Capitalism usually means more productivity than Communism, except where monopolies rear their ugly heads. But wait, Communism is the definition of monopoly.
Anyway, it is not the free market that causes these problems, but that bean counters are allowed to dictate something that the market should be dictating.
Unfortunately, there are a lot of natural and govern-cement created monopolies in capitalism. Being aware of what, and how these monopolies function is important for trying to come up with better systems of governance in the future.
The Electric Company
One thing that so often impacts our lives in first world countries is power outages and brownouts.
Brownouts could be done away with if we had more excess in the system. More power available than we needed. But, this goes straight against the bean counter mentality.
Would you build a power plant (lots of time and money) if it would only be used 3 weeks a year? And, it would either need to be run at low levels for the rest of the time, or go through a lengthy start-up and shut-down process. (that may not work. Problems often occur when switching on big machinery) The answer is no. You would not build such a power plant, unless the customers promised to pay a years worth of income in those three weeks.
As a bean counter, you want to run your power plant at 100% all the time, selling all the energy you could make. This is the most economically efficient way. Businesses don't make money when they are just sitting there making nothing. But, that is exactly what we are asking of power producing companies when we want them to cover 100% of the peak summer usage. The bean counters can't stand running plant at less than 50% for most of its life.
Now, if we were just focussed, as the customers, on having enough electricity all the time, we may easily pay for the extra power plant. The power plant is not that big of a price-tag when compared to the continuous fuel cost of running it.
If we just focus on the share holders, this stuff is unacceptable. We should only look at things that will increase our bottom line. Building an extra power plant that will practically just sit there is a complete waste of money. The electric company isn't going to be losing any customers because they have brownouts.
And that is the problem of a monopoly.
The Price of Fuel
Ever notice that the price of gasoline jumps up whenever you hear a story of problems in the middle east? Although it will be months before the new, higher priced oil, makes its way to the oil refinery!
Further, America was almost oil independent when we were going gangbusters on fracking. But, still, a middle east problem and the gas price jumps up.
We supposedly do not have a monopoly on gasoline sales, but the market sure acts like it. And if we look into it, we find that it is really a few cartels, and that the variety of gasoline selling companies is just false choice.
It is like the choice of cereal at the grocery store. There may be different names on the boxes, but it is all the same stuff. And, there are many items that literally come from the same factory, same manufacturing line, with different labels. It is an illusion of choice.
We have very few mom & pop gas stations left. The big (supposed) gasoline producers all have their own gas stations. Usually seen competing on the same street corner. So, there seems to be competition.
But, all the prices seem to rise and fall in lockstep.
But, if you watch, the tanker truck comes to fill up one gas station, and then drive across the street to the other gas station to fill it. (yes, these trucks have separate compartments in that tank, but…)
What we see is a group of companies that all change their prices at the same time, and do not charge based on oil price, but based on the price they think they can get the most out of the captured customers.
Energy companies are highly regulated and if you look deeply, you find them all owned/controlled by the same group of people.
They are a monopoly, with the façade of choice.
Unfortunately competition in these markets will be resisted to the full extent of the law(fare) and beyond. (yes, people who tried to build a trash fired power plant had their lives threatened by various groups)
So, real competition will not be allowed in these markets.
But, since they are gouging us, playing us, this will end. Cosmic forces will move and destroy the cartels. Just like the Berlin wall came down. Competition will come from either the market moving or invention leaving the old market dead.
We should have never conceded to allowing these groups to be monopolies, but we believed it would be cheaper to avoid multiple electric lines and such.
Anyway, the bean counters idea of perfection is monopoly. Do not listen to the bean counters.
It ain't much but savings add up.
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