A
monopoly exists when competition is stifled. Monopolies, whether
created by government, enforced by law, enforced by professional
associations or created by the private sector, by removing
competition are driving costs upwards.
While
sometimes introduced in the "interest of the people",
such as government nationalization of a particular industry,
even if arguably they may have an immediate positive effect,
invariably are disastrous in the longer term.
Monopolies
introduced by industry, in the interest of standardization,
salary levels, or pure greed, are invariably against the
interest of the people at large.
Some
monopolies are difficult to identify. The litmus test is to see
how difficult it is to become a player in that field.
Hypothetical
examples:
If
you are a corporation with experience in financial matters and
adequate capital, how easy it is to become one of the
"accredited" Canadian banks (able to lend
money on behalf of the Bank of Canada)?
If
you are an energy producing corporation, how difficult is it
to sell your product through the existing networks?
If
you are a doctor, how easy is it to become a member of the
Canadian Medical Association? Does it depend on where you got
your qualification from?
If
you are a health insurance provider, how easy is it to provide
insurance to customers in the free market?
Monopolies,
whether government or corporate, stifle progress and lower
people's standard of living (apart from the privileged).
It
is often difficult to understand that "universal"
government programs, become monopolies whenever the provided
service is not available for public contest. It then is
administered by bureaucrats and eventually becomes more
expensive and less valuable.
When
a government monopolizes (nationalizes, intervenes in) more and
more areas of public life, education, economy, communication,
industry, etc. it needs to defend this newly acquired power by
law and possibly force, thus becoming a dictatorship.
When
a corporate entity is allowed to monopolize a particular product
or service, an artificial cost is created for this product or
service which favours the corporate entity, but not the people
at large. As more corporate monopolies are allowed, the free
market economy collapses.
Laws
to avoid corporate monopolies are called (in the U.S.) antitrust
laws.
