Use Cash

I think I posted the January NY Times article about the card monopoly… Maybe not. Either way, use cash.

-thm

Columbia Journalism Review, June 21st, 2010
“Rock-Jawed Titans of Industry Don’t Really Like Free Markets”
As Kevin Drum says, they prefer monopolies like the ones Visa and MasterCard enjoy
By Ryan Chittum

Kevin Drum, in dismissing Matt Ygeslias’s qualms about over-regulating the credit and debit card industry, touches on an excellent point here:

Unfortunately, as economists since Adam Smith have pointed out, most of our rock-jawed titans of industry don’t really like free markets. They much prefer cozy cartels and opaque pricing, which are far more profitable.

Indeed. The ultimate goal for any capitalist worth his pinstripes is not to compete in a free market, it’s to get control over a market. Merge. Acquire. Consolidate. Squeeze. Fewer competitors means less competition. If that seems like an overly obvious statement, it’s all too often lost on politicians and regulators. Sure monopolists can get fat and lazy and eventually be undercut by some scrappy, inventive upstart (hello, Microsoft!). But that can take decades, and in the meantime we’ve all been paying more than we should have. That’s the point of antitrust laws, properly enforced.

Visa and MasterCard between them have cornered 96 percent of the debit- and credit-card market worldwide (79 percent in the U.S.). Visa alone has 68 percent.

read more