Additionally, market discipline means that even if you do get into a situation of Stalin managing Apple (or more realistically, Fiorina managing HP), it doesn't hurt me.
If HP makes crappy computers (or simply too few), I'll buy Lenovo. In contrast, if Stalin makes too little food, I'm hungry.
The entire purpose of corporations in a capitalist society is to get the benefits of central planning (technocratic experts engaging in central planning to achieve results better than free markets) without the harms (nowhere else to turn if the technocratic experts screw up). So far, they seem to be doing a great job of this.
That's only really true if you also support antitrust laws, though (i.e. don't support laissez-faire capitalism). If you end up in a situation with entrenched whole-sector monopolies and high barriers to entry, it becomes much harder to buy an alternative, so the owns-all-computer-manufacturing HP could get away with shitty management for years or decades, and buy up or drive out of business (e.g. through temporary dumping) any nascent competitors.
I don't disagree, but monopolies are generally unstable. HP and Microsoft are hardly dictating terms anymore. Their ability to erect barriers to entry is weak, unless they are getting help from the gov't. See telecoms & utilities.
Antitrust is often ineffective in practice. Sounds great in theory, but it is also a form of central planning. The best the gov't can do, in my opinion, is reduce the barriers to entry that it itself erects. Highly regulated environments, for example, usually protect incumbents.
I agree when it comes to the headline enforcement actions (breakups, etc.), which are done in a pretty haphazard way with questionable effectiveness. But I think the existence of the body of law does discourage the most egregious types of monopoly-protection activities. For example, few companies will do things that look too much like outright dumping, stuff like giving your product away for free for 12 months in order to crush your new startup competitor who's secured 12 months of funding.
That example doesn't bother me too much, though there are plenty of smart folks who would disagree. I don't like IE's dominance, which dates back to exactly what you describe (vs Netscape).
But the outcome is that the Internet became a mass phenomenon. I don't think it would obviously have been so if Netscape and MS charged for browsers. Heck, companies used to charge for TCP/IP stacks. Dumping looks pro-consumer in this context.
In theory, that is indeed an issue with natural monopolies.
In practice, however, the only areas I can think of where actual monopolies exist are areas with government granted monopolies, e.g. telco/cable or patent trolls. I'm sure there are a few natural ones, however.
But you did catch me - I'm not a laissez-faire capitalism purist. I just think it's a pretty good first approximation.
Then again, if Countrywide and Lehman and many others are allowed to make many million fraudulent mortgages, which end up blowing up trillions of dollars of wealth, it really hurts a lot of people. Unregulated markets, and the uses fraudsters can put them to, can really screw over an economy.
a) Mortgage issuers tended to be the victims of fraud, not the perpetrators. The people committing fraud were mostly mortgage brokers and and home borrowers.
(Mortgage issuers are now using fraud to cover up lazy paperwork after the fact, but that's a separate matter.)
b) The mortgage market doesn't even come close to being an "unregulated market". While you can dispute the extent to which the regulators played a role, it's indisputable that the regulators were solidly on the pro-bubble side of the fence.
Confused?
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a)Tell me again, how much money did Angelo Mozilo and Dick Fuld lose due to the mortgage fraud their companies engaged in? Go listen to William K Black on the subject of control fraud, and tell me that the issuers were the victims. Some of the stockholders and bondholders were victims, but the guys who ran the companies made out like bandits.
re
b) "Unregulated" is perhaps an overstatement. Would "substantially less regulated" or "Markets where the regulators regularly turned a blind eye to rampant fraud." work better for you? Greenspan has a lot to answer for, as do the OCC, OTS, and Congress. Go read about the FBI report in 2004 of "rampant mortgage fraud" and the total lack of interest on anybody's part of taking any action on it. Note that they just issued another report that it's still going on.
And if Angelo Mozilo and Dick Fuld hadn't approved of it, Countrywide and Lehman would not have been making liars loans. And if regulators had been doing their jobs, the mortgage brokers originating those loans would have been prosecuted.
If HP makes crappy computers (or simply too few), I'll buy Lenovo. In contrast, if Stalin makes too little food, I'm hungry.
The entire purpose of corporations in a capitalist society is to get the benefits of central planning (technocratic experts engaging in central planning to achieve results better than free markets) without the harms (nowhere else to turn if the technocratic experts screw up). So far, they seem to be doing a great job of this.