To prove that the government is involved in a coercive monopoly with labor unions both private and public, examine the evidence, and the path of behavior which delivered us to the conditions of 2013 where much is made over the size and ambition of virtually any company or financial entity endeavoring to make money. The landmark case of the government against private business establishing the terms of what “the government” considers a financial monopoly can be seen in the United States v. Alcoa case from 1945.
United States v. Alcoa, 148 F.2d 416 (2d Cir. 1945), is a landmark decision concerning United States antitrust law. Judge Learned Hand‘s opinion is notable for its discussion of determining the relevant market for market share analysis and—more importantly—its discussion of the circumstances under which a monopoly is guilty of monopolization under section 2 of the Sherman Antitrust Act.
During the presidency of Franklin D. Roosevelt, the Justice Department charged Alcoa with illegal monopolization and demanded that the company be dissolved. Trial began on June 1, 1938. The trial judge dismissed the case four years later. The government appealed. Two years later in 1944, the Supreme Court announced that it could not assemble a quorum to hear the case so it referred the matter to the U.S. Court of Appeals for the Second Circuit. In the following year, Learned Hand wrote the opinion for the Second Circuit.
Alcoa argued that if it was in fact deemed a monopoly, it acquired that position honestly, through outcompeting other companies through greater efficiencies.
Learned Hand J held that he could consider only the percentage of the market in “virgin aluminum” for which Alcoa accounted. Alcoa had argued that it was in the position of having to compete with scrap. Even if the scrap was aluminum that Alcoa had manufactured in the first instance, it no longer controlled its marketing. But Hand defined the relevant market narrowly in accord with the prosecution’s theory. Hand applied a rule concerning practices that are illegal per se. It did not matter how Alcoa became a monopoly, since its offense was simply to become one. In Hand’s words,
||It was not inevitable that it should always anticipate increases in the demand for ingot and be prepared to supply them. Nothing compelled it to keep doubling and redoubling its capacity before others entered the field. It insists that it never excluded competitors; but we can think of no more effective exclusion than progressively to embrace each new opportunity as it opened, and to face every newcomer with new capacity already geared into a great organization, having the advantage of experience, trade connections and the elite of personnel.
Hand acknowledged the possibility that a monopoly might just happen, without anyone’s having planned for it. If it did, then there would be no wrong, no liability, and no need to remedy the result. But that acknowledgement has generally been seen as an empty one in the context of the rest of the opinion; because of course rivals in a market routinely plan to outdo one another, at the least by increasing efficiency and appealing more effectively to actual and potential customers. If one competitor succeeds through such plans to the extent of 90% of the market, that planning can be described given Hand’s reasoning as the successful and illegal monopolization of the market.
The basics of the case were that Judge Hand decided that Alcoa Aluminum was guilty of operating as a monopoly because their superior manufacturing techniques had deemed them so much better than their competition and they had to be stopped so that other companies could compete. This case set up the history for which much of the modern business landscape has been established for the worse, and is the direct example of “the government” sticking its nose into the business of potential revenue generation to micromanage Alcoa into become less threatening to its competition so that other, less productive companies could gain a helping hand from the government to stay in business. These days we would call this “wealth redistribution,” as wealth and potential profit were stolen from Alcoa through the court system and delivered to its business rivals. Many today have long forgotten about these antitrust laws allowing the government to behave in such a fashion. Most people assume that things have always been as they are now. But the government intrusion attacking capitalism with Karl Marx inspired socialist tendencies began roughly 40 years after the Communist Manifesto was published for the world to read paving the way for that collective based philosophy. In Russia, the communist movement came on the heels of World War I and through the seductive words of Lenin in 1917. In The United States because of the independent nature of the average American, it came subtly through government regulation beginning with the Sherman Antitrust Act in 1890, which was the measure used in the Alcoa case.
Sherman Antitrust Act, basic federal enactment regulating the operations of corporate trusts, passed by the U.S. Congress in July 1890, through the efforts of Senator John Sherman of Ohio. The act declared illegal “every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations.” Criminal penalties were provided for violators of the law, and aggrieved persons were entitled to recover three times the amount of losses suffered as a result of the violation. The Sherman Act has been amended and supplemented by several subsequent enactments. Most notable among these enactments was the Clayton Antitrust Act of 1914. See Monopoly; Trusts.
A few years later with the rise of progressive politics in America following the aggressive behavior of President Teddy Roosevelt, who was born with a silver spoon in his mouth, but never learned to make any real money of his own, progressives applied antitrust laws against “big business.” The Clayton Antitrust Act was passed in 1914. Woodrow Wilson was president at the time and represented the most aggressive push in history where academic intellectuals attempted to gain power through regulation, as their theories could not compete head to head with the titans of industry. So they used the government to perform coercive monopolies against any organization who thought they were too big to bow at the feet of the political class. Wilson and the Roosevelts both Teddy and Franklin a few years later were deeply in love with European politics and were inspired by the works of Karl Marx and used progressive action by government to further strengthen the Sherman Act.
Clayton Antitrust Act, legislation passed by the Congress of the United States in 1914 to prohibit certain monopolistic practices that were then common in finance, industry, and trade (see Monopoly). Sponsored by Alabama congressman Henry De Lamar Clayton, the Clayton Antitrust Act was adopted as an amendment to the Sherman Antitrust Act. Designed to deal with new monopolistic practices, the act contained provisions covering corporate activities, remedies for reform, and labor disputes. Unfavorable court interpretations weakened the act, however, and additional legislation was required finally to carry out its aims.
Fair Trade Laws, in commerce, legislation permitting manufacturers to set minimum resale prices for their branded products sold by retailers to consumers. The proliferation of chain stores prompted attempts to introduce such legislation in the 1920s to prevent the price-cutting policies characteristic of the chains, but passage of regulatory state laws did not occur until California led the way in 1931. By the 1940s all but three states had enacted fair trade laws governing intrastate transactions. Although the Sherman Antitrust Act prohibited all price-fixing agreements in or affecting interstate commerce, it was amended by the Miller-Tydings Act of 1937. This new act permitted resale price maintenance agreements on trademarked commodities sold in interstate commerce in states where contracts between manufacturers or wholesalers and retailers were sanctioned by state legislation. A 1951 Supreme Court ruling released all merchants who had not signed such contracts from the requirements of this act. The McGuire Act, passed by Congress in 1952 , reestablished the requirement that nonsigners abide by the same terms as signers of contracts. Although subsequent Supreme Court rulings upheld price fixing, the laws were challenged in state courts and enforcement became increasing difficult. In 1975 President Gerald Ford signed in law an act repealing the Miller-Tydings and McGuire acts, again making all resale price-fixing agreements affecting interstate commerce a violation of federal antitrust laws. Most states subsequently repealed their fair trade laws.
This of course brings us to the modern age where companies terrified of being accused of a monopoly status must send lobbyists to Washington to pad the pockets of politicians with riches hoping to avoid the dreadful designations and court proceedings which can come out of an antitrust case. Now, before anyone states that the events so far discussed are “ancient history” and not relevant to the modern age, let us examine the most recent example of government trust busting where it used The Justice Department to prosecute Microsoft for being too big using the Sherman Act to do so.
United States v. Microsoft Corporation 253 F.3d 34 (2001) is a US antitrust law case, ultimately settled by the Department of Justice, where Microsoft Corporation was accused of becoming a monopoly and engaging in abusive practices contrary to the Sherman Antitrust Act 1890 sections 1 and 2. It was initiated on May 18, 1998 by the United States Department of Justice (DOJ) and 20 states.Joel I. Klein was the lead prosecutor.
The plaintiffs alleged that Microsoft abused monopoly power on Intel-based personal computers in its handling of operating systemsales and web browser sales. The issue central to the case was whether Microsoft was allowed to bundle its flagship Internet Explorer(IE) web browser software with its Microsoft Windows operating system. Bundling them together is alleged to have been responsible for Microsoft’s victory in the browser wars as every Windows user had a copy of Internet Explorer. It was further alleged that this restricted the market for competing web browsers (such as Netscape Navigator or Opera) that were slow to download over a modem or had to be purchased at a store. Underlying these disputes were questions over whether Microsoft altered or manipulated its application programming interfaces (APIs) to favor Internet Explorer over third party web browsers, Microsoft’s conduct in forming restrictive licensing agreements with original equipment manufacturers (OEMs), and Microsoft’s intent in its course of conduct.
Microsoft stated that the merging of Microsoft Windows and Internet Explorer was the result of innovation and competition, that the two were now the same product and were inextricably linked together and that consumers were now getting all the benefits of IE for free. Those who opposed Microsoft’s position countered that the browser was still a distinct and separate product which did not need to be tied to the operating system, since a separate version of Internet Explorer was available for Mac OS. They also asserted that IE was not really free because its development and marketing costs may have kept the price of Windows higher than it might otherwise have been. The case was tried before Judge Thomas Penfield Jackson in the United States District Court for the District of Columbia. The DOJ was initially represented by David Boies.
It can be argued that Microsoft has never been the same company since that case. A few years later, Bill Gates retired to philanthropy to become a guilt ridden ex-capitalist attempting to further expand the government education empire of which he rejected as a youth to wash away the sins exposed by the government prosecuting him for his lack of business altruism. Microsoft prior to that case did not effectively use lobbyists in Washington to pay off the trolls of legislation, which is something they remedied after that case and many companies followed. The message to business in America was that if a company decided that it wanted to corner the market through competitive superiority, then they would be punished—unless however a company sent representatives to K-Street to grease the wheels of politics away from prying eyes.
The government established itself as a crusader for “the people” in an attempt to create a “fair” business environment, as defined by socialists, communists, progressives, and other Karl Marx fans. Yet their attention only gazes in one direction—toward money making enterprises. They ignore however the antitrust of the labor unions who hijack business labor, especially in the public sector with excessively aggressive examples of coercive monopoly. Unions avoid the ridicule because the antitrust laws have been designated toward the bourgeoisie producers of products to use Karl Marx’s term and ignores the actions of labor which is inserted as a competitor within any organization dealing with labor unions. This action is most evident in the public sector unions of education where their behavior prevents competition, deliberately drives up the wage rates outside of market parameters, and is the grossest modern example of a coercive monopoly. As defined by the government in their cases against Alcoa back in 1945 and Microsoft in 1998, teacher unions and education institutions in general are the absolute worst forms of coercive monopoly in existence. Based on their behavior, they may be the worst to ever exist in the history of the world. Education unions steal tax money by striking, preventing competition through force, protest, and lobbying having a sole purpose of maintaining a labor monopoly by excluding entry into their markets with “force.” In this way, modern unions are far, far worse than Alcoa ever was as a monopoly power, or Microsoft ever came to be, yet no politician thinks to attempt prosecution against the labor unions in a way that Senator John Sherman of Ohio did back in 1890 toward business or Henry De Lamar Clayton did in 1914. But why?
We have seen in Ohio and Wisconsin what happens when legislators attempt to apply such rules to unions; the unions use their coercive monopoly to apply physical harm to legislators who attempt to designate their actions in such a fashion. CLICK HERE FOR AN OBVIOUS EXAMPLE BY THE SEIU IN OHIO. Businesses like Alcoa and Microsoft didn’t act in such a fashion. That is why they were picked on by the government. Government like the labor unions of which both are products of socialism, achieve their goals trough coercive monopolies and they use their power, and desire to use force to extort from those too placid to fight back. In the case of businesses like Alcoa and Microsoft, they were producers who have everything to lose; the government has nothing to lose since its sole function is to steal from others to fill itself. In a conflict, this gives the government the upper hand. This is the cause of the lobby influence in Washington to this day. The goal of the lobbyists is to keep the government in their offices and away from prosecution using the Sherman Act to attack their companies with antitrust violations. Yet the same doesn’t work the other way as it should. Legislators fear applying the same antitrust terminology to a firefighter union, a police force, or any of the teacher unions even though they engage in exactly or worse antitrust violations than have ever occurred—anywhere, because the unions operate through fear, intimidation, and extortion. Legislators instead of confronting them, attack people like Bill Gates, a computer geek who became wealthy inventing the computer industry from his garage as a college dropout. No threat there. Or they attack Alcoa for simply being too good at their business.
The hypocrisy is obvious, and demands serious analysis. Labor unions in The United States are parasitic entities that only exist through coercive monopoly status. They are the cause of continuous tax increases and unmanaged local budgets. They don’t get paid based on the quality of their work, but from the fear they inspire into the political machine. They, unlike Microsoft or Alcoa are not the best in their fields of endeavor, they are simply willing to use force to achieve their desires—and that means they should be prosecuted to the furthest extent of the law with the same gusto that The Sherman Act was created and for the same reasons. The only reason they are not is because legislators are afraid to put such words into the public for fear that they will be examined by history for taking away the “rights” of such people. What those politicians don’t know because they lack a study of history is that such rights do not exist—except in the mind of Karl Marx, where the labor unions were born using tactics that have built the worst coercive monopolies in the history of mankind—all on the backs of the American taxpayer, while the innocent are hung like thieves by the murderers of capitalism—labor unions and their government conspirators with their coercive monopoly which involves the legal system.
Encarta® 98 Desk Encyclopedia © & 1996-97 Microsoft Corporation.
All rights reserved.
Encarta® 98 Desk Encyclopedia © & 1996-97 Microsoft Corporation.
All rights reserved.