Monopolies are bad! This is what I've learned my whole life. The Trustbusters are heros! Anti-Trust legislation protects us from evil monopolists, who are the antithesis of capitalisim, and singlehandedly destroy market efficieny. Good thing we have the government, as they protect us from them.

These are all things I believed, at least until I was 16 or so. But now I've realized that plenty of Monopolies are government created. Copyrights and patents, as we've talked about, are government created monopolies. But my new favorite government monopoly is the monopoly on printing money.

The gold standard is long dead, and currently the whole world works on a fiat monetary system. By some appearances this has had a lot of benefits - the buisness cycle has been more stable, and we haven't seen depression-type collapses (which had happened somewhat regularly before that, if at a lesser scale than the 30's). But there are other structural changes, such as to the banking system itself, that can probably carry as much credit as any fiat system. But the fiat system does guarantee governments a monopoly on money, one they admittedly had before that but not for the whole history of the country.

The fiat system, while working semi-acceptably here, do not serve the people, they serve the governments. Especially when the government has control over the printing of new money. Got debt? Print more cash. Oh, I'm sorry, "increase the money supply". It's free taxation. More money in circulation, everyone elses devalues. You're the government, you put the new money in your pocket. Its like you just taxed the people the difference between the old and new values of their money. Sound impossible? Look at South America.

I'm not going to propose any kinds of solutions to this here, or even say for sure it's a problem. There is still competition in money; China is causing problems because they refuse to change their exchange rate. But its all between governments, and is monopolistic per state.

Basically, the message I've gotten from the government is Monopolies are bad unless they don't understand it (Microsoft), control it themselves (money), or grant it (copyrights). The government is not, unfortunately, any kind of friend of capitalisim or the free market. While this is not the best example of their anti-market practices, I believe it counts as at least one. I can list off piles of them later.



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