Archive for January 10th, 2022

Biden: “Lack of competition is exploitation”

January 10, 2022

Does the principle apply to education too, Joe … or just “big meat”?
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This week, Biden lashed out at “big meat” … blaming his policy-induced inflation on greedy meat purveyors … and flag-poling a broad theme: “Capitalism without competition is exploitation”.

As an academically-degreed economist, I agree that a condition for “perfectly efficient markets” is the presence of numerous direct and indirect competitors and product substitutes.

But, I think industry concentration is a lame excuse for the current skyrocketing inflation.

Industry consolidation hasn’t changed materially over the past, say, 5 years … and inflation was minimal in the 4 years preceding 2021.

That suggests that there are “root causes” other than industry concentration.

Catch my drift?

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My question:

Isn’t Biden’s condition for “market efficiency” generalizable to, say, education?

Even the NY Times concedes that “Many schools have still not returned to normal, worsening learning loss and social isolation.”

Why is it that many schools have not returned to in-person learning?

Simple explanation: Urban teachers’ unions in several cities are continuing to use their collective (and concentrated) clout to stiff-arm in-person classes.

Besides the well-publicized Chicago bruhaha, “closings are taking place in Atlanta, Cleveland, Milwaukee, Newark and several New York City suburbs, among other places.” NYT

The unions collective and concentrated actions are also a violation of economists’ “efficient markets” criteria” … causing havoc.

So, it seems logically consistent in principle to declare:

“Education without competition is exploitation”

President Biden may have inadvertently handed school choice advocates a resonating rallying cry for the 2022 mid-term elections.

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P.S. For an analysis of the real root causes of meat price increases, see WSJ: Meatpackers Are Biden’s Latest Inflation Scapegoat


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