They work for half the pay and put 20 people in a 2 bedroom home, send 3/4s of the half pay back home...Makes you wonder what the tax revenue would be if they paid taxes on "Full pay" considering they pay none..This has nothing to due with our workers being greedy!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

I did extensive research on Standard Oil and Rockefeller a year ago for a term paper and found a lot of the wiki to be correct but about a quarter of it was a bit too speculative or rushed/incomplete.

The big part they left out was, as you posted, the vertical monopoly (as the SEC now refers to it) that he developed in order to increase his efficiency. But your post also shows why this has become illegal: by controlling oil from extraction (Standard did, in fact, do very little exploration in comparison) through transport, refining, and delivery, the costs were cut because it was a single entity. Normally, the extractor gets his profit from the refiner who also pays the transport company. the final seller has to pay the refiner's profits.

By keeping as one single entity, there were no middleman profits. unfortunately, this was viewed as an unfair advantage (and in reality really is) because of the scale of operations required for this to take place. Since standard oil was the only company that had this kind of power, they could drive others out of business with lower prices to the public while bringing in a larger income due to lower expenses (that answers the question above - prices were both higher and lower, I just wasn't very clear about it). When other companies had to lower sales prices to compete, many went out of business and then Rockefeller would purchase these companies and roll them into his own, and as your post states, increased their efficiency.

So in reality, Rockefeller did not do so much to increase the efficiency of any one part of the system (other than better management in some cases) but rather combined segments to make the whole system faster.


In all this, I think you misunderstand me (or I'm not being clear) in that I don't see the Standard Oil monopoly as a completely bad thing. I mean, the reason the company grew so much was that the end-consumer got a great price and that killed other companies. The negative is that his methods were very non-competitive. The market at the time was completely open and he took advantage of that until the Sherman Act to create a vertical monopoly and further that into a horizontal monopoly. it never got to the point where it was bad for the consumer, only the others in that market.

What?

Yes, they may not work twice as many hours. However, their productivity (work per dollar) is twice higher. That's the same concept you are using when purchasing anything, it is called "bang for a buck". The only difference in your (and mine) approach is that we usually purchase consumer goods, and the employers purchase labor.

I wouldn't pay twice as much for a domestic product, for example. Or, putting it another way, if a foreign product does the same for half the expense, I am going foreign.



Apparently not so. Otherwise, we would have to conclude that our employers just plain hate Americans. Personally, I don't think so. All other things being equal, they'd still prefer Americans.

I am sorry, Winx, I haven't read your post good enough. I have already posted with regards to pay/time/work, but I have overlooked your argument regarding benefits.

So, what stops Americans from not taking as much benefits either, so that we remain competitive?

i did not even read the post.. is obama REALLY going to help its WAY to soon to tell but what do you think. i live in a state were 35,000 are on unemployment. im going to school to be a nurse thank god. but tell me is this the start of something bad or is obama really the good.. obama is going to prove if the presedent is a puppet or THE MAN

now i read the post ... you know its F**king true people with a billion dollor income ARE STILL IN DEBT thats why they need the mony GREED.. people make ! BILLION a year and still manage to spend it before they have it ... GREED

AndrewAV,

You had me almost agree with you, until you would say things like "unfair advantage" - (what stops other from doing exactly same thing, and conversely, receiving the same advantage?), and "bad for others in the market" (why should consumers care? We do not produce for the sake of production, we produce to serve the needs of consumers, right?).

The concept of competition, being put mildly, is misunderstood, or as I put it, is being hijacked by socialists to find a reason for government intervention.

The purpose of competition to a consumer, it to have the most efficient production of all necessary goods at all times.

Just because there is no competition to a particular producer, in a given point in time, doesn't mean that he is not subjected to a competition. It simply means that he is doing the most efficient production currently feasible. If this producer lowers his efficiency just enough to make even a little arbitrage possible in practical terms, the competition will immediately arise. Thus, provided that the markets are free from the government intervention, he is competing even when there is no competition.

I completely agree that anti-trust legislation was designed to save the consumer and there was no violation to the consumer in that case.

The one thing that prevented others from receiving the same advantage was capital. If someone broke in from (for example) the rail industry with a wealth of capital to invest and could purchase the entire supply chain from extraction on up that would be required to compete, then yes, there is still that competition. The issue is that only a handful of people could pull off a move like that to break into the industry. That is why it is deemed 'unfair': the average business owner stands no chance of competing in a market where another is operating at the brink of efficiency.

So either way, it was an unfair advantage and bad for those other companies in the industry no matter how you look at it but in a word, good for the group that competition is designed to benefit. I personally feel that even though it was unfair to those others in the industry, since Rockefeller and co did not get greedy and ream the end consumer with the power they had, the need for the anti-trust lawsuits were not necessary until they crossed that line.

And ultimately, even in an industry where there is no competition from others and the business owns 100% of the market, the company is in itself competing with itself because it still has to regulate price where the consumer will purchase and their income will meet costs. Too high a price results in less consumer demand and often less income.