OpenMarket: Business and Government

Yesterday, the New York City Council voted to impose a one-year cap on the number of ride-hailing vehicles able to operate in the city. The bills also allowed the city to impose a minimum level of compensation for ride-hailing drivers.

Social media outlets have been filled with commentary this week about the decisions by Apple, Facebook, YouTube, and Spotify to remove content created by talk show host and conspiracy theorist Alex Jones. This is a useful opportunity to clarify what actually counts as “censorship” and what responsibilities that media platforms have to the public.

Of all the consumer products one might have expected to become a flashpoint for political controversy, the humble plastic drinking straw is an unlikely contender. Leap into the headlines it has, though, with communities like Seattle and San Francisco recently enacting bans on disposable straws. The city council of Santa Barbara, California initially voted for a ban that would have punished restaurant workers with up to six months of jail time for giving out a disposable plastic straw, but city officials agreed to revisit the ordinance when it appeared to also ban the sale of straws at supermarkets.

Today, the Competitive Enterprise Institute launches its new video about the platform economy. Platforms are an ancient way of doing business—think of matchmakers, city fairs, and town markets—that bring together two or more parties to make economic transactions. Today, digital platforms allow a far wider reach, bringing together people in a way that was unthinkable just a generation ago.

When I was in Atlanta last month for the Foundation for Economic Education’s annual conference, FEEcon, I heard a lot of messages of optimism from people who were making the world a better place. One of the most inspiring was the short film and in-person remarks offered by Magatte Wade, an entrepreneur from Senegal.

As my colleague Ryan Young says, four percent economic growth is wonderful news. It provides yet more evidence that free-market, supply-side policies work, and that the rising tide of economic growth lifts all boats. There is a risk, however, that some other policies will derail this growth—that’s a risk that responsible free-market politicians should avoid at all costs.

Dominance and popularity are not the same as a coercive monopoly. The European Commission is behaving in protectionist fashion, not in a manner benefitting consumers, and the fines are inappropriate, unwarranted, and plain wrong. Google is no monopoly, as the existence of Apple’s iPhone and other options attest. There is always some new disruptive technology on the horizon (remember the MySpace monopoly? The AOL one?).

T-Mobile and Sprint—the third and fourth largest mobile carriers in the United States, respectively—are in the process of merging into a single company under the T-Mobile brand. Together, T-Mobile–Sprint would have roughly 127 million subscribers, meaning the merged firm would for the first time rival the nations’ two largest wireless companies, Verizon Wireless and AT&T, which have long led the pack among U.S. carriers. 

This week my colleague Ryan Young rightly warned that the White House’s newly announced tariffs on Chinese goods will harm Americans consumers and workers. Simon Lester of the Cato Institute also notes that confusion about the nature of trade deficits is a bipartisan one. This is a good opportunity to get back to basics and remember what tariffs are and how they affect economic behavior and consumer welfare.

Every time a major corporate merger is announced, pundits predictably warn of impending doom if regulators allow it to happen. Yet, pundits and regulators don’t know any better than you or I how a merger will turn out. And unlike investors and entrepreneurs, they don’t have their own money at stake, so they don’t have any incentive to innovate or react to changing conditions.