The Power of Personal Choice
Milton Friedman on Monopoly
What is the largest monopoly? Government. Check out our Facebook page here: https://www.facebook.com/FreeToChooseNetwork Visit our media website to find othe...
Monopoly isn't just a board game you play with friends (who may or may not still be your friends by the time you're done). It's a real problem when one person or company gains control of a large portion or all of a particular product in the marketplace.
Remember the skyrocketing cost of the Epi-Pen? Many people need it for life-saving antidotes to allergic reactions, but the manufacturer jacked up the price without recourse for consumers.
How did this happen? Why did the manufacturer increase the price? Well, we can thank the Food & Drug Administration and their literal creation of a monopoly on the Epi-Pen for that manufacturer.
Economist Milton Friedman explains how monopolies occur.
In the United States the most important and the strongest monopolies are unquestionably those that derived from governmental privilege. The monopolies of a TV license granted by the government at a zero price, that's a source of monopoly privilege it also has been a source of wealth for some notable Americans.
Another example of a government-sustained monopoly is in the power industry. In my area, for instance, there is one power company, no other option. Its prices are subject to regulation and limitation by the state legislature, but it is the state that decides who gets to provide the power. Were the state not involved, someone else likely would have come along and offered a better deal for consumers by now, don't you think?
Friedman's solution is simple: free trade.
Eliminate all tariffs and all restrictions on foreign trade and you enable the world to come in as competition to prevent domestic monopolies. Wouldn't that do a great deal more good in preventing monopolies then would a limit on the size of enterprises, with much less restriction in human freedom?
The largest monopoly is the government itself, and it has unrivaled power in almost every society on earth. We need to work to reduce the power of that monopoly, and in the process we will also help to prevent market monopolies from forming.
The result will be increased competition, and lower prices and higher quality for us, the consumer. I'm definitely on board with that.