Monopoly Pricing

In this first story Spacex (provider of space flights) decides to partner with Bigelow (potential maker of a private space station). This of course means less competition in space and thus lesser incentives to improve technologies and pricing.

But this first step toward a merger doesn’t worry me nearly as much as this next story. It’s the American Congress’s idea to go with only one company for America’s space needs. One company. Does Congress know nothing about private enterprise?

I bet they’ve been believing the lie that free enterprise is always more efficient than government. This is only true if there are a number of companies to compete with.

Sure there is some redundancy amongst the different free enterprise companies. One company can solve this problem by eliminating this waste spending.

But with no one to compete with, the savings will go directly into the shareholders pockets. After a little while, the lone company will start monopoly pricing. Which, if previous monopolies are any indication, will be more expensive than even the government cost when they were running things.

You don’t get cost savings with monopolies. The four companies that NASA is playing off against each other, just might be a strategy that works. Maybe Americans don’t know how bad one or two companies controlling a whole industry is because there are usually many more companies in the large American market.

Canada is a much smaller market so the government sometimes has to legislate more competition. At other times, Canada has allowed monopolies but only with an arm of government set up as a watch dog that can set prices so the monopoly doesn’t gouge consumers.

Shame on the American Congress. I wonder who is buying them out. Or which lobbyist is so silver tongued they got the politicians to believe their lies. NASA has the right idea.

The only joke in this post is American Congress. And I’m not laughing.

About Larry Russwurm

Just another ranter on the Internet
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