Understanding Microsoft

Part 6. The Marxist

Question: When is a capitalist not a capitalist?
Answer: When he is a monopolist.

Some of the most common misconceptions and errors of our times have to do with simple, basic definitions of everyday terms. For example, any form of business is wrongly called Capitalism, since it involves Capital (money). The idea that the term Capitalist applies to any business, no matter how large it gets, no matter what it does to make its money, is a fallacy.

One example of this error is when the business is Mafia-controlled. A South American drug cartel is not an example of capitalism in action, is it? Remember, capitalism involves a free market making choices among several competitors, based on price, quality, convenience, and other such factors. Capitalism also implies that the products for sale are legal and safe. Criminal activities fail the test, because the essence of criminal competition is direct attacks on the competition, not simply providing a better product. Any form of cartel (even of legal goods or services) is not truly capitalistic; it is merely a shared monopoly.

The defining difference between a controlled economy (such as socialism or communism) versus capitalism has to do with several questions, but the most obvious one is this: Who decides winners and losers in the marketplace? If a government dictates what is bought and sold, this is not capitalism. However, if a single company has monopoly power and dictates what is bought and sold, is this not also a case of a controlled economy, masquerading as capitalism? When a company begins deciding who can or cannot enter a market, and which products can or cannot be sold in a market, this company is making a bid to become a government instead of a business. This is Corporate Marxism, where the dictatorship of the proletariat has been replaced by the dictatorship of the monopolist. The monopoly sees itself as supra-governmental, above the law, and therefore seeks to usurp government as the source of the centrally-planned economy.

Nowhere is this more true than in the computer industry. Any company wishing to enter the marketplace for software must take into consideration what monopolist Microsoft will do in reaction. If Microsoft says No, Microsoft has the power to enforce that decision by altering the operating system. This is as if Microsoft can pass a law -- like a Politburo would -- that specifically bans a certain company from the marketplace. Microsoft thus assumes the role of deciding winners and losers in the software marketplace. They have taken business to a new level of authority, a level that approximates Stalinesque dominance.

If Microsoft determines that a competitor will likely occupy a dominant position in a certain sub-market (such as Internet browsers), they will do one of three things:
1. Attempt to buy the company, then flood the market with the product to kill competition.
2. Buy a competitor's low-quality product, then flood the market to destroy the superior competitor.
3. Develop a low-quality equivalent product in-house, then flood the market to destroy the superior competitor.

In each of these situations, Microsoft decides what people will buy, not the free market. The consumer is reduced to nothing more than an information serf, who takes what the Meister doles out. There are some people who actually like this sort of thing, but for them to brag that this is "capitalism's finest hour" is hypocrisy.

Most recent revision: March 1, 1998
Copyright © 1997,1998, Tom Nadeau
All Rights Reserved.