-Caveat Lector-
~~for educational purposes only~~
Microsoft and liberty
Llewellyn H. Rockwell Jr.
Is free enterprise legal in America or not?
That is the fundamental question raised by
federal judge Thomas Penfield Jackson's
207-page "Findings of Fact" against
Microsoft. Here's a judge who has been
openly biased from the beginning, who
didn't know how to turn on a computer a
couple of years ago, and who even the
New York Times says had to learn about
software as the trial progressed.
This judge, pretending to know more than
hundreds of millions of freely choosing
consumers, now calls Microsoft a
monopoly and demands that it be smashed.
For all the mind-numbing rhetoric, the
invocations of outdated economic models,
and the intricate legalese, there is one
enormous, gaping hole in the judge's
argument: Microsoft committed no crimes
in the normal sense in which that word is
used.
Nowhere does the judge show that
Microsoft committed fraud, stole, coerced,
broke contracts, or threatened anyone or
any company with violence. It didn't take
advantage of any government regulations to
erect legal barriers to its competitors and
it didn't benefit from any subsidies. The
company has not aggressed on anyone's
property or forced any producer or
consumer to pay the company money, to
sign any contract, or to buy its products.
At every stage of its rise to dominance in
the operating-system market, the
consumers and firms it dealt with could
have told Microsoft to get lost. That they
did not demonstrates that they believed it
was to their advantage to work with
Microsoft, which it clearly has been.
Everything Microsoft has done to succeed,
it has done peacefully through exchange
and contract. Strip away all the rhetoric,
then, and what Microsoft stands guilty of is
being a better producer and supplier than
its competitors.
That is the "crime" being punished in
Judge Jackson's mixed-up, upside-down,
inside-out kangaroo court. To make it
appear otherwise, Jackson had to use
rarified meanings of common words in his
"Findings of Fact." Turn to page 46 and we
have Microsoft not freely sharing technical
information with Netscape, which is said
to have "forced" Netscape to delay the
release of a MS-compatible browser.
Now, a regular dictionary says that force
means physical coercion. But Microsoft
did no such thing. It was merely trying to
keep its competitive advantage, and it had
every right to do so.
It gets crazier. On page 86, we find that not
charging for software also amounts to
"force": "Microsoft has forced Windows
98 users uninterested in browsing to carry
software that, while providing them with
no benefits, brings with it all the costs
associated with carrying additional
software on a system." In the same way,
Burger King forces you to take a large
drink with its Value Meal.
Moreover, on page 86, 91, and 93, we
have the great criminal Microsoft "forcing"
consumers to use its browser in order to
get other free stuff from the company.
Surely you know the feeling: you are
"forced" to buy Cheerios in order to get the
free decoder ring inside. Microsoft's crime
is no more or less serious than that.
On page 112, the judge makes a senseless
distinction that is at the heart of the case.
He says Microsoft refused to use the
"power of the market" and instead used its
"market power." But forgetting the strange
use of the word "power," the judge's
distinction is without a difference. The
market is a process that selects firms out
according to their success in providing
consumers with what they want at the
lowest possible price. If the winner falls
down on the job (see, e.g., the whole
history of industry), it will be replaced by
someone who will not. Microsoft did not
want to be replaced, so it worked to compete.
On page 68, we have another listing of a
non-crime crime. "In addition to improving
the quality of Internet Explorer," the judge
says accusingly (!), "Microsoft sought to
increase the product's share of browser
usage by giving it away for free. In many
cases, Microsoft also gave other firms
things of value (at substantial cost to
Microsoft) in exchange for their
commitment to distribute and promote
Internet Explorer, sometimes explicitly at
Navigator's expense."
Horrors! Microsoft improved its product?
Then gave it away for free? It gave others
"things of value"? Even when it cost a lot
to do so? And all in order to beat its
competitors? Welcome to the free
enterprise system. It is because capitalism
rewards such things that we love it. And
here comes the judge to say that this is all
gravely evil. Why? Because this action by
Microsoft "forced" (page 178) Netscape to
release its browser for free. In this man's
twisted logic, free stuff for everyone
amounts to exploitation of the consumer.
Has Microsoft benefited from its
successes? Certainly, but so has everyone
with whom Microsoft has done business.
In the software market, innovation has
never ceased and prices have fallen
continually. If you are using a computer
with software two-years old, you are
hopelessly out of date. You can't even give
away programs and computers that are five
years old. And you can buy a new one --
loaded with programs that would have cost
thousands only a few years ago -- for less
than you paid for your last one.
The miracle of the market has been on
display as never before. Computers are
easier, faster, more powerful, and more
useful. You can download complicated
programs, at no charge, that it took industry
tens of millions to develop. Anyone in the
world can go to Microsoft's site right now
and spend the day downloading virtually
every bit of software essential to opening
up a new world of knowledge,
communication, and efficiency, all without
taking out your credit card.
At every step Microsoft has been the
leader in this demonstration project in
capitalist achievement. It has done so
through entrepreneurial foresight,
astonishing amounts of capital investment,
and a glorious competitive spirit that
strives to serve the consumer better than
anyone else. Consumers of the world unite
and cheer in adulation, not only for what
Microsoft has done, but also for the
free-market system that made it all
possible.
Yes, there is one group that hasn't
benefited from Microsoft's successes. It is
made up of the firms that Microsoft beat in
the competitive process. It is they who
instigated and cheered the government's
lawsuit against Microsoft, and it is they
who will benefit from the break up of the
company. Instead of battling their nemesis
on the open market, they plotted with the
black hats who inhabit dingy government
bureaucracies -- most of which use
outdated technology -- to destroy an
American success story.
Despite its present dominance, Microsoft
has faced enormous competition every day
and every hour of the high-tech boom of
the last decade. Consider the "open
source" movement that is placing its bets
on Linux, an operating system that holds
itself out as a viable alternative to
Microsoft's Windows. Its main enthusiast
has been Eric Raymond, who hates
Microsoft as much as anyone.
But give Raymond credit. He is not for
using the government to advance his pet
interest. As he told Salon: "I want the
market to take down Microsoft, not the
government."
"The whole premise of antitrust law is
wrong," he said. "Governments don't break
up monopolies, markets do. Governments
create monopolies." In his judgment, "there
is more competition for Microsoft now
than there has ever been."
The crux of the intellectual problem for the
government is that it is relying on an
anachronistic and long-refuted model of
economics to bolster its case. The model
is that of "perfect competition," which
posits a never-never land in which trial
and error are not required, there are no
transaction costs of doing business, all
consumers and producers have perfect
knowledge and never change their minds,
there are many firms operating in a given
market though none has a competitive
advantage over any other, and there is no
uncertainty or passage of time.
Judged by this model, the software market
fails. So does every other industry.
According to this standard, any firm that
appears to be a temporary winner in the
competitive process can be deemed a
monopoly. For this reason, Dominick
Armentano, perhaps the leading antitrust
theorist of our time and author of
Antitrust: The Case for Repeal, has said
that this theory has lost all intellectual
credibility. He further says that all
anti-trust laws need to be abolished as
incompatible with free enterprise and
human liberty itself.
Is such an extreme conclusion necessary?
Yes, judging by the way antitrust law is
being used to smear and threaten a great
company with destruction. We must make a
decision between a system in which
dictators in black robes are permitted to
exercise monopoly power over the
workings of our economic system, or fully
embrace the peaceful and voluntary
workings of the market economy that made
Microsoft what it is today. It is the federal
court system that needs to be broken up.
DECLARATION & DISCLAIMER
==========
CTRL is a discussion and informational exchange list. Proselyzting propagandic
screeds are not allowed. Substance—not soapboxing! These are sordid matters
and 'conspiracy theory', with its many half-truths, misdirections and outright
frauds is used politically by different groups with major and minor effects
spread throughout the spectrum of time and thought. That being said, CTRL
gives no endorsement to the validity of posts, and always suggests to readers;
be wary of what you read. CTRL gives no credeence to Holocaust denial and
nazi's need not apply.
Let us please be civil and as always, Caveat Lector.
========================================================================
Archives Available at:
http://home.ease.lsoft.com/archives/CTRL.html
http:[EMAIL PROTECTED]/
========================================================================
To subscribe to Conspiracy Theory Research List[CTRL] send email:
SUBSCRIBE CTRL [to:] [EMAIL PROTECTED]
To UNsubscribe to Conspiracy Theory Research List[CTRL] send email:
SIGNOFF CTRL [to:] [EMAIL PROTECTED]
Om
