business, politics, technology

Where is Capitalism Anyway

There’s a hard case for saying capitalism still exists in America. Calling our market a free one is like saying a cage-free chicken is honestly free. The irony is that it is the market leaders (often ones who clamor for deregulation) are the ones that are steering America’s market towards a feudal system.

The linchpin in this drive is patents & copyrights and to a lesser degree trademarks. Patents & Copyright aren’t necessarily bad, but they are being heavily abused in the US. It only takes one look at Marshal, Texas to understand where we are heading.

While small businesses and start-ups are hurt, the folks sitting at the end of the punch are the America people. The state of intellectual property laws are such that we’ve stifled innovation in America and reduced competition. The concept of the free market is that those who can’t survive in business are pushed out of the market, however through intellectual property management any company that has established itself can remain on artificial life-support by abusing the system through lawsuits that either give failing businesses a cut of their competition’s income or by blocking that competition altogether.

The result is that old weak companies wheeze along while newer innovative companies are left emaciated or quietly strangled out of existence through a feudal market. A feudal market is one in which companies survive only through virtue of their heritage (intellectual property). If a new innovative company enters the market it must pay the old company to work on the land (license fees) or it can not work at all.

Companies have learned this and have begun hoarding patents. These patents abused to the detriment of America. The long-term result of a feudal business model is that innovative products will cost more and come from other countries. While the old companies flail in their slow death they are taking the economy with them. And while their death is slow it will not be nearly as painful for them as it will be for middle and low class Americans.

The life-span of companies has been artificially prolonged leaving us with undead monsters who scour the market for the brains of the living. There is always a balance, the dead trees fall down and decompose, feeding the young trees as the stretch upward, the question is where those trees will be. Will innovation be able to survive in America or will it find more fertile soil elsewhere? And consider this, sometimes the old dead trees don’t fall down and decompose, sometimes they pile up— the only thing for that is a fire, but fire destroys everything and it takes years for a new forest to grow in its place. Do we really want to wait for the fire?

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