Turnabout is Foul Play


Declan McCullagh writes that Microsoft's affection for laissez faire, in evidence when they were the subject of DoJ probes, has faded now that they've got high-powered lobbyists working to give them a "competitive" (and I use the term loosely) advantage via regulatory policy. Exactly what are all their closed door meetings with FCC officials about? They won't say…

NEXT: Baptists for Bigger Bottles

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  1. So is Cato going to return all of that dirty Microsoft/Bill and Melinda Gates Foundation money now?

    I can’t wait for all the op-eds from Cato people detecting the sinister hand of the neocon behind Microsofts’s turn.

  2. they should use the money to go on a publicity blitz against Mircosoft. maybe the company about to be rammed by MFST would then fork over some cash to Cato…

  3. Naturally! The only honorable thing for a free market think tank to do is cheerfully refund the money when its free market analysis conflicts with the regulatory interests of its corporate sponsors. But in the interests of efficiency and saving time, it would probably save time for any free market think tank with intellectual integrity to just say “No thank you” in the first place. After all, whenever you start criticizing USDA policy or food libel laws, you have to give back that Monsanto money; questioning IP means forking over to Bill Gates and Big Pharma; and so on.

    If we lived in a laissez-faire world, Bill Gates would be shaking hands with George W., his fellow assistant manager, at the annual Wal-Mart shareholders meeting.

  4. “No thank you”

    lobbying isn’t cheap, even for free marketers.

    and why not just keep the money and find a replacement sponsor (i.e. the company that will get screwed by the new regs)? i doubt MFST is asking for a refund, they would probably just cut off Cato if something offended them.

  5. Let me just second that. Think tank funding isn’t (well, shouldn’t be, and isn’t at Cato) fee for service. You make your contribution and take your chances. If you don’t like what their scholars say the following year, hey, you don’t have to make another contribution. And by the same token, the tank should take money freely contributed and put out what its people think is right. If a donor was expecting kid gloves as a quid pro quo, well, that’s their problem.

  6. Good points. But I have to add, in fairness to Mr. Gates, that no free market think tank accepting donations from a giant corporation should be surprised by a conflict of interest. As the Serpent told the Maiden, “You knew what I was when you picked me up.”

  7. For a good picture of how Uncle Milty applied the abstraction to reality, take a look at Chile, where Pinochet played Dionysius to Friedman’s Plato.

    My objection is not to compromises to push reality closer to a free market. But I’d like to be actually CLOSER to a free market, not further away from it. My objection is to corporatism falsely packaged in “free market” rhetoric–for example drug company spokesmen who piously denounce the “anti-market” activities of those who buy drugs in Canada. There are incremental ways of introducing genuine free market reforms, but in most cases they are 180 degrees in opposition to what Uncle Milty and his ilk falsely call the free market.

    For example, the right way to privatize government property like universities is via the homesteading principle, as Rothbard described it: treating it as unowned property, and recognizing the students and faculty as its new owners. On the other hand, taking assets paid for with billions of dollars in taxpayer sweat, and auctioning them off for pennies on the dollars to politically connected corporations is faux free marketism.

    Allahu akbar.

  8. milton friedman was worse than hilter!

  9. All this talk about Microsoft’s about-face is sure to coax the Paulina Borsooks out of the woodwork, so that they can beat their dead horse about how awful Silicon Valley’s “Cyberselfish” brand of “libertarianism” is. Let’s head off the inevitable attack on the word “libertarian” at the pass. A real libertarian protests and opposes the competitors’ use of government to gain advantage over him, but by the same token, won’t use government to gain advantage over his competitors. Microsoft, and other high-tech enterprises that say “hands off” unless THEY can benefit, are simply opportunistic hypocrites — there is nothing especially libertarian about their behavior.

    I realize that Sanchez didn’t call Microsoft “libertarian” and, in this instance at least, they don’t appear to have called themselves that. But lefties will use the word, and then go on to use Microsoft as an excuse to trash the word. Just watch. I’ve seen it many times before. If libertarians don’t watch out, that kind of sloppy usage and outright semantic attack will turn “libertarian” into as bad a term of derision and mischaracterization as the once noble “liberal.”

  10. What this really is, is another triumph of anti-trust law. Microsoft acquired that bevy of lobbiests because of the anti-trust suits. Afterwards, as is always the case, the Devil finds work for idle hands.

  11. Microsoft used Cato’s advocacy and research in order to fight a challenge by the government to their quasi-monopoly. So now that they have maintained that position, with Cato’s assistance, they are trying to extend their quasi-monopoly even further by colluding with the government to subvert the very laissez-faire capitalism that they aruged for in the past. Doesn’t this show some flaw in Cato’s thinking? If an unrestrained free market system will lead to the dominant firm’s eventually trying to subvert that system to further their dominance, doesn’t it now make sense that the government wanted to limit their market share in order to preserve a free, competitive marketplace in the long run?

  12. “If an unrestrained free market system will lead to the dominant firm’s eventually trying to subvert that system to further their dominance”

    flaw in your logic, as a free market would eliminate the very means of subversion

  13. To anon @ 10:37AM:

    And where does this perfect free market exist?

    I mean, aside from in the minds of posters in the comment boxes here.

  14. Eric,

    Microsoft’s monopoly power emerged in the first place because of state intervention. Drumroll please:

    1) massive R&D subsidies to the electronics industry during the Cold War, especially for miniaturization;

    2) the government was the main purchaser of the early giant mainframes, without which they would never have sufficient production to reduce costs or develop more efficient computers.

    3) DARPA developed the infrastructure the world-wide web depends on.

    4) state intervention in the free market to enforce Bill Gates’ legal monopoly on Windows operating systems.

    You’re right, Eric, there never has been a true free market. That’s why every society in the damn world is a class society where those on top use the state to milk the producing classes. This is true to the extent that a society deviates from a free market ideal. So we want to push this society as far in the direction of a free market as we can. We want things to get BETTER instead of WORSE.

    So we may indeed be marginalized for taking a stand for something principled, instead of advocating the “free market lite” of Uncle Milty. But all those so-called “free market reforms” are just further state cpitalism packaged as “privatization” or “deregulation.” The devil’s in the details, and those with inside connections decide what the details will be. The only way to get to a free market is to attack the basic structure of corporatism.

    And the only way to have any influence, no matter how marginal, is to actually stand for something in the first place. That means stating our actual positions based on principle, not defining our positions by moving half an inch to libertyward of actually existing capitalism.

  15. Well, Eric, which is it – is our current system an “unrestrained free market system”, or is it one in which politically connected corporations can use the government to bolster their quasi-monopolies. It seems to me that government intervention in support of a quasi-monopoly is a restraint on the free market, so I don’t think you can have it both ways.

  16. The “where does this free market exist” comment reminds me of a story, BTW. A man picked some mushrooms in the woods, cooked them in a rich white sauce, and got deathly sick. So he tried cooking them in brown sauce, and got deathly sick again. He kept picking those mushrooms, and cooking them first one way and then another, and nothing worked. Every time, he got sick as a dog. What do you think the problem could have been?

    Every statist regulation in the past century has served to cartelize the economy to the benefit of corporate interests, at the expense of taxpayer, consumer and worker. But all the proposals for remedying the evils of the corporatist system call for still more state intervention, rather than ending the intervention that created the problems in the first place. For example, rather than ceasing to enforce Big Pharma’s patents, so their monopoly prices would fall by 90%, the pols propose a “prescription drug benefit” to tax workers regressively and buy those medications from Big Pharma at monopoly prices. Real progressive, huh?

  17. lets not forget that the whole linux thing is an excellent example of how antitrust is a myth.this seemingly all powerful, in fact so powerful nothing less than violent attack on its structure by the Feds, enterpirse has gotten market share demolished by a bunch of geeks.

  18. eric: it doesn’t and in never will exist. it is an ideal, a goal, an abstraction, a construct for understanding part of the world to make it better.

    that being said, it is a very rational construct and a worthy goal, though one must understand that the world is not rational and so it is an inherently flawed model (though better than rest when trying to compute the best economic model).

    fundmentalists such as kevin will rail against this forever, bashing his head to the wall against reality or obscuring reality even more with additional abstrations – “state capitalism” – and finally bashing those who deviate from the abstraction in order to apply it to reality (ranting against evil “uncle milty” – milton friedman).

    such as it is with leftists, who worship on the false alter of pure reason.

    personally I like living in the shackles of “state capitalism” better than living in stateless (state-capitalism free!) somalia. yes, there is room for improvement, which something fundementalism will not accomplish anyway.

  19. fyi – The guy above isn’t me!

  20. Spero nos familiares mansuros – I hope we’ll still be friends

  21. Radix lecti – Couch potato

  22. In his ordo est ordinem non servare – In this case the only rule is not obeying any rules

  23. EMAIL: draime2000@yahoo.com
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