slayerment said:
The word collusion comes to mind and makes me think that that's not choice in any meaningful sense of the word.
slayerment said:
This is one of the premises of free marketeers that I really struggle with.
I don't think a monopoly is at all impossible, but more importantly I think oligarchy seems to be a more resilient form of dominance and I think history shows that. And in my opinion oligarchy cannot be considered a free market.
Do you think this is a possible, if somewhat oeversimplified, potential circumstance in the aftermath of the eventual dissolution of governments?
What used to be corporations in let's say the oil business are now freed from the regulations once imposed on them by states. They claim, buy, lease, and contract with others for land rights to go about their business.
With a relatively high barrier to entry buffering serious competition in the short term, the CEOs and trustees of the various former companies rub elbows as their paths occasionally cross and, now liberated from the strictures of rico laws and other hindrances, they talk more freely about working together to support, protect, and increase their mutual interests.
Out of these discussions comes an agreement between a number of the industry leaders to fix prices across the range of their products and services, to monitor competition together, discuss strategy collectively rather than separately, and to work on bringing the remaining players on board with their plans.
The arrival of a few startup companies who see these fixes in the market as opportunities begins to worry these industry leaders, and they agree to pool their resources together to buy them out. A couple of the startups decline their offers, so the industry leaders decide to retain the services of some contacts that they did business with when entities named the CIA and Blackwater once existed. These gentleman progressively stifle the startups with covert force and psychological warfare.
Unfortunately one of these jobs is a bit sloppier than the industry leaders would have liked, and the family members of the startup that was sloppily silenced contact the party with whom their former family members had contracted to insure their commercial assets. The insurer concludes that they should proceed with an investigative inquiry regarding the nature of the industry leaders' involvement with the deaths of several people in the drilling startup and the fires that wiped out their drill rigs. They call their preferred adjudicative service and notify the industry leaders of these goings on.
The industry leaders, not happy about this predicament, pay their own adjudicator an enormous sum of money to make the problem go away. Fortunately for the industry leaders, the high cost of entering the drilling business left the recently expired startup drillers with little money left over for insurance, so their insurer does not enjoy the connections and clout that the industry leaders' insurer has. Luckily too for the industry leaders, the adjudicative service provider furnished by the former drillers' insurer has a few pieces of dirty laundry that the industry leaders' adjudicator can explore.
The industry leaders' adjudicator uses a portion of the money to hire an intelligence agent to expose the grieving families' adjudicator for past malfeasance. He uses a portion of the money to pay media contacts to highlight the grieving families' adjudicator's malfeasance in the press, tarnishing the integrity of their dispute resolution capabilities. He offers a portion of the money to the families themselves to make them go away, which they do except a couple here and there. He uses a portion of the money to buy alibis for the industry leaders and their black ops contacts, weakening the strength of the grieving families' case. He uses the rest of the money to buy the CEO and head adjudicator of the grieving families' insurer new planes.
The case ends with some minimal payouts for lost equipment and no liability found for the industry leaders' involvement in the tragic fires that beset the startup drilling business. There is one persistent grieving family member who will not let the issue rest, and he hires additional investigators with his own secret stash of funds, determined to seek justice. Then his dog is shot with a high powered rifle while he is playing in the yard with him. Then his sister is run off the road and almost dies. He decides to cancel his contract with his investigators. Soon thereafter a large sum of money is inexplicably wired into his bank account.
The case leaves a bad taste in the industry's mouth, but only just enough to let the other industry players know that they have a bully in their midst. To all other interested and disinterested people not related directly to the case or the industry, this and a few similar incidences are all but forgotten in a couple generations.
Meanwhile, a couple of the other industry leaders who were not party to these and other related goings on have since accepted invitations to help the other industry leaders further their cause, perhaps seeing the writing on the wall and conluding if they can't beat them then join them. This leaves a small but significant minority of the drilling industry outside of the influence of this group of industry leaders. The industry leaders decide to compel their acceptance or force them out of the market so, unannounced, they release a significant portion of their reserves, triple production, and flood the market with their products and services. This unprecedented saturation drives prices to a point below which many of the remaining industry players can sustain their positions in the market. A few of them close and liquidate their assets, a few agree to mergers and acquisitions with the industry leaders' businesses, and a few are left standing. Of these, two take the hint and begin fixing prices according to the oligarchy's signals, eventually coming into the fold. One does not, so they repeat the cycle and force this competitor out of business.
The industry leaders are now more or less in control of the oil production market, which is nice for them because they are well enough connected amongst themselves to not only set prices to whatever they want but also to stifle any competition that arises and perpetuate the media and marketing mythology that the people they sell to are free to choose from a variety of many different companies. Their strength in numbers and dominating connectivity throughout other industrial circles of power allows any one or few of them to be attacked and even seriously injured without risking the integrity of the cartel itself. They fake feuds in the press, deliberately lose adjudications from time to time, start new brands and advertise them as startups, and generally make sure things look like a free market to all outward appearances.
Perhaps at a later junction a group of people come together with an enormous amount of capital, determined to break into the oil production industry. The industry leaders, seeing this coming, might even have to break their free market camouflage and expose themselves for who they are by waging what would amount to war against these people, right out in the open. Their customers, shocked at the market suppression and outright tyranny of the industry colluding together, would perhaps be determined to seek energy elsewhere. And maybe that would be the end of the industry leaders and their oligarchy. Or maybe they'd try to silence alternative energy sources. Or maybe they'd just buy those alternative energy sources and further their illusion of choice.
I'm sure there's plenty wrong with the above story but I think it gets the point across. Do you think this kind of scenario is plausible?
Very cool.
