Competition


President Trump:

Trump did not give details about what his administration would do to protect manufacturers, but he railed against tariffs charged by other countries and unfair trade practices.

“That includes cracking down on the predatory online sales of foreign goods, which is absolutely killing our shoppers and our shopping centers,” he said.

“Killing our shoppers”. Really? Shoppers enjoy shopping online, that’s why they do it. If they didn’t find it beneficial they’d shop in shopping centers. So its up to the shopper where to shop, not politicians. Shopping centers have to step up their game to compete with online. The heavy hand of government will stifle innovation, disadvantage their competitors, and freeze the current situation. Improvements will cease. That’s why the country of Cuba is stuck in the 1950’s.

That’s not sustainable. What is sustainable is free market competition that will continually produce what’s best for consumers and producers. That’s what he and Republicans claim to want in health care, so the same principle applies to retail.

Here.

The WSJ has a report by James Freeman (behind firewall) on the progress the Trump Administration is making reducing the power of Washington’s permanent bureaucracy, aka the Swamp.

At the State Department:

the State Department is one federal agency that was actually contemplated by America’s founders. Conducting foreign policy is an important and necessary task for our central government. But like so much of the Beltway bureaucracy State has been overfunded and undermanaged for years. Now, despite what you may have read about untouchable bureaucrats unaccountable to the public they are supposed to serve, Mr. Tillerson has found ways to clean house. . .

Furniture from now-closed offices crowded the hallways. Dropping in on one of my old offices, I expected to see a former colleague—a career senior foreign service officer—but was stunned to find out she had been abruptly forced into retirement and had departed the previous week. This office, once bustling, had just one person present, keeping on the lights. . . .

[Sec. of State] Tillerson is not reorganizing, he’s downsizing.

Yes, even constitutionally approved functions need reorganizing, and reorganizing can involve downsizing people and functionality. If ever there were monopolies, government is it. And government monopolies are susceptible to the same abuses as other monopolies. The people there become arrogant, careless, insular, lazy, corrupt. Absent competition, its inevitable no matter how well-intentioned.

There’s movement at the EPA:

Meanwhile over at the Environmental Protection Agency, new boss Scott Pruitt is not just draining the bureaucratic swamp in Washington, he’s taking away the agency’s power to oversee swamps nationwide. . . .

to dismantle another piece of the Obama administration’s environmental legacy, the rule that sought to protect clean drinking water by expanding Washington’s power to regulate major rivers and lakes as well as smaller streams and wetlands. . . .

In a speech at the Energy Department, the president promised to expand the country’s nuclear-energy sector and open up more federal lands and offshore sites to oil and natural-gas drilling.

. . . rescindment this week of the Obama administration’s clean-water rules that farmers and business groups found onerous.

. . . issued a special permit authorizing the construction of a new pipeline between the U.S. and Mexico that would carry fuels across the border in Texas

Its not all positive, though. Healthcare reform could fill the swamp rather than drain it. More military activity in the Middle East and Korea could fill the swamp.

 

The $85 billion acquisition of CNN parent Time Warner by AT&T could win antitrust approval by the Justice Department in the next 60 days, sources said.

During the presidential campaign, Candidate Trump said he would not allow this merger. I’m pleased to report that common sense prevailed as President Trump needs to focus on effective management of government operations instead of trying to managing economic activities for which the future remains unknown. Draining the swamp IS way more important. Disallowing this merger would fill the swamp more by adding more rules and regulations.

Pols and regulators should butt-the-hell out of corporate mergers and other actions that disrupt the status-quo. See Democrat primary loser and hypocrite for supporting corporate shill Hillary Clinton Bernie Sanders for example. Trump also said he opposes it.

Employees of the merging firms must figure out how best to serve their customers and shareholders.

Remember folks, firms have to work within the current regulatory and legal framework. If gov’t wants to do something useful it should deregulate telecom and scrap net neutrality. Those constrictions led the decision-makers in this deal to view a merger as a way to drive growth.

The interventionist fear is based on outdated definition of monopoly. Standard Oil’s so-called “monopoly” lowered kerosene prices “from 58 to 26 cents from 1865 to 1870. Competitors disliked the company’s business practices, but consumers liked the lower prices.” https://en.wikipedia.org/wiki/Standard_Oil.

Yet, some politicians and activists want to stop this merger because they are simply afraid of change.

You can let firms experiment and innovate to figure out how to serve customers and grow, or you can let politicians protect the status quo and continue with 1% GDP.

 

But instead of reform, congressional Republicans are moving forward with legislation that tinkers around the edges. Their bill adjusts retiree health care, hikes stamp prices, and retains six-day delivery despite a 40 percent drop in letter volume since 2000. The bill would also create “new authority to offer non-postal products,” thus threatening to increase the tax-free entity’s unfair competition against private firms.

The Democrats overseeing postal issues are happy as larks with the GOP bill, which appears to be a victory for unionized postal workers. You might wonder what the point of electing Republicans to Congress is if they are just going to let Democrats run the show in defense of unions and monopolies.

Here.

 

 

President Barack Obama will call for new government spending on infrastructure, education and research in his State of the Union address Tuesday. . .
While proposing new spending, Mr. Obama also will lay out significant budget cuts elsewhere, people familiar with the plans say, though they will likely fall short of what Republican lawmakers have requested.

Great that the president will identify spending cuts but, really, why is this spending going to be any different from the spending politicians have been doing for decades anyway? Even before the financial mess government spending was too high. It’s the same old, same old. There is no magic elixir that combines President Obama’s spending with the spending of the 2011 Republicans and Democrats to produce “We seek to do everything we can to spur hiring and ensure our nation can compete with anybody on the planet. . . ” to quote the president.

Here.

It will not produce the economic version of Love Potion Number 9.

Whatever you call it, a growing number of companies are beginning to see better times ahead — and are taking steps to ensure that they get their share of the pie.

Kind of a misleading formulation of commerce by economist  Irwin Kellner.  Firms and people do not fight for slices of a fixed size economy in a capitalist economy.  They do so in a politicized economy.

If a firm wins new sales, losing firms did not lose business.  They just did not grow and create new wealth.  If a firm takes away sales from an another firm, the latter did indeed lose wealth.  But that is the result of the winning firm providing a better value proposition.  In both cases, overall wealth is created, the customer benefits, and the broader society benefits.

In any case, Mr. Kellner is describing recent positive economic developments.

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