforms that sell third-party services (not only Net Neutrality, presumably, but also other services, such as Amazon’s selling platform). Creating rules that reduce switching costs, such as portability of social media data. All these are good, though I’d go farther. For internet common carriers, I would include rules that forbid viewpoint discrimination. I’d break up all major tech companies, and probably break up almost all existing corporate concentrations. I’d totally forbid the revolving door. Regardless, I find nothing deficient in Tepper’s solutions. But these are all egghead solutions from eggheads, vaporware in the ether. Billions of dollars are being raked in by the powerful, and then distributed to protect their interests. The oligopolists will never accept a single one of these solutions. Tepper works as an advisor to hedge funds (it is no surprise that those particular concentrations of power, which are also extremely pernicious and often eagerly participate in creating and extending the problems identified in this book, receive a grand total of zero attacks in this book). He is lucky he does not work for a think tank or other vulnerable entity. Google, for example, brutalized Anne-Marie Slaughter’s New America Foundation in 2017 when it dared to have on staff an academic team who suggested that more antitrust enforcement against Google might be a good idea. Attacking the oligopolists is like chasing a demonic greased pig—even if you catch him, he’ll probably wriggle out of your grasp, and if he can’t, he’ll kill you. What’s the answer, other than pitchforks? (I’m all for the pitchforks.) Well, divide and conquer, probably. We should serially use Saul Alinsky’s Rule 13: “Pick the target, freeze it, personalize it, and polarize it.” This will probably have to be done at the intersection of two other unpredictable factors. First, some especially spectacular bad behavior by a target, which implies that the each sequential target will have to first identify itself. Second, action by ambitious politicians, probably of the Left but maybe of the Right, willing to use this as a signature issue. Alexandria Ocasio-Cortez may be an economic illiterate, but she’s ambitious and self-promoting enough to take on such a task, and tough enough to ignore the pressure and attacks from the oligopolists. Bernie Sanders maybe, too, but he’s so old his heart probably can’t take the punches. This is a task for the young. On the Right, I can’t think of anyone—Trump, of course, but he lacks the discipline and has shown a disinclination to actually act populist (thanks, Jared and Ivanka!) Marco Rubio and Mitt Romney aren’t going to do it. Maybe J. D. Vance, if he ever runs for office, but he strikes me as not nearly vicious or ambitious enough. But with any luck, the problems themselves will call forth the problem solvers. History shows us that for every action, a reaction—though, unfortunately, often one with unintended side effects. Within reason, though, I’d happily risk the side effects to destroy the oligopolists.

  3. 4 out of 5

    Justus

    Even though I agree with nearly all of the author's arguments, this is a terrible book and you shouldn't read it. It is poorly edited, all over the place, and includes numerous ridiculous, eye-rolling claims. It isn't entirely without merit -- the authors start with a good central claim -- but it spirals out of control and quickly turn into railing against all of the misdeeds of corporations & billionaires in the modern world. Actually, one of the book's best uses is simply as an aggregation of Even though I agree with nearly all of the author's arguments, this is a terrible book and you shouldn't read it. It is poorly edited, all over the place, and includes numerous ridiculous, eye-rolling claims. It isn't entirely without merit -- the authors start with a good central claim -- but it spirals out of control and quickly turn into railing against all of the misdeeds of corporations & billionaires in the modern world. Actually, one of the book's best uses is simply as an aggregation of all those complaints into a single volume. Another point in favor of this book is that, unlike many similar books, they authors actually include numerous detailed suggestions on how to remedy the problems. So it isn't just all about complaining. The book's initial point is a good one: it feels like something is off about modern capitalism (especially in America) and there is a mounting body of evidence that concentration of companies may be the root cause. This isn't monopoly per se -- there may still be three or four players -- but the authors make credible cases for how these oligopolies can act in quasi-monopolistic ways even without explicit cartel behaviour. I think the strongest point in the entire book is that while companies may not be national monopolies they can often be regional monopolies. For example, there may be 4 cable companies in America but each town only has 1. There may be 4 airlines in the country, but any given hub city will be dominated by a single one. Those are the obvious examples but the authors show that the pattern repeats in many industries. They also point out how these local monopolies turn into monopsonies that help drive down (or contain) local wages. If there's only one airline in your town and you're a pilot, then it is difficult to negotiate a higher wage. But in among these good points they often make ridiculous, eye-rolling claims & statements. The worst one in the book was when they mention that in 2007 & 2008 contractors at Google had yellow badges...and draw a parallel between that and the yellow Star of David that Jews during the Holocaust had to wear..... Another example: "If we were being mean, we might compare promerger economists to paid prostitutes, but that would be grossly unfair to prostitutes." Another example: "Outright censorship is not so outlandish. According to the New York Times, Mark Zuckerberg has been learning Chinese." (I think we're supposed to infer that he's turning into some kind of Manchurian Candidate for Chinese-style censorship in the US...and not just learning Chinese because his wife is Chinese & speaks it.) Another example: "During an epic bout of Solitaire or porn at the Department of Justice, the great beer mergers slipped through the attention of antitrust authorities." After enough examples like that it is hard not to feel like the authors let their passion get the better of their judgment. The book is also quite poorly edited with numerous paragraphs that seem to have missed the editor's clarifying touch, leaving a reader trying to figure out what the authors meant. One brief example: "When after the English Civil war, the monopoly on printing remained." You can figure out what they mean but I don't think that's actually valid English. In many cases the authors slide from valid points about industry concentration and just start railing against every aspect of modern capitalism that they don't like. In chapter 4 they talk about how 70% of workers are asked to sign non-compete agreements and binding arbitration agreements. I agree that both are bad but what does that have to do with industry concentration? They don't even try to make a case for a linkage between those practices and industry concentration. They often conflate monopsony with simply being a large employer. They complain that "In Ohio, Amazon is one of the state's major employers and 10% of Amazon workers are on food stamps." Again, I agree this isn't a great situation but what's the relationship between industry concentration, monopsony, and this. They also talk about occupational licensing but no one is going to try to pretend that cosmetologists's occupational licensing is due to some of industry concentration in the cosmetology industry. It's at this point that you realise the thread of the argument has spun totally out of control. The authors often make take available evidence and abuse it to make unrelated claims. For instance, Apple has 80,000 employees. Apple also claims to be responsible for the creation of 2 million jobs on the US. The authors use those two claims as evidence that -- 80,000/2,000,000 = 4% -- "That means only a fraction of their workforce are full-time employees." But that's not what Apple is talking about. They're talking about how people found companies to build apps for iPhones. And they found companies to repair Apple laptops. They may or may not be full time employees but the claim is fundamentally about something different. Likewise, they write "In Seattle, home to two of the world's richest men -- Bill Gates and Jeff Bezos -- some companies can't be bothered to pay their employees minimum wage. SkyChefs, a company that puts together airplane food trays, was fined $335,000 in 2017 for violating Washington State's [...] minimum wage laws." What on Earth do Bill Gates & Jeff Bezos have to do with SkyChefs? They're just slinging mud at the wall and hoping something sticks. Or, "By 2016, regulations have expanded to 104.6 million words. The King James Bible comes in around 783,137 words." I don't see the relevance of comparing a 2,000 year old book to all of the laws required for a modern economy of 300+ million people to run. Or, "And less than 14% of households directly own corporate stock." Why does this matter? What's wrong with holding it via a mutual fund or ETF? This multitude of faults quick adds up and becomes tiresome. It is a shame because I think a tighter focus on the death of competition -- with some of the more dubious arguments (e.g. about index funds or complaints about how only the rich own stocks) stripped out by a more ruthless (and competent) editor -- would have resulted in a good entry on a much needed subject.

  4. 5 out of 5

    Steve

    The authors wish to evoke a populist anger around some of the notable anomalies in our economy, many of which, I agree, are deeply concerning and in need of resolution. I have this vision of Howard Beale's rant in the film Network. Unfortunately, this work falls mighty victim to the reductionist fallacy, which very much discredits the effort. I believe we live in a highly complex, fluid society; to render an honest account of the hows and whys of this world would require volumes resulting in: co The authors wish to evoke a populist anger around some of the notable anomalies in our economy, many of which, I agree, are deeply concerning and in need of resolution. I have this vision of Howard Beale's rant in the film Network. Unfortunately, this work falls mighty victim to the reductionist fallacy, which very much discredits the effort. I believe we live in a highly complex, fluid society; to render an honest account of the hows and whys of this world would require volumes resulting in: confusion. A few personal observations are in order. My three largest expenditures are housing, healthcare and my children's education. None of these expenses appear significantly affected by the warped capitalist world the authors describe. I rent. My city is flush with rental properties, managed and owned by multiple, unrelated entities. My largest healthcare expense is related to therapy. Therapy is something of a cottage industry, far from monopoly or oligopolistic influences. And education? Education costs have their own issues, separate and apart from the influences mentioned in this book. In my professional career, I covered insurance companies working for one of the largest banks in America. Rather than the health insurers the authors describe, I covered life insurers, property-casualty insurers and reinsurers. Both banking and insurance, from my perspective, are hyper-competitive models. The wholesale banking business is global with dozens of competitors. Even in the US, there were something like two dozen competitors in the merger and acquisition market focusing on insurance. With respect to retail banking, the authors make no mention of the 10% deposit cap that limits business concentration. As for insurance, it's frighteningly competitive, and not just from the number of competitors. The insurance industry has a number of large mutual companies that significantly influence pricing. Mutual companies have no shareholders; their cost of capital is significantly lower than their stock company peers. Interestingly, in the investment world, Vanguard is also a mutual company. The authors seem to have a searchlight directed at the tech industry. When I was in business school in the late '80s, a friend touted Microsoft as an investment. I dismissed the idea, noting that two geeks in a basement could construct a rival operating system, undoing Microsoft's supremacy. Well, I was right and wrong. It was one guy, Linus Torvalds, who created the rival operating system, Linux, and he didn't do it in a basement. However, Microsoft reigned supreme, for reasons I don't really understand. When my sister-in-law's laptop, running Microsoft Vista, recently became too dysfunctional for her, I overwrote the operating system to a Linux distribution at a total cost of $0. I'm hopeful she will never need to return to a Microsoft product. So if Microsoft can be so easily disrupted, then the question I would like to see answered is why has this not happened? This is a sloppy work with data and arguments marshaled to support a simplistic narrative. To do justice would require a work of enormous length and complexity, from which the blood would be unlikely to boil. Off the top of my head, a more rigorous approach would be to examine comprehensively the competitive trends in each individual SIC code over the past several decades, then draw conclusions from those data; who has the time for that, though? Certainly not these two.

  5. 5 out of 5

    Robert Martin

    An incredibly important book which highlights everything that I hate about capitalism. Much like communism, capitalism has many merits in theory but the implementation is another question entirely. What I admire about capitalism as a philosophy is that it is one of the few systems that has demonstrably been able to foster cooperation between fundamentally selfish individuals. The great irony is that success in the capitalist system sows the seeds for the destruction of the very same system, as l An incredibly important book which highlights everything that I hate about capitalism. Much like communism, capitalism has many merits in theory but the implementation is another question entirely. What I admire about capitalism as a philosophy is that it is one of the few systems that has demonstrably been able to foster cooperation between fundamentally selfish individuals. The great irony is that success in the capitalist system sows the seeds for the destruction of the very same system, as large companies stifle competition in order to increase their own profits at the literal expense of the consumer. Tepper provides numerous examples of the monopolies/oligopolies that run the world – both the obvious ones, like Google search, as well as the hidden ones, like how EssilorLuxotica dominates the market for spectacles and sunglasses. Perhaps where my view differs from that of the authors is the question of who is at fault. Tepper's anger is distributed across all the members of the system, but I believe that it is the regulators, not market participants, who must bear the lion's share of the blame. A capitalist is behaving perfectly rational when they seek to become a monopolist, as are investors who choose to allocate capital to those companies with the widest competitive moat. It is the role of the government to draw the line between selfish gains and direct harm to others; their consistent failure to do so is no fault of the investors (or even the companies – though this is definitely a more controversial view). "Don't hate the player, hate the game". This book has cemented my view that the current implementation of capitalism in America (and to a lesser extent elsewhere) is broken. Corporate lobbying is a ridiculous system that provides a legal means by which companies can bribe politicians for concessions that cost the consumer. One of the most heinous examples (not in this book, but nicely covered in Michael Lewis' The Fifth Risk) is the story of AccuWeather, a service that takes weather data freely published by the US government and wraps it into a program which it sells to weather apps and news media. AccuWeather has subsequently lobbied to make it incredibly difficult for other participants to access this free source directly. Some quotes I liked: "Capitalism without competition is not capitalism." "The Left attacks the grotesque capitalism we see today, as if that were the true manifestation of the essence of capitalism" "Competition is the basis for evolution. An absence of competition means an absence of evolution, a failure to adapt to new conditions. It threatens our survival."

  6. 5 out of 5

    Mehrsa

    The diagnosis of the problem is spot on--capitalism needs anti-trust or else there is no competition. In one chapter, the authors talk about all the industries that are monopolized by one or two firms and it is stunning. The companies form cartels and fix prices and it's impossible for small companies to compete. The fix was not enough, in my view. They oppose wealth taxation of all kinds and want to rely solely on anti-trust. I think we need both to promote competition. The diagnosis of the problem is spot on--capitalism needs anti-trust or else there is no competition. In one chapter, the authors talk about all the industries that are monopolized by one or two firms and it is stunning. The companies form cartels and fix prices and it's impossible for small companies to compete. The fix was not enough, in my view. They oppose wealth taxation of all kinds and want to rely solely on anti-trust. I think we need both to promote competition.

  7. 5 out of 5

    David Dayen

    Jonathan Tepper is angry. He's tired of defending capitalism when its current iteration is indefensible. He's perturbed to see a system he's worked in and thrived in for so long go to pieces. And he saves the most scorn for those functionaries in economics and the law leading the nation down a path of ruin by destroying capitalism. This isn't exactly my perspective. But sometimes it's good to have a denunciation of capitalism from someone inside the system who believes in its benefits. In The Myt Jonathan Tepper is angry. He's tired of defending capitalism when its current iteration is indefensible. He's perturbed to see a system he's worked in and thrived in for so long go to pieces. And he saves the most scorn for those functionaries in economics and the law leading the nation down a path of ruin by destroying capitalism. This isn't exactly my perspective. But sometimes it's good to have a denunciation of capitalism from someone inside the system who believes in its benefits. In The Myth of Capitalism, Tepper and his co-author Denise Hearn detail the death of competition and rise of monopolies that have upended everything economists teach are the beneficial side effects of capitalism - growing wages, equality of opportunity, and broad-based prosperity. Monopolies cut off these channels, through sitting on innovation, bargaining down wages, and leaving everyone with fewer alternatives to their dominance. Tepper started thinking about the book when he couldn't figure out how the economy could produce high growth and stagnant wages simultaneously. With their precise rendering of our age of monopoly, he and Hearn have found the answer. There's plenty in here I've written about before, and plenty I expect to write about again. But at this moment in time, it's the best bill of particulars for why this era of corporate concentration is so dangerous and must end.

  8. 5 out of 5

    Ardon Pillay

    I suppose that having competition as one of the key defining features of capitalism makes sense; greater diversity begets more choices for consumers, and keeps prices somewhat lower. However, Tepper makes the case that we are seeing less and less competition, because of monopolies, which insidiously twist the markets to favour their own development. They cut off emerging competitors at the knees, before they even have a chance to take their first steps, and use political lobbying to get regulati I suppose that having competition as one of the key defining features of capitalism makes sense; greater diversity begets more choices for consumers, and keeps prices somewhat lower. However, Tepper makes the case that we are seeing less and less competition, because of monopolies, which insidiously twist the markets to favour their own development. They cut off emerging competitors at the knees, before they even have a chance to take their first steps, and use political lobbying to get regulations in place that benefit them and make it harder for the new entrants into the market to stay there. Tepper compares the behaviour of huge oligopolies (like the airlines) to mafia bosses, carving up territories between themselves to optimise their revenues. These oligopolies also engage in price signalling, where each company knows that if another company in the oligopoly raises its prices, they too should do the same. This sort of tacit collusion really made me frustrated with the current state of capitalism. The extent to which big companies can lobby in most countries to influence regulations that may affect their industries is honestly quite sickening, it doesn't seem very far off from bribery to me. However, it has to be admitted that what these companies are doing is somewhat reasonable; they see a chance to improve their performance and their relative odds of survival as it were, an opportunity to optimise their outcomes within the bounds of the fairly lax rules regulatory bodies have created. This is why some key reforms are really necessary to change the way the system works, like scrutinising mergers and acquisitions to make sure that the companies aren't just doing this to build their own monopolies up. The system does clearly require correction.

  9. 5 out of 5

    Caitlin Dickerboom

    What a bust! This story needs to be told and this book definitely does not tell it. I was looking to form an opinion on a very topical subject this week but the poorly organized content is made more of inflammatory, out of context, click-baitish paragraphs rather than critical thinking. We get it; everyone is sensing something is “off” and the consumer is no longer free to choose in any industry, crippling capitalism, etc. etc., but this book has a long way to go before spurring productive conver What a bust! This story needs to be told and this book definitely does not tell it. I was looking to form an opinion on a very topical subject this week but the poorly organized content is made more of inflammatory, out of context, click-baitish paragraphs rather than critical thinking. We get it; everyone is sensing something is “off” and the consumer is no longer free to choose in any industry, crippling capitalism, etc. etc., but this book has a long way to go before spurring productive conversation. A better use of platform would be to explain how antitrust pursuits have gone well in the past and have helped the economy/consumer/innovation. There are examples. 2 stars for some interesting behavioral economics, but even still, it jumped all over the place instead of going deep.

  10. 4 out of 5

    Michael Broadhurst

    I'd probably give this 4.5 stars if I could, as it was somewhat repetitive at points, but its flaws are modest at best. It's both a scathing indictment of where capitalism in America is today, while also a remarkably optimistic look at how things could be redirected. I'd probably give this 4.5 stars if I could, as it was somewhat repetitive at points, but its flaws are modest at best. It's both a scathing indictment of where capitalism in America is today, while also a remarkably optimistic look at how things could be redirected.

  11. 4 out of 5

    Tõnu Vahtra

    Monopolies are bad, oligopolies are even worse, Buffett and Thiel are bad (for supporting the death of capitalism), Picketty's Capital on 21th Century is crap and other stories... I certainly agree with many of the arguments from the author, but the view is slightly narrow/simplified and criticism is not presented in properly argumented manner. There seem to be two major themes in this book: cursing the big technology companies (primarily Google, Facebook and Amazon) and trying to explain the pr Monopolies are bad, oligopolies are even worse, Buffett and Thiel are bad (for supporting the death of capitalism), Picketty's Capital on 21th Century is crap and other stories... I certainly agree with many of the arguments from the author, but the view is slightly narrow/simplified and criticism is not presented in properly argumented manner. There seem to be two major themes in this book: cursing the big technology companies (primarily Google, Facebook and Amazon) and trying to explain the problems with US political landscape that have led to unhealthy competitive situation (the lack of it). Still there were also principles that were interesting to reflect on: for example how stricter regulatory requirements create increasingly difficult conditions for smaller companies and new entrants which pushes a sector towards oligopolies. From other end I disagree with how the author categorically condemns any form of share buyback initiatives. “This brings us to the very ugly truth about regulation: while big businesses often complain about regulation, the truth is that even though it is painful and annoying, they don't mind it and even favor it. Regulations that are burdensome enough to kill small companies but are not strong enough to kill large ones are, in fact, ideal.” “All around the world, people have an overwhelming sense that something is broken. This is leading to record levels of populism in the United States and Europe, resurgent intolerance, and a desire to upend the existing order. The left and right cannot agree on what is wrong, but they both know that something is rotten. Capitalism has been the greatest system in history to lift people out of poverty and create wealth, but the “capitalism” we see today in the United States is a far cry from competitive markets. What we have today is a grotesque, deformed version of capitalism. Economists such as Joseph Stiglitz have referred to it as “ersatz capitalism,” where the distorted representation we see is as far away from the real thing as Disney's Pirates of the Caribbean are from real pirates. If what we have is a fake version of capitalism, what does the real thing look like? What should we have? According to the dictionary, the idealized state of capitalism is “an economic system based on the private ownership of the means of production, distribution, and exchange, characterized by the freedom of capitalists to operate or manage their property for profit in competitive conditions.”

  12. 4 out of 5

    Alper

    i was gonna give 2 stars in the beginning because i thought it was still giving some correct real world examples of what is going on, but i changed my mind after just hearing all the neo-classical capitalist bs. so, the story of this book is it is giving the correct examples of what is going on in the industry but imposing wrong ideas why poor "capitalism" is abused by monopolies and all that shit (regulations, etc.) to malfunction. in short, capitalism is the perfect system but we need to make i was gonna give 2 stars in the beginning because i thought it was still giving some correct real world examples of what is going on, but i changed my mind after just hearing all the neo-classical capitalist bs. so, the story of this book is it is giving the correct examples of what is going on in the industry but imposing wrong ideas why poor "capitalism" is abused by monopolies and all that shit (regulations, etc.) to malfunction. in short, capitalism is the perfect system but we need to make everyone and 237120371293871 other factors perfect ("because the market is perfect and everything that happens to it are external factors") and it will work like in the Henry Ford way! The book is really piece of garbage especially with its funny recipes and root causes but it has got the perfect market examples. +++ (will write more how this book amused me if i have time later)

  13. 5 out of 5

    Palao

    A great book in its explanations of how capitalism is so warped from its theoretical base why that's the case, how monopolies have materialized and why. Also presents good ideas and solutions for both right and left. I especially enjoyed his defence of Unions and Workers' Rights, so unusual in a liberal author. Nevertheless, I feel like the author gets too dragged by his initial bias towards a capitalism devoid of monopolies that as he explains... Has never actually existed. I would have appreci A great book in its explanations of how capitalism is so warped from its theoretical base why that's the case, how monopolies have materialized and why. Also presents good ideas and solutions for both right and left. I especially enjoyed his defence of Unions and Workers' Rights, so unusual in a liberal author. Nevertheless, I feel like the author gets too dragged by his initial bias towards a capitalism devoid of monopolies that as he explains... Has never actually existed. I would have appreciated more openness towards the topic of capitalism itself. In any way, very recommended regardless of your political position!

  14. 5 out of 5

    Kurt Jensen

    Among the most important works of history, economics and political thought. Must-read for citizens.

  15. 4 out of 5

    Pam Boling

    The Myth of Capitalism is, hands down, the best book I read in 2018 and one of the best non-fiction books I’ve read in a long time. First of all, it is very well researched, documented, and notated, which is not always the case. I applaud the authors’ diligence especially on the notations. I honestly believe if the information in this book was common knowledge to the general populace, we might never have arrived where we are today. Even now, if everyone in this country — or even most people — had The Myth of Capitalism is, hands down, the best book I read in 2018 and one of the best non-fiction books I’ve read in a long time. First of all, it is very well researched, documented, and notated, which is not always the case. I applaud the authors’ diligence especially on the notations. I honestly believe if the information in this book was common knowledge to the general populace, we might never have arrived where we are today. Even now, if everyone in this country — or even most people — had a thorough understanding of what’s contained within these pages and took action to combat it, we could right our ship. My favorite quote comes from the last page: Every day in capitalism is an election, and you get to cast your vote with your wallet. I have said for years that we should all “vote with our wallets” if we are to start shaping our country. My reasoning was twofold: 1) as outlined in The Myth of Capitalism, corporations have become too large and concentrated, eliminating competition and blocking entry; and 2) they have also become entrenched with government. The authors spent less time with the entanglement with government than on the concentration/competition issues, but they did address it. The authors examine mergers and acquisitions (M&As) resulting in oligopolies that eliminate competition and effectively block entry to smaller, independent competitors — not just in the present day, but dating back to the late nineteenth century leading up to the eventual passage of the Sherman Act of 1890 and the Clayton Act of 1914. These measures were in response to what Congress perceived to be a concentration of power. In the early- and mid-twentieth century, the United States held that antitrust was important to both the economy and security. This was even specifically stated after World War II ended, one year after Potsdam in the U.S. report on the German economy: The German people must be taught that a democratic economy is the most favorable medium for the full development of an individual… Just as we must convince the Germans on the political side of the unsoundness of making an irrevocable grant of power to a dictator or an official authoritarian group, we must also convince them on the economic side of the unsoundness of allowing a private enterprise to acquire dictatorial power over any part of the economy. Yet, today, our government approves M&As that create oligopolies and local monopolies on a regular basis. Consumers are left with few choices in many areas, some of which are essential services like utilities. The Myth of Capitalism is a must-read, in my opinion. Read it. Review it. Share it. Gift it. Act on it.

  16. 4 out of 5

    John Knowles

    Many people have labeled communism as but a myth: an unattainable fantasy. Jonathan Tepper and Denise Hearn have, by contrast, written a new book called The Myth of Capitalism: Monopolies and the Death of Competition. It contains a series of liberal and conservative critiques of the economic system of the U.S. in particular, and the West, more generally. Tepper and Hearn chronicle the decline of competitiveness in almost every sector of the U.S. economy. Most people in the mainstream media are dr Many people have labeled communism as but a myth: an unattainable fantasy. Jonathan Tepper and Denise Hearn have, by contrast, written a new book called The Myth of Capitalism: Monopolies and the Death of Competition. It contains a series of liberal and conservative critiques of the economic system of the U.S. in particular, and the West, more generally. Tepper and Hearn chronicle the decline of competitiveness in almost every sector of the U.S. economy. Most people in the mainstream media are drooling over the record highs being recorded on the stock market, but the book notes, “Between 1996-2016, the number of stocks in the U.S. fell by roughly 50%, from more than 7,300 to fewer than 3,600, while rising 50% in other developed nations.” As Tepper and Hearn painstakingly explain by citing studies and charts, the U.S. economy has been stagnant by most truly relevant metrics since the Reaganomics of the 1980s, such as R&D spending, company longevity, competitive consumer product prices and the number of annual startups. The superficiality of the recent Wall Street gains is enabled via trickery such as stock buybacks, oligopolistic mergers & lobbyist-sponsored deregulation and tax exemptions. Such corruption used to be illegal, in pre-Reagan and Buckley v. Valeo America. Teddy and Franklin Roosevelt both cracked down on monopolies like Standard Oil and the New York Central Railroad by enforcing the Sherman and Clayton Antitrust Acts. Every president since Teddy, both Democrat, and Republican cracked down on potential monopolies until Reagan. This helped prevent a market crash akin to those of 1907 and 1929, which were the direct result of laissez-faire capitalism. Wide-scale mergers started occurring during the Reagan administration and have only picked up steam ever since. Concerning our last president, Tepper and Hearn note that “Obama talked tough on big business and Wall Street, but he raised as much money from them as possible and was arguably even more pro-merger than Bush. His DOJ approved all the airline mergers, creating an oligopoly of four airlines…He allowed Google’s major acquisitions that vertically integrated parts of the ad industry…The FTC prevented Comcast from buying Time Warner in 2015 and AT&T from acquiring T-Mobile in 2011. These were the only notable mergers Obama’s DOJ blocked.” The book lists all of the industries that have effectively become oligopolies or even monopolies: search engines, beer, beverages, glasses, weapons, banks, telecommunications, social media, cell phone manufacturing, agriculture, airlines, pharmaceuticals, credit rating, tobacco, railroads, etc. The consolidation of market share to a handful of billion-dollar companies has throttled the entry of new companies in our so-called Age of the Startup. Tepper and Hearn write how Facebook has (after buying out Instagram) been able to devastate upstart platform Snapchat by mimicking all of Snapchat’s features. Such treachery, combined with Facebook’s 2B+ user base, ensured Snapchat would end up in the financial spiral that’s it’s currently in. This is but one example of how the post-merger era has sabotaged the fresh competition. The book relays this sobering stat: “In 1995, the top 100 companies accounted for 53% of all income from publicly traded firms, but by 2015, they captured a whopping 84% of all profits.” After decades of decline, the number of new firm entries fell below the number of firm exits in 2013. This decline in the number of startup innovators inevitably ends up hurting technological innovations. ‘The Myth of Capitalism’ by Jonathan Tepper; Denise Hearn. 320 pp. Wiley The merger bonanza may be great for Wall Street, but it’s horrible for Middle America. For instance, Tepper and Hearn write, “When workers have fewer employers to choose from in their line of work, their bargaining power disappears. Corporate giants can squeeze their suppliers, but the main thing companies buy is labor, and they have been squeezing workers.” Thus, wages have struggled to keep up with inflation for decades. Benefits are cut, while stock buybacks soar. Unhappy workers in all but 3 states can be shackled to soul-sucking jobs via non-compete clauses. Furthermore, “56% of private sector non-unionized workers are forced into mandatory arbitration and of those, 23% were also denied any access to class-action lawsuits. This means that nearly a quarter of working Americans in the private sector don’t have the basic right to sue their employer.” Mergers aren’t good for consumers either, despite what the corporatist rhetoric will tell you. Tepper and Hearn give countless examples of how industries became less innovative after drinking the Oligopoly Kool-Aid. The lack of competition this environment leads to complacency and, thus, a lack of product innovation or even concern for customer service. The book also reports that “In mergers that led to 6 or fewer significant competitors, prices rose in nearly 95% of cases…On average, post-merger prices increased 4.3%.” Industries from beer to pharmaceuticals are infamous for fixing prices, due to high barriers of entry for startups and tacit (and sometimes explicit) collusion. According to the book’s data, the average specialty pharmaceutical medication cost jumped 217% from 2011-2015. Unsurprising, when you consider that, “In 2017, drug makers paid for 882 lobbyists and spent more than $171.5 million in an effort to oppose lower prescription drug prices.” Ironically, lobbyists will argue that mergers lead to lower prices and greater innovation. They make the dishonest argument that the goal of the antitrust acts was solely to help consumers. In fact, the legislation never even mentioned consumer efficiency; the bills were all about breaking up the power of the trusts. People like Teddy Roosevelt and Woodrow Wilson saw how monopolies exceeded government authority in many cases; a lack of government enforcement of industry ultimately led to the Great Depression and the resulting New Deal reformations. In the era of the Too-Big-to-Fail banks and corporations, the lessons of The Myth of Capitalism are more important than ever. They expose the façade of the post-recession “economic recovery” for what it is: stock buybacks and mergers puffing up the economy. Everyone and everything from workers, consumers, people with medical conditions, startups and the IRS suffer from the corruption of American capitalism. Tepper and Hearn frame their central thesis with liberal ideals and arguments (protecting the consumer, income inequality, maintaining government independence from corporate influence), as well as conservative (market competitiveness, cutting red tape for small business, low consumer prices). A lot is written about the thoughts of Hayek and Friedman, but also leftists like FDR and Marx. The final chapter offers some solutions to the problems of our times, but they’re pretty predictable if you’ve been reading along the whole way. Page after page of charts succinctly illustrate the points Tepper and Hearn make about trust-busting, the corrosiveness of the lobbyist class, the benefits of competitive markets, and livings standards for people on Main Street. The Myth of Capitalism is a very readable, even-handed and informative primer for anyone questioning whether or not they’re being gaslighted by the nonstop barrage of praise for the economy by the oligopolistic mainstream media.

  17. 5 out of 5

    Maroš Hodor

    Hard facts supporting a claim that market regulation is insufficient to prevent before monopolies and oligopolies. Exciting examples that will surprise you. Very clear and concises Highly recommend.

  18. 4 out of 5

    Maukan

    This books is packed with compelling data on the terrain of the U.S economy. Particularly concentrated industries who stifle competition by dividing up territories between other competitors. The book goes through detail after detail of 2 to 4 corporations having 80% market share in their industry. This has a detrimental affect on the entire company, raising prices on consumers while cutting wages, increasing income inequality and lowering investments. We're in an age where 4 companies regulate t This books is packed with compelling data on the terrain of the U.S economy. Particularly concentrated industries who stifle competition by dividing up territories between other competitors. The book goes through detail after detail of 2 to 4 corporations having 80% market share in their industry. This has a detrimental affect on the entire company, raising prices on consumers while cutting wages, increasing income inequality and lowering investments. We're in an age where 4 companies regulate their markets through app stores, social networking sites and lobbying for regulatory power of opposing would be competitors, who do not have the resources to compete. This book was paradoxical at times referencing right wing theories that have been used to create this economic ecosystem we live with today while exposing the lack of antitrust laws, now you can be against one persons view on one subject but agree with them on others. It isn't so black and white but at times they cited economists who are for the status quo and used their research to back the point they were making when it was affirming to their views like for example regulation slows growth but communicates this point in such a careless way, which made me take a step back from the book. Not to mention this book talks about economic freedom and political freedom, they often quoted Hayek and Friedman to bolster their arguments, but both supported the dictatorship in Chile, which provided neither economic or political freedom, which I found a bit puzzling. That being said this book does pack some mike tyson level punches on the current system, how concentrated industries are, from the airplane industry, the defense contractors, the beer industry, the grain industry, the banking industry, the meat industry, the ratings industry... I mean it goes on and on. This book shows how concentration and mergers of industries did not benefit consumers, in fact it did the exact opposite, it raised prices and contracted supply. Mark up costs, which were only used for luxury items not seem to be the norm in all dominated industries, the feeling of being economically squeezed is validated when you look at the charges and tolls corporations are handing out to us... and because they dominate the geography of the market by price fixing and creating oligopolies and duopolies... They get away with it because we have no other choice. The book opens up about the airline who punched a customer in the face and dragged him off the flight, the airlines stocks actually soared when all should be appalled by what happened. Their stocks soared, simply because they own their market entirely and the other 3 airline companies stay away from their turf like some organized crime family. They operate in their territories and the other behemoths stay away. This is not capitalism, this is corruption of the highest levels, since the economic crash, 5.1 trillion has been spent on stock buy backs, where did all the money go? Not to workers, not to investments, not to pensions but right back into the rich. This book is worth your time, it's an easy read, the conclusion is lacking but the assessment of the issue is persuasive. I will have to read more to find out 3 stars but I'll round it to 3.5

  19. 4 out of 5

    Jeffrey

    The rise of populists is symptomatic of the dissatisfaction that much of the world's population feels - this has led to the pushback against the current status quo of capitalism and globalisation on both the left and right. Tepper argues that actually they both arguing against a straw man - the current system lacks the competition that the right normally trumpets, while the current model the left rails against is not the model of capitalism (at least according to Tepper). Tepper pushes back again The rise of populists is symptomatic of the dissatisfaction that much of the world's population feels - this has led to the pushback against the current status quo of capitalism and globalisation on both the left and right. Tepper argues that actually they both arguing against a straw man - the current system lacks the competition that the right normally trumpets, while the current model the left rails against is not the model of capitalism (at least according to Tepper). Tepper pushes back against the Piketty argument that the excessive concentration of wealth the cause of the current malaise - rather it is symptomatic of the trend towards monopolies and oligopolies that current dominate. As he argues: "Capitalism must be in favour of equal opportunity, but not equal outcomes." (p242) But what is rotten in the current system is that the tendency towards a few players dominating industries is the removal of equal opportunity, which ultimately harms the rest of society. The lack of competition means that consumers are subject to predatory pricing, workers' wages have decoupled from productivity because the labour market is often a monopsony. Further the scale of these firms, coupled with onerous and complex legislation thwarts the emergence of competitors. This lack of competition has led to these firms able to earn outsized profits which lead to the concentration of wealth described by Piketty. Tepper's main solution is to use anti-trust legislation and actions to break up the robber barons of our days. In addition, complex regulation should be rolled back in favour of simpler principles based legislation. The "consumer welfare" criteria must be rectified to not just focus on prices (given the scale of these companies enable them to sell below cost of drive out competitors). Further horizontal shareholdings should also be limited to prevent the reduction of competition by "rivals" being owned by the same controlling entity. In many ways, Tepper correctly diagnoses the problem - our lives are often dominated by a few companies (FAANG companies, large supermarket chains, etc). But even with the implementation of his changes, given the concentration of stock ownership in the top 1% - the profits will still accrue to the same class. Yes, workers and consumers should see better outcomes - but the rate will be too slow to affect major change without some sort of redistribution. The Myth of Capitalism at times can also be a bit repetitive - the same examples are trotted out many times, with better editing the book could have been more punchy and better organised to avoid this. There are also errors in the hardcopy (for example Chart 10.10 is mislabelled) and charts are often copied from their original sources (properly attributed, but the lack of consistent formatting hints to the lack of attention to detail). But overall the point is well-argued. As Tepper highlights: "Capitalism does not exist independently of government and society." It is now up to us to remould it in a form that better suits the majority of people.

  20. 5 out of 5

    Emilio Garcia

    From time to time a book on economy reaches a certain success among the general public. The popular success usually goes hand in hand with achieving influence among the elites as an inspirational book for public policies making. It was the case of Pickety´s "The capitalism of XXI Century" , and up to certain point "The myth of capitalism". Both books are complimentary visions of how growing inequality is taken place in our societies, although the author of the later saw both books as rival views From time to time a book on economy reaches a certain success among the general public. The popular success usually goes hand in hand with achieving influence among the elites as an inspirational book for public policies making. It was the case of Pickety´s "The capitalism of XXI Century" , and up to certain point "The myth of capitalism". Both books are complimentary visions of how growing inequality is taken place in our societies, although the author of the later saw both books as rival views on the issue. The main topic of Jonathan Teper´s book is how monopolies/oligopolies kill competition and the impact of this situation on the economy, which are the decrease of innovation, low wages, high prices and the growing inequality. Across the pages of the work, the author provide evidences of this effects in the US economy that he sees as captured by oligopolies in almost all its main sectors. In particular, there´s a whole chapter dedicated to the digital sector which the writer sees as a sector where all the downsides of monopolies are more evident. The book contains also an interest historic view of anti-cartel laws and policies. In the same manner that Piketty shows in his book how inequality has been historically linked to low growth, Tepper shows its link to the lack of competition. In a whole chapter devoted to this historic view, the author presents the inception of Anti-cartel laws due to the need to limit the politic power of big companies (not only to benefit consumers) and its complicated road to its actual enforcement on the last years of the XIX century and the beginning of the the XX century. This historic stroll is completed with the golden era of anti cartel policies between the II World War and the Reagan´s Presidency, which gave way to the decay of a real fight against monopolies. According with the views of the author, the stronger the anti cartel institutions, the more effective the laws and the bigger the competition and the lower the inequality. Tepper gives also a warning on the dangers of an excess of regulations to fight monopolies. On one hand, the political power of monopolies/oligopolies allow them to capture the regulatory process and makes it plays in their favour. On the other hand, while the big companies like monopolies may fulfill any kind of regulation, the compliance with laws is more costly for small and medium companies, so the effect maybe a reinforcement of oligopolies instead of its limitation. Apart from the interesting contents of the book, its style is accessible to any reader and it provides a summary of the main ideas of each. chapter at its end. So, even if you are not fond of economy books perhaps this one may be your cup of tea.

  21. 4 out of 5

    Izalette

    This review has been hidden because it contains spoilers. To view it, click here. Ersatz capitalism We should fear oligopoly not monopoly. We know how to fight monopoly. a basic industry with few players, rational management, barriers to entry, lack of barriers to exit, and non complex rule of engagement In 1990, there’s an average of 436 IPOs per year; in 2016, there’s only 74. Average age of public companies is 18 yo; vs. 12 yo in 1996. Fallacy of composition = if you do it, you’re better off; but if everyone else does it, everyone is worse off Jevons Paradox = make somethin Ersatz capitalism We should fear oligopoly not monopoly. We know how to fight monopoly. a basic industry with few players, rational management, barriers to entry, lack of barriers to exit, and non complex rule of engagement In 1990, there’s an average of 436 IPOs per year; in 2016, there’s only 74. Average age of public companies is 18 yo; vs. 12 yo in 1996. Fallacy of composition = if you do it, you’re better off; but if everyone else does it, everyone is worse off Jevons Paradox = make something more efficient, people will use more and not less (eg steam engines burn more coal, more cars on freeways) McCarran Ferguson Act 1945 - selling insurance across state lines is illegal Herfindahl-Hirshman index Passing on cost savings to consumers is a wonderful story that has no basis in reality. New firms play a decreasing role in the economy. Older firms account for larger amount of employment. High profits due to offshores production; artificial scarcity at the hands of private monopolists. CA, MT, ND and OK have no noncompete. Noncompete limits workers mobility and diminish their ability to bargain for wage increases. The fewer options the workers have, the less freedom they have to find a company that might find a higher wage. Monopsony = one buyer Wages didn’t go up: 1. Noncompete agreement 2. Contractual employment 3. Forced arbitration 4. Occupational licensing Union membership declines, income distribution to the top increases. Google and Facebook fake metrics; amazon allows counterfeit to be sold Powerful airlines buy out slots at airports to prevent new entrants Top 10% of American household owns 84% of all stocks “It begs the question as to what the antitrust authorities are doing with their time” lol Carl Duisberg emulated the US trust to completely coordinate production, pricing and competition. Endless extension of patents and copyrights Everyone bought Piketty’s book but no one finished reading it Rise of market concentration and death of competition contribute to low growth The essential role of capitalism is not maximizing efficiency Some solutions 1. Prevent mergers that reduce competition 2. Clear rules for anti-merger 3. Reverse previous merger (how? Seem like a lot of work) 4. Punish predatory pricing in highly concentrated industry 5. Speed up antitrust trial 6. Regulations to serve society not erect barriers to entry 7. Reduce switching cost and customer lock in 8. No extension for patent or copyright 9. Encourage competition once patent expires 10. Remove patent protection for some areas 11. Disallow horizontal shareholding 12. Limit share buy back

  22. 5 out of 5

    Bruce Rennie

    While the increasing levels of income and wealth inequality have been mentioned more and more often in the press, the causes of the growing gap are often omitted. This book dives into those root causes. At the moment, the US is a largely a functioning oligopoly. Virtually every industry has seen large scale "concentration" to the point where there are generally fewer than 4 large competitors. Air travel, groceries, health care, it doesn't matter. Just about any industry you can name is controlle While the increasing levels of income and wealth inequality have been mentioned more and more often in the press, the causes of the growing gap are often omitted. This book dives into those root causes. At the moment, the US is a largely a functioning oligopoly. Virtually every industry has seen large scale "concentration" to the point where there are generally fewer than 4 large competitors. Air travel, groceries, health care, it doesn't matter. Just about any industry you can name is controlled by a few, large players. The concentration of power in these industries allows these players to further impact the market in their own favor, in a kind of feedback loop. These impacts include downward pressure on worker wages, reductions in R&D spending, collusion, barriers to entry for new competitors, and higher prices for consumers. This is not the first time the US has faced this situation. The "gilded age" of the late 19th and early 20th centuries saw the rise of the robber barons who's power, at their peak, came close to rivaling the government itself. Many of the US government institutions we know today were created to combat their power. These include the FTC, the federal reserve, etc. The US managed to contain and reduce the power of the robber barons via a combination of anti-trust legislation, the creation of government watchdogs such as the FTC, and the will to use them. A lesson had been learned: monopolies were bad, not just for consumers but for the economy and the country as a whole. This philosophy reigned in Washington for 50 years. Then, in the Reagan years, it all changed. At a stroke, Reagan neutered the anti-trust regulations and rendered the watchdogs impotent. The result was a massive wave of mergers and acquisitions that continues to this day. Washington knows how to address the problem. It's been fixed before. The will is simply lacking. The book lays out the issues with high levels of industry concentration, and the history of monopolies in a clear manner that's easy to read. There is liberal use of charts and graphs that are helpful in illustrating the topics being discussed. Overall, it's a well laid out argument. Unfortunately, the book also has a number of challenges. The main issue I had was that many points were repeated multiple times throughout the book in a way that felt more like a failure of editing than something intended by the authors. Overall, a good read. Very eye opening.

  23. 4 out of 5

    Evan

    It took me almost a month to finish this book... Which means I didn't like it until the end. I've listened to a lot of Jonathan Tepper interviews on podcasts (e.g., MacroVoices), and I think he is a really smart guy. But, with this book, I think he tries to assign to much of the cause of income inequality to monopolies. I finished the "great leveler" recently, and the premise of the book is that 1) the trend of human history is always towards greater levels of income inequality and 2) that incom It took me almost a month to finish this book... Which means I didn't like it until the end. I've listened to a lot of Jonathan Tepper interviews on podcasts (e.g., MacroVoices), and I think he is a really smart guy. But, with this book, I think he tries to assign to much of the cause of income inequality to monopolies. I finished the "great leveler" recently, and the premise of the book is that 1) the trend of human history is always towards greater levels of income inequality and 2) that income inequality has only been disrupted by things like massive plague (think Bubonic plague) or mass mobilization warfare (like WWI and WWII, not smaller cabinet wars). Also, since his book focuses on the United States, I wonder how much of the wage compression is due to globalization. I guess maybe not much, since most US manufacturing firms have gone out of business, but those workers, in general, have had to take lower paying service jobs. I wish he would have made a stronger argument for why lower consumer prices are bad. Personally, I like lower prices and the convenience of being able to buy everything I need in one stop (e.g., Walmart, Target or Home Depot). He is arguing that anti-trust should be enforced according to the 1890's standard, and not according to the impact on consumer welfare that began being considered in the 1960's. Maybe he is right, but I would like to see him make the argument more clearly. I think he is right that we, as Americans, should be upset at the industry concentration and resulting poor customer experiences that have resulted (e.g., invasion of privacy, low wages?, unnecessary fees). After hammering companies on income inequality throughout the book, in the conclusion, he admits that reducing monopolies will only have a partial effect on reducing income inequality. So he won me back over when he reduced the emphasis he was putting on monopolies to a stance that was reasonable. ;)

  24. 5 out of 5

    Susan Brunner

    This book’s full title is The Myth of Capitalism: Monopolies and the Death of Competition. This book was recommended by John Mauldin in a Thoughts from the Front Lines email. I agree we no longer have capitalism in a lot of ways. Some companies, especially tech companies come to mind, have grown too big and too powerful. They allow no competition. However, this applies to a lot of other industries in the US. These are also big international companies. Examples of products of companies with large This book’s full title is The Myth of Capitalism: Monopolies and the Death of Competition. This book was recommended by John Mauldin in a Thoughts from the Front Lines email. I agree we no longer have capitalism in a lot of ways. Some companies, especially tech companies come to mind, have grown too big and too powerful. They allow no competition. However, this applies to a lot of other industries in the US. These are also big international companies. Examples of products of companies with large concentrations are for cell phones, cereals, toothpaste, internet providers. Results of this is reduced wages for workers and inequality. As usual, Good Reads has a lot of good reviews of this book. The bad reviews criticize the editing and even though they agree with the premise they feel the book could be written better. A review by Yves Smith on Naked Capitalism that is rather critical of Tepper. And here is part of the review of this book by John Siman. James McRitchie on Corporate Governance does a review of this book. Denise Hearn and Jonathan Tepper speaks via Town Hall Seattle. The panel discussion is especially interesting. Jonathan Tepper answers questions on Real Vision. Denise Hearn and Jonathan Tepper speaks in this very short video about their book The Myth of Capitalism.

  25. 4 out of 5

    B.T. Party

    A cogent analysis of the ills of capitalism and a clear path to its reformation. 5* From the Introduction: "Capitalism without competition is not capitalism." Competition is essential to the moral success of capitalism, as was well known to the founders of the American republic as contemporaries of Adam Smith. The benefits of free market capitalism include: * creates clear price signals, efficiently balancing supply and demand * more choices, innovation, and economic growth * prevents unjust inequal A cogent analysis of the ills of capitalism and a clear path to its reformation. 5* From the Introduction: "Capitalism without competition is not capitalism." Competition is essential to the moral success of capitalism, as was well known to the founders of the American republic as contemporaries of Adam Smith. The benefits of free market capitalism include: * creates clear price signals, efficiently balancing supply and demand * more choices, innovation, and economic growth * prevents unjust inequality, dispersing economic power and strengthening democracy * promotes individual initiative and freedom The lack of competition leads to the loss of all these benefits and to a failure to adapt to changing conditions resulting in economic stagnation. Its absence threatens our survival. Both consumers and workers are on the ropes. Why? Because modern American Capitalism has tended towards the tyranny of monopoly and away from the liberty of free market competition. The authors back these tenets with a full set of research compellingly displayed in charts and easy to read text. There are 34 pages of end-notes plus a useful index. Look into the review by Dean Kagawa for a brief run down of the ten chapters. There is much absorbing history and argument in each one. I read "The Myth of Capitalism" entirely in a weekend and have been referring to it repeatedly ever since. Some of the enlightening points (for me): Near-monopolies dominate the U.S. market in 2/3 of its industries, including airlines, cable, insurance, meats, railroads, banks, beer, seed, phone OS, search, and funeral homes. These are often duopolies or oligopolies which have escaped anti-trust enforcement by the promotion of a limited definition of the public good by the Chicago school economists and by regulatory capture. (That is the revolving door between working within the industry or as lobbyists, and as government regulators.) Cartels can artificially reduce supply and fix prices without openly talking to one another through tacit collusion among perceived competitors. There is a correlation between low interest rates engineered by the Federal Reserve and cartels forming and thriving. (Chap. 2) The rules of the game have changed for the American worker -- wages have not risen with increased productivity nor with rising corporate profits. This anomaly was the question which this book was written to answer. The reason is the concentration of economic power in monopsonies, or markets where there are few buyers of the services of labor or suppliers. Highly concentrated commuting zones drive down wages as much as 15 to 25%. Rural areas are more likely to have monopsonic conditions. Workers are also chained to a job due to non-compete agreements that are a condition of employment. Furthermore, union collective bargaining has declined while occupational licensing has increased. "Chapter 5: Silicon Valley Throws Some Shade" is so broad and deep, you have to read it for yourself. It's here that platform power has obliterated competition. The wealthy own the toll roads while the rest pay to use them. The result is the inequality of income and wealth that threatens the social and political fabric of the country. The control of public stock companies is concentrated in a small percentage of the population while most have no stock ownership at all, even in the places where they work. There are now, as Ray Dalio has noted, two economies, the Top 40% and the Bottom 60%. In four pages of Chapter 10, the authors dissect the "extraordinary, puzzling success of Thomas Piketty’s "Capital in the Twenty-First Century." (While 1.5 million copies of the dense 700 page tome were bought, a study of Kindle bookmarks found that almost no one made it past page 26! ) His evidence that vast inequality was the result of a lack of growth was not replicated by other researchers. While Piketty did an excellent job of documenting the growing gap between the very rich and everyone else, and captured the feeling that something was unfair, he failed to locate the cause, which is the "rise of market concentration and the death of competition." The missing piece of the puzzle is that worker pay including benefits has stagnated in an era of booming corporate profits, share buybacks and executive compensation -- because of (drum-roll) -- the dearth of anti-trust enforcement since the early 1980s. "Reforming markets can not be left to business alone." "We need a legislative change to institute new anti-trust laws that serve the people" ... as workers and community citizens as well as consumers. In the Conclusion, the authors provide 7 Principles for Reform and offer over 25 Solutions and Remedies in the areas of Antimonopoly and Mergers, Regulation, Patents & Copyright, Shareholders, and What You Can Do! This is the strongest chapter of an already powerful book, as it follows the history of anti-trust principles and legislation from before the industrial revolution in Britain through ups and downs to the critical condition we find ourselves in today. Are we to be sheep for the shearing or active citizens of a representative democracy? Read this book to arm yourself for the fight for economic liberty! Highly recommended. For further research and thought (these are the reviewer's ideas, not found in "The Myth of Capitalism"): * look up the life work and publications of Louis Kelso and the practice of ESOPs (kelsoinstitute.org) * consider that any concentration of monopolistic power is prone to abuse, not just when large private or public stock corporations take control. One example is that public school systems in local jurisdictions are actually under restrictive mandates from state and federal education departments, resulting in their well-documented declining ability to benefit American students with a first-class learning experience, in spite of large expenditures of time, money (and often good intentions). The lack of meaningful competition to the public school may be correlated with dumbed-down textbooks, "teaching to the test" for short-term accountability, and the low status of intellect in the USA. Those who "graduate" are hampered in life by lapses in critical thinking, complex reasoning, and writing ability. Public schools are partly responsible for the fact that adult illiteracy is actually gaining ground since the 1940s. (see: John Taylor Gatto, "The Underground History of American Education," chapter 3, section 40) * Impediments to learning continue with the cartel of public and private universities, linked into an oligopoly by their formal Associations, including the College Board. (Gatto, chapter 3, section 41; Richard Arum and Josipa Roksa, "Academically Adrift: Limited Learning on College Campuses") -----

  26. 4 out of 5

    Javier HG

    Full disclosure first: I know Jonathan through mutual friends, and shared a very entertaining lunch and found him knowledgeable about economic subjects and an entertaining conversationist. With this out of way, I have to say that I found "The myth of capitalism" as a very nice surprise. Some reviews criticized the writing style. I understand beauty is in the eye of the beholder, but reading "The myth of capitalism" was easy and fun. I bought the book because of its different take about inequality Full disclosure first: I know Jonathan through mutual friends, and shared a very entertaining lunch and found him knowledgeable about economic subjects and an entertaining conversationist. With this out of way, I have to say that I found "The myth of capitalism" as a very nice surprise. Some reviews criticized the writing style. I understand beauty is in the eye of the beholder, but reading "The myth of capitalism" was easy and fun. I bought the book because of its different take about inequality, which is an issue that I think will mark the first half of the 21st century. While various authors and pundits signal inequality and the disease, Jonathan and Denise argue that it is the symptom of something bigger: the concentration of economic power, which is also leading to huge political influence (i.e: big pharma). Now, the interesting thing here is that Jonathan and Denise are not brick-throwing leftists. Quite the opposite, they both come from a "capitalist" and free-market background, so its is very difficult to paint them as "out of touch" academics or liberal capitalist haters. They provide ample evidence for their argument. Perhaps the "worst" part of the book is that the windmills that they are describing are way too imposing, we need a Quixotic government. And a government big and strong enough to provide the "domino effect" for other countries to follow suit. It is true that the European Union is leading the way in "nibbling" Google and Facebook and its iron first on data, but it will not be enough if the US government is not on the same page. Overall, a highly recommended book for readers interested in how economics and politics influence each other.

  27. 5 out of 5

    Jiliac

    I am very unsure on how to rate this book. I learned many facts about the economy and its history. It's probably the most convincing explanation I have seen of "why Trump happened", why America seems so broken to an European like me. On the other hand, I felt the authors were getting too emotional in some parts. This is making parts of the book substance less. Furthermore, the authors focus a lot on antitrust intervention and how the government institutions failed the citizens it is supposed to s I am very unsure on how to rate this book. I learned many facts about the economy and its history. It's probably the most convincing explanation I have seen of "why Trump happened", why America seems so broken to an European like me. On the other hand, I felt the authors were getting too emotional in some parts. This is making parts of the book substance less. Furthermore, the authors focus a lot on antitrust intervention and how the government institutions failed the citizens it is supposed to serve. This is certainly true, but I think this has been overemphasized in this book. Government based solution are conceptually simpler, but also the most fragile and easy to disrupt. We can rely on the government to intervene in some outliers cases. But you cannot expect them to do a "systematic" jobs of killing monopolies/oligopolies. I was much more convinced by the idea that government should enable a reduction of the barrier to entry via less regulation and a promotion of small actors. Finally, if I could ask a question to the authors: Why did America economy kept growing at a relatively fast rate considering its already large size? Seeing this book account, one would think that America economy is filled by inefficiencies that would prevent its growth. One answer I could think of was that the astounding growth of its tech sector could compensate for the rest(?).

  28. 4 out of 5

    Andrew

    Real socialism has never been tried, as many are wont to say. This book is trying to articulate a similar theme: real capitalism has never been tried. Or at the very least, if it ever had been tried, today's version no longer resembles it. Monopolies, regulatory capture, and structural inequality are choking at the very foundations of innovation and economic growth, threatening the popularity and viability of what we term capitalism. Without major reform, we cannot return to the bygone era of pr Real socialism has never been tried, as many are wont to say. This book is trying to articulate a similar theme: real capitalism has never been tried. Or at the very least, if it ever had been tried, today's version no longer resembles it. Monopolies, regulatory capture, and structural inequality are choking at the very foundations of innovation and economic growth, threatening the popularity and viability of what we term capitalism. Without major reform, we cannot return to the bygone era of productivity growth and true capitalism. I sympathize naturally with the authors' sentiment, but I find the structure and evidence in this book insufficient. Bailouts, collusion, rent-seeking, and similar behaviors are prevalent throughout history. Why would the modern era be any different? What makes this moment unique? While this is not a diatribe a la Giridharadas (thankfully), the same breathless tone of generalized outrage permeates without a clear delineation of the structural problem or policy solution. Since the time of Adam Smith, the challenges of rooting capitalism within rule of law have been well-known. There is no perfect form of capitalism that will work flawlessly if only we tried it correctly, and the author's attempt to straddle the left-right political divide are ultimately unsuccessful. Read more at https://znovels.blogspot.com/2020/04/...

  29. 4 out of 5

    UndeadRacer

    I admit this book says a lot of wise things on monopolies and the threat to free market competition in 21st century. However, I will give 2 stars since there are quite a few issues with the book: - references are not A class honestly. A lot of articles, papers from little known authors. - right wing bias: criticizes Piketty a lot, but in the piece where Piketty is criticized and accused of mistakes in data, references are lacking, suggesting it is purely an opinion of the authors - political freed I admit this book says a lot of wise things on monopolies and the threat to free market competition in 21st century. However, I will give 2 stars since there are quite a few issues with the book: - references are not A class honestly. A lot of articles, papers from little known authors. - right wing bias: criticizes Piketty a lot, but in the piece where Piketty is criticized and accused of mistakes in data, references are lacking, suggesting it is purely an opinion of the authors - political freedom brings economic freedom, not viceversa, despite what Friedman said. Let’s read Acemoglu and Robinson - right wing bias: regulation is bad and favors monopolists. To a certain degree I agree, but why do oil companies and coal miners reject environmental rules? Why do gig economy companies reject workers rights rules? - accusations of economists. If governments did what world class economists suggest, the world surely wouldn’t be where it is now. How many economists support Donald Trump policies for example? - the idea of limiting transfers from industries and regulators is a good insight. But who should be in regulators then? Guess what? I think the answer is independent experts (id economists!) Price to quality ratio is bad. Also, I bought the book on one of the most powerful company of our time and one of the biggest oligopolist: Amazon!

  30. 4 out of 5

    Mikko Arevuo

    Capitalism without competition is not capitalism! The book presents an impressive amount of research to support the argument that our free market system is broken. Big monopolistic businesses pay lip service to free competitive markets but in reality behave anything but. Regulators are complicit in the emergence of increasingly concentrated industries by passing misguided legislations, or at worst, allowing themselves to be duly influenced by corporate interest. As a free market economist I love Capitalism without competition is not capitalism! The book presents an impressive amount of research to support the argument that our free market system is broken. Big monopolistic businesses pay lip service to free competitive markets but in reality behave anything but. Regulators are complicit in the emergence of increasingly concentrated industries by passing misguided legislations, or at worst, allowing themselves to be duly influenced by corporate interest. As a free market economist I loved the book. It is a story that needs to be repeated over and over again. If we are not able to reform capitalism by regulatory interventions that will increase competition in the economy, we will run a risk of creating a centralised planning system by default. (The emerging narrative by the “progressive” left is clear evidence of this.) I gave the book only three stars, however. I expected that the authors would have spent more time on discussing policy interventions. Policy discussion was treated superficially in the concluding chapter. I felt that that authors had run out of steam by this time. This was a missed opportunity. To take the book’s message forward we need a more detailed understanding of the regulatory frameworks and what can be done to effect change.

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