The reactions to my post on fixing capitalism have surprised me: almost everyone who has blogged or tweeted on it agrees with the broad thrust of what I advocate. For proposals so far from the political mainstream, what does that mean? Perhaps is shows how for the politicians are from a popular demand for change. There also a few points that need replies.
The most important thing I have to say is the need to fight neo-mercantilism. Many people have hardly noticed the drift from pro-free markets and competition to pro-business and hang competition, so merely talking about it wins the first round.
The proposals on copyright and patents have attracted little criticism, probably because the readers I have got so far are familiar with the audience. To those who disagree, I have one question: where is your evidence? My proposals reflect the evidence I have been able to find: some of it is linked to (not always directly). If there is good evidence to contradict it, please tell me about it.
Some people have practical objections to breaking up of companies with too much market share. I accept that it cannot necessarily be applied to all industries. It is very hard to imagine breaking up Google into ten bits would be productive, for example. I do think that this approach would work in most industries: old media, retail, most manufacturing, banking and financial services, etc.
The point is that the burden of proof would be reversed, and much less would need to be proved. At the moment an existing monopoly may only be dismantled if the monopolist can be proved to have behaved in certain ways that are considered abuses of monopoly. What I am proposing is that the monopolist should be required to prove that the public interest is best served by allowing the monopoly to continue.
Where are monopoly is allowed to continue, they should also be required to show why one of the following solutions (in order or preference) should not be applied to them:
- Mutualisation: they should be owned by their customers.
- Tight regulation: in the way that telecoms is regulated in the EU.
- Nationalisation: only if the other two are not possible and the business is one that a government is likely to run well.
Even where the monopoly is allowed to continue, we could improve it by forcing the spin-off of businesses that do not need to be owned by the monopolist. This would prevent bundling and other ways of extending the monopoly.
Although I did not think in quite those terms at the time, what I wrote is, as Alan Patrick pointed out a draft manifesto. Please point out the flaws and omissions (comment here, blog about it, tweet about it) and I will do my best to improve it.
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