I periodically end up arguing with someone about monopolies and whether they are an issue. My position is that monopolies happen, that they are not necessarily good for consumers, but that they don't last unless they are enforced by the government. Monopolies don't last because they can't last. A company that has a lock on some service and who abuses that power, will be challenged by another entrepreneur. Example, you are the only telephone company on the block. You charge outrageous amounts of money for poor service. What will naturally happen, assuming that people really want or need telephone service, is that someone will offer an alternative with better service at a lower price. That service may be a different company offering the same service, it may be internet based like Skype, it may be a cell phone, or it may be some option that no one has invented yet, but the black rotary dial phone that hangs in the kitchen will be replaced if it doesn't meet your needs. Monopolies do not last unless the service being provided is not in particularly high demand or unless the government props up that monopoly.
So when is a monopoly apparently OK? To answer this question let me give you an anecdote about my garbage service.
Right before I went on vacation my garbage was not picked up. I figured that I hadn't got it out in time that morning, so I wheeled the bin back in and left on vacation. It would go out the next week and I wouldn't be adding garbage, so no big deal.
In my mail when I get back is my bill. The bill includes a late charge for not paying my bill on time, a "restart" charge for restarting my service (indicating that it was cancelled), and a variety of pro-rated stuff, the net result of which is that I am paying more this bill than I normally pay, even though they presumably didn't pick up my garbage for two or three weeks.
When I call the company to discuss, among other things, the fact that my payment took two weeks to be processed from the date I sent it, I get told that my check is being sent to the wrong address and then forwarded to their payment center. I asked why I wasn't notified that the address had changed they claimed that they had notified all their customers but that it had been "several years" since the change. So for several years they have been receiving my payment at the wrong address and it never occurred to anyone to contact me and let me know that they had changed. That's issue one.
Two, our bills only come out every three months. When I get bills I put them in my Bill Folder and at the beginning of each month I pay anything that is in the folder. They claim that the bill was due in May, which means that I should have received it in April or May, which means that it should have been paid in May or June. I didn't pay it til July. Not sure why, OK, maybe my mistake. Question: Any reason that I wouldn't have gotten a notification that my bill was past due at some point in the interim between when the bill was due and when my service was cancelled? The woman claimed that I had been sent a past due notice (Nope) and that I had been called twice and that messages were left both times. That is an outright lie. There has not been one single message on my cell phone about my bill. When I pointed this out the woman at the company didn't really seem to care. Not her problem.
So why is it not her problem? I don't have an alternative for garbage service other than keeping piles of stinking garbage at my house and periodically driving to the dump to get rid of it. The dump is about twenty minutes away so by the time you add in an hour of my time plus having piles of stinking garbage sitting around, it really isn't worth the hassle and the effort. The garbage company is a monopoly created and maintained by the local government. No other company is legally allowed to provide garbage service in our town.
So why is a monopoly OK when the government decides to impose one but not OK when a private company buys up their biggest competitor? Well, probably because it's government and they are there for us, not like the evil nasty capitalist corporations.
That is piss poor customer service and it is maintained by a government which, for the past hundred years or so, has spent billions if not trillions of tax payer dollars ensuring that we don't receive the piss poor service that allegedly goes along with monopolies.
This is why I am a libertarian. Governments do things like preventing the free market from resulting in monopolies (to keep you safe) while simultaneously creating monopolies any time they please. Governments have the power of force, the power of violence, to keep you from buying up your competitors, even if it is the most efficient way to do business, and the power of force to keep anyone else from providing garbage, cable, or electricity to my house. In a free market if there were other companies who promised better service at a reasonable price I could check them out. Maybe I would stick with my current company. Who knows? They've actually provided pretty decent service for the most part but I have no option anyway and they know it, so there is no incentive to make sure, for example, that I am actually told that my bill hasn't been paid, even though I am a sixteen year customer with no history of delinquency.
But, it's a government created monopoly. They are the only game in town so what can you do? Nothing, that's what.
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