Ramblings & ephemera

Why American car companies are in trouble

From Paul Ingrassia’s “How Detroit Drove Into a Ditch” (The Wall Street Journal: 25 October 2008):
This situation doesn’t stem from the recent meltdown in banking and the markets. GM, Ford and Chrysler have been losing billions since 2005, when the U.S. economy was still healthy. The financial crisis does, however, greatly exacerbate Detroit’s woes. As [...]

More on Fordlandia

From Mary A. Dempsey’s “Fordlandia” (Michigan History: July/August 1994):
Screens were just one of the Yankee customs transported to Fordlandia and Belterra. Detroit physician L. S. Fallis, Sr., the first doctor sent from Henry Ford Hospital to run the Fordlandia medical center, attempted to eradicate malaria and hookworm among Brazilian seringueiros (rubber gatherers) by distributing [...]

Henry Ford’s debacle in the jungle

From Alan Bellows’s “The Ruins of Fordlândia” (Damn Interesting: 3 August 2006):
On Villares’ advice, [Henry] Ford purchased a 25,000 square kilometer tract of land along the Amazon river, and immediately began to develop the area. …
Scores of Ford employees were relocated to the site, and over the first few months an American-as-apple-pie community sprung up [...]

Word of the day: creative destruction

From Wikipedia’s “Creative destruction” (13 July 2006):
Creative destruction, introduced by the economist Joseph Schumpeter, describes the process of industrial transformation that accompanies radical innovation. In Schumpeter’s vision of capitalism, innovative entry by entrepreneurs was the force that sustained long-term economic growth, even as it destroyed the value of established companies that enjoyed some degree of [...]

Wal-Mart’s monopsony power damages its vendors

From Barry C. Lynn’s “The Case for Breaking Up Wal-Mart” (Harper’s: 24 July 2006):
Instead, the firm is also one of the world’s most intrusive, jealous, fastidious micromanagers, and its aim is nothing less than to remake entirely how its suppliers do business, not least so that it can shift many of its own costs of [...]

Antitrust suits led to vertical integration & the IT revolution

From Barry C. Lynn’s “The Case for Breaking Up Wal-Mart” (Harper’s: 24 July 2006):
As the industrial scholar Alfred D. Chandler has noted, the vertically integrated firm — which dominated the American economy for most of the last century — was to a great degree the product of antitrust enforcement. When Theodore Roosevelt began to limit [...]

The mirror of monopoly: monopsony … which may be worse

From Barry C. Lynn’s “The Case for Breaking Up Wal-Mart” (Harper’s: 24 July 2006):
Popular notions of oligopoly and monopoly tend to focus on the danger that firms, having gained control over a marketplace, will then be able to dictate an unfairly high price, extracting a sort of tax from society as a whole. But what [...]

Corporate consolidation reigns in American business, & that’s a problem

From Barry C. Lynn’s “The Case for Breaking Up Wal-Mart” (Harper’s: 24 July 2006):
It is now twenty-five years since the Reagan Administration eviscerated America’s century-long tradition of antitrust enforcement. For a generation, big firms have enjoyed almost complete license to use brute economic force to grow only bigger. And so today we find ourselves in [...]

Macaulay in 1841 on the problems on the copyright monopoly

From Thomas Babington Macaulay’s “A Speech Delivered In The House Of Commons On The 5th Of February 1841” (Prime Palaver #4: 1 September 2001):
The question of copyright, Sir, like most questions of civil prudence, is neither black nor white, but grey. The system of copyright has great advantages and great disadvantages; and it is our [...]

Developing nations stand up to US/UN bullying on copyright

From “Statement by India at the Inter-Sessional Intergovernmental Meeting on a Development Agenda For WIPO, April 11-13, 2005” (emphasis added):
“Development”, in WIPO’s terminology means increasing a developing country’s capacity to provide protection to the owners of intellectual property rights. This is quite a the opposite of what developing countries understand when they refer to the [...]

Early attempts to control phone usage

From R. W. Kostal’s Law and English Railway Capitalism, 1825-1875 (quoted in Andrew Odlyzko’s “Pricing and Architecture of the Internet: Historical Perspectives from Telecommunications and Transportation“):
In Britain in 1889, postal officials reprimanded a Leicester subscriber for using his phone to notify the fire brigade of a nearby conflagration. The fire was not on his premises, [...]

Monopolies & Internet innovation

From Andrew Odlyzko’s “Pricing and Architecture of the Internet: Historical Perspectives from Telecommunications and Transportation“:
The power to price discriminate, especially for a monopolist, is like the power of taxation, something that can be used to destroy. There are many governments that are interested in controlling Internet traffic for political or other reasons, and are interfering [...]

Railroads & tolls

From Andrew Odlyzko’s “Pricing and Architecture of the Internet: Historical Perspectives from Telecommunications and Transportation“:
Railroads were the dominant industry of the 19th century. … Early railroad charters, in both England and the U.S., were modeled after canal and turnpike charters, and almost uniformly envisaged that railroad companies would not be carriers themselves. Instead, they were [...]

Canals & tolls

From Andrew Odlyzko’s “Pricing and Architecture of the Internet: Historical Perspectives from Telecommunications and Transportation“:
The modern canal era can be said to start with the Duke of Bridgewater’s Canal in England. Originally it was just a means of connecting the Duke’s colliery to Manchester. The parliamentary charter (which enabled him to take over private property, [...]

The ACLU on monopoly control by ISPs

From the ACLU’s No Competition: How Monopoly Control of the Broadband Internet Threatens Free Speech:
Common carriage policy requires that a network owner - in this case, a telephone company - not discriminate against information by halting, slowing, or otherwise tampering with the transfer of any data. The purpose of common carriage is to prevent a [...]