Warning against “monopoly fatalism,” the Cato Institute’s Ryan Bourne says: Time was, the A&P grocery chain was the entrenched “Amazon of its day,” with almost 15,000 stores by 1935. Seen one recently? Between 1976 and 1978, the government worried that IBM might have a monopoly on the “office typewriter industry.” A November 2007 Forbes cover story asked, “One Billion Customers — Can Anyone Catch the Cell Phone King?” Apple? No, Nokia. But Apple’s iPhone had arrived in June 2007. Bourne says Kodak’s domestic position in photography once “was even more dominant than Apple’s position in the mobile vendor market today.” “Who Will Break iTunes’ Monopoly?” asked a 2010 British headline. Fifty years ago, Xerox’s almost 100 percent of the photocopier market aroused antitrust complaints. Twenty-five years ago, the browser for about 90 percent of Internet users was the Netscape Navigator. In 1997, the year Google was founded, Yahoo dominated the search engine market. Twenty years ago, AOL had an estimated 90 percent of the instant messaging market. “Will Myspace ever lose its monopoly?” asked a Guardian technology writer in 2007, when it was the most-visited website. In 2008, it had an estimated 73 percent of all traffic on social networking sites. Remember when WordPerfect was considered an unchallengeable word-processing program?
-George Will (Washington Post)
At the macro level, I hear the same thing about Germany cleaning our clock internationally. Then it was Japan. South Korea, The Asian Tigers, and currently, China.
The problem is that the doomsayers were wrong – and almost always are over the long run. Certainly the US has its own share of problems and some of them are unique to the US. That said, even with the heavy hand of Government being applied more and more (as Progressives and “Hate America Firsters” all keeps saying we need to be like other countries instead of valuing America and our culture as being the reason for our success), our economic system is still more dynamic than almost anyone else’s.
And within our economy, as Will points out, status quo doesn’t last all that long but what seems to be a monopoly may, in short, not be. Capitalism is “creative destruction” – that good ideas can overthrow the status quo. New inventions can totally overturn the marketplace for established industries (e.g., the Personal Computer destroyed both the Workstation and Minicomputer industries 50 years ago, cell phones are killing off landlines, and storage containers revolutionized shipping) or create brand new industries (e.g., biotech) that expand the entire marketplace. In each case, those companies that were dominate fell by the wayside as these “Disruptors” took hold.
And in each case, the totality of personally owned wealth increased – not just for Founders but for everyone. While everyone looks at Bill Gates, they forget about the thousands of millionaires that Microsoft created.
And one thing that IS sure – that pundits will be mostly wrong over the long term.
