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Americans, indeed many folks around the world, have an inherent protectionist bent. Their sentiment goes something like this:

  • “we shouldn’t allow American companies to outsource some of their production overseas, because it costs American jobs”
  • “we shouldn’t allow French wineries to sell their wines over here, because that hurts the New York State wine industry”
  • “if we have too many firms selling the same product around the world, that is wasteful and excessive”
  • “if we allow people to trade with whomever they want, pollution and environmental damage will migrate to poorer and less well regulated parts of the world”

And so on. Ignore for the time being the accuracy of any of those statements. I suspect that if you queried people holding these particular views about what they thought about “monopoly” that a large majority of them would also shudder in horror at how big, evil businesses can exploit customers if they have “too much control.”

But hold on a minute. You simply cannot hold both positions, not even as a matter of faith. Take the case of French wines causing problems for New York wineries. If you think competition from high quality international wines takes money out of the pockets of New York vintners, then you must also conclude that competition from Virginia vintners takes money away from New York vintners, or that competition from Long Island vintners takes money away from Finger Lakes vintners, or that competition from Cayuga Lake wines takes money away from Keuka and Seneca Lake vintners! Why is competition from French vintners so awful, but competion from the guy down the road less so? Furthermore, if you want to take this to its logical conclusion, mustn’t you also have the belief that vintners and consumers would be better off if there were just one single winery, say, right here in the western Finger Lakes? But I thought monopoly was bad? Maybe there is a “right” number of firms. Not too many so as to be wasteful and destructive, and not too few so as to be able to exploit us poor customers and workers. That notion is malarkey.

Of course, competition is a glorious thing – it lights a fire under producers encouraging them to innovate, to discover the needs and wants and desires of current and potential customers, to figure out ways to deliver higher quality and lower costs, and it helps us consumers sort out the wheat from the chaff.

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