So let’s start with a fundamental truth about Milton Friedman’s moral thinking – what he thinks it fundamental to a just society. It’s about liberty, and liberty is defined as freedom from coercion. The perfect society is the one where no one can tell you what to do.
Primarily on economist, he’s most concerned about economic structures. What kinds of economic systems prevent the most coercion and violence? That’s the economic democracy of the free market. There, you’ll find potentially infinite variety of business, product, and service – whatever an enterprising huckster can produce with ingenuity and materials at hand.
A frequent argument – at least in the 1960s, when Friedman was writing Capitalism and Freedom – against a totally free market was that the state needed to have the power to break up monopolies.
Monopolies create situations of mass vassalage to a single company or small group of business magnates in an entire industry. Say an industry began as a bunch of little companies.
But some company makes a technological innovation that gives it an enormous advantage over competitors. Their technology disrupts the balance of the entire sector. It either buys up all their competitors or forces them into bankruptcy.
|The entrepreneur is a truly virtuous man.
* Or most diabolical, however you want to think of the practice.
Such monopolies, says Friedman, are never stable. Most of the time, they aren’t even true monopolies. Free market competition – some little upstart who refuses to be bought or contained – will overcome even the most aggressive big player.
No, to Friedman, the only true and stable monopolies are those supported by the government, or state-owned companies themselves. Or else, they arise through an unjust collusion, as industry heads conspire together to stifle genuinely competitive market relationships – price-fixing, or supply control.
Either way, it all comes back to the government. Because if a government doesn’t want to tolerate some kind of industry collusion or monopoly, they can smash it. They have gladly. So a government has to build a monopoly through a state corporation, colluding with business magnates, or turning a blind eye to the collusion of business magnates.
Well, that’s not really so true anymore. I think it may have been true, or at least the rule had few enough extensions to stand. At least it did in the 20th century.
|You have to understand that people really used to look like that
when Monopoly the board game was invented.
If you consider the economic conditions of 21st century Earth, you’ll see a situation where disruptions create real monopolies – or at least business models whose ultimate stated goal is to become a monopoly. That’s literally Uber’s corporate mission.
This is the ideal of fortune through disruption in Silicon Valley’s business culture. You develop a particular kind of technological disruption – a communications platform that lets you undercut the labour of an entire industry at once. Your profit is built on finding ways to lower labour standards legally, and pocket the entire difference yourself.
It’s a problem that I find libertarian concepts are inadequate to dealing with. If your labour conditions get worse and worse – more and more time on the job for less and less money – how can any contract between a pauper and an oligarch ever be fair?