Home » competition

Are You Ready for the Next Industry Uber Innovates?

in From Me To You, Liberator Online by Brett Bittner Comments are off

This article was featured in our weekly newsletter, the Liberator Online. To receive it in your inbox, sign up here.

I am proud to admit that I am a HUGE fan of Uber.

uberWhen I travel, I use it almost exclusively for transportation. A few mornings a week, I even Uber to work to get ahead of the workday by knocking out a few e-mails or phone calls before my first trip to the refrigerator for a refreshing beverage (I don’t drink coffee). I Ubered to work this morning, because I knew that those few minutes I save result in greater productivity on the busiest day of the workweek around here.

When the story of the end to their experimentation with a courier-like service to become a full-featured delivery business model became widely shared yesterday, we saw the next innovation in the “sharing economy.” This change joins Amazon and Google in the instant gratification game. As a member of Amazon Prime (and more importantly, Prime Now) and Google Express, I enjoy near immediate delivery of many items to my office or my home that would otherwise require a trip to a grocery or big-box retail store.

After offering a free market alternative to taxis and buses and introducing the areas they serve to the “sharing economy,” Uber sought to grow into the logistics market. While not what they envisioned at the start, Uber’s experiment may result in providing small businesses, like restaurants and boutiques to offer same-day delivery without the overhead and development of a local logistics program.

What I found to be bigger news than their introduction of these services in New York, San Francisco, and Chicago, is that the demand for the service changed their implementation of the new business. The market demanded that the simple courier service they envisioned morph and adapt to accommodate the business side of a transaction, rather than compete directly with delivery services. The original offer is still available, though expanding to be a partner with the small business looking to meet their needs will likely be the driving force of their entrance into the delivery market.

Isn’t it great to have competition and cooperation to meet the customers’ needs, even if those needs didn’t match the beginning hypothesis?

Two Phrases That Unmask Crony Capitalism and Corporate Welfare

in Communicating Liberty, Liberator Online by Sharon Harris Comments are off

(From the One-Minute Liberty Tip section in Volume 20, No. 12 of the Liberator Online. Subscribe here!)

Chris Rufer is founder of The Morning Star Company, which employs approximately 2,500 people in food processing and agribusiness. He’s also an Advocates Board member.

Last week Chris had an excellent opinion piece published in the New York Times, explaining why the federally run Export-Import Bank is a rip-off and boondoggle that should be shut down.

The article is entitled “End This Corporate Welfare.” There’s a brief excerpt from it in this issue’s They Said It column, and you can read the full article here.

Chris does a great job of making this seemingly obscure and esoteric issue clear, interesting and important to the average reader.

One phrase in particular jumped out at me. Describing how corporate welfare works, Chris writes: “It’s private gain at the expense of public pain.”

That’s a great phrase! I love the populist feel of it, and how it makes the injustice of such things as the Export-Import Bank instantly clear. “Private gain at the expense of public pain” can be used to describe all kinds of corporate welfare and crony capitalism boondoggles: professional sports subsidies, licensing laws that protect politically connected businesses from competition, taxes on imported goods… and many more.

I also like another phrase Chris used. He notes that the Import-Export Bank gives huge private businesses taxpayer-backed loans, guarantees and insurance.

The results: “When a company profits from the bank’s support, it pockets the money. If it defaults, taxpayers’ pockets get picked.”

That, too, is a clever and catchy way to describe the essential unfairness of corporate welfare, how it protects politically connected companies from the risks and consequences of their actions — at the expense of the rest of us.

Consider adding these two phrases to your liberty communication vocabulary.

Word Choices: Pro-Market, Not Pro-Business

in Communicating Liberty, Liberator Online, Libertarian Stances on Issues, Libertarianism by Sharon Harris Comments are off

(From the One-Minute Liberty Tip section in Volume 19, No. 9 of the Liberator Online. Subscribe here!)

Libertarians enormously appreciate the positive contributions so many businesses have made to our


Because of this, libertarians are sometimes labeled “pro-business.”

But this is incorrect — and misleading.

Libertarians are not “pro-business.” We are “pro-market” — a very different thing.

The distinction is a vital one.

Libertarians support a free market where businesses are free to enter a field and offer their goods and services, in competition with any and all others who wish to do the same.

The resulting competition brings ever-better goods and services. Lower prices. Innovation. More convenience and more choice.

The companies that succeed in this free market competition do so by doing the best job of pleasing customers. Those that fail to sufficiently please consumers go out of business. The consumer is king.

This is the market process that libertarians strongly support.

But being “pro-business” is an entirely different thing. Politicians, lobbyists, economists, pundits and others who are pro-business — or who favor a particular business entity — may lobby for special favors for a particular business or area of commerce.

This may be pro-business. But it is anti-market.

Many who are pro-business want government to help particular businesses or industries that are unable to compete effectively. Sometimes they want government to use political power and tax dollars to entice a business to locate in a particular area.

Pro-business forces may want to prop up a favored business with bailouts of tax dollars or with other tax grants. They often call for punitive taxes on competition that challenges the favored business (especially if that competition is foreign). They may offer special zoning privileges to favored businesses. They may call on the government to seize private property through eminent domain and give it to a favored business.

Pro-business forces may endorse licensing, education requirements, regulations and other obstacles that protect favored businesses from competition. It often surprises people to learn that many large businesses love government regulation because it limits their competition. But as Nobel Prize winning economist George Stigler wrote: “…as a rule, regulation is acquired by the industry and is designed and operated primarily for its benefit.”

Governments may declare a business is “too big to fail” and thus deserves a huge taxpayer bailout. Or that a field is crucial to the “public interest,” and thus deserving of subsidies and special treatment; agriculture is a prime example.

You get the picture. All of this is done by pro-business people. And all of it is deeply, profoundly, anti-market.

In an excellent article on this topic, “‘Free Market’ Doesn’t Mean ‘Pro-Business“ economist Art Carden quotes a great passage from the book The Rational Optimist by Matt Ridley:

“I hold no brief for large corporations, whose inefficiencies, complacencies, and anti-competitive tendencies often drive me as crazy as the next man. Like Milton Friedman, I notice that ‘business corporations in general are not defenders of free enterprise. On the contrary, they are one of the chief sources of danger.’ They are addicted to corporate welfare, they love regulations that erect barriers to entry to their small competitors, they yearn for monopoly and they grow flabby and inefficient with age.”

The fruits of the pro-business mindset — taxes, unfairness, lack of competition and choice, over-priced goods and services, unemployment — are often the things that people hate most about our economic system. People naturally blame this on free enterprise, on the market system. Yet it is the pro-business mindset — not the market — that is responsible for these ills.

Let me give Art Carden the (almost) final word:

“In a free market, you are welcome, and indeed encouraged, to enter the mousetrap industry if you think you can build a better mousetrap or find a way to make similar mousetraps more efficiently. The other side of that coin is that you will be encouraged to leave the mousetrap industry if it turns out that your mousetraps are not better, but inferior.

“A ‘free market’ agenda is not the same thing as a ‘pro business’ agenda. Businesses should not be protected from competition, losses, and bankruptcy when they fail to deliver for the customer. All three are essential to truly free markets and free enterprise.”

Don’t use the label “pro-business.” And politely but firmly reject it if someone attempts to label you that way. Respond that you are pro-market, not pro-business. And explain the difference.

FREE Libertarian E-Book: The Morality of Capitalism

in Economic Liberty, Liberator Online by James W. Harris Comments are off

(From the Intellectual Ammunition section in Volume 19, No. 4 of the Liberator Online. Subscribe here!)

In recent issues we’ve reviewed and recommended two outstanding free e-books available through Students For Liberty (SFL): After the Welfare State and Why Liberty.

Now we’re pleased to suggest one more great SFL title to add to your ebook library.

The Morality of Capitalism: What Your Professors Won’t Tell You combines the writings of renowned economists, philosophers, historians, policy experts, and entrepreneurs from around the world to make the case that not only do free markets “deliver the goods,” but that true free market capitalism is a just and moral system.

It is clear and highly readable, suitable for students and non-students alike, for newcomers to free enterprise and libertarianism as well as longtime libertarians.

As SFL notes:

“As students for liberty, we are well-versed in defending the free market. Our opponents on campus constantly claim that markets are unfair, that capitalism is exploitative, that competition is inhumane, and that government control and redistribution are the solution to society’s problems. Every day we struggle to explain that a free society that embraces free exchange is the only way to create wealth, peace, and prosperity for all.

“Most people acknowledge, if only begrudgingly, that capitalism does produce considerable wealth and material well-being. But many feel torn between material prosperity on the one hand and living a moral life on the other. The self-interested pursuit of profit that is characteristic of a capitalistic system just doesn’t feel right to them.

“The task before us, then — if we wish to actualize the truly free social system that is laissez-faire capitalism — is to provide and defend its moral justification. We must convince fellow students that capitalism is not just the most efficient system, but a virtuous one as well.”

The Morality of Capitalism: What Your Professors Won’t Tell You makes that case, powerfully and convincingly.

Students For Liberty has distributed over 100,000 copies to students around the world since it was first made available.

You can learn more about The Morality of Capitalism: What Your Professors Won’t Tell here.

Download it as a FREE PDF ebook here.

Here’s the table of contents: 

Introduction: The Morality of Capitalism by Tom G. Palmer
The History of a Word
Free-Market Capitalism vs. Crony Capitalism

Section I: The Virtues of Entrepreneurial Capitalism

  • Interview with an Entrepreneur featuring John Mackey (Whole Foods CEO)
  • Liberty and Dignity Explain the Modern World by Deirdre N. McCloskey
  • Competition and Cooperation by David Boaz
  • For-Profit Medicine and the Compassion Motive by Tom G. Palmer

Section II: Voluntary Interaction and Self-Interest

  • The Paradox of Morality by Mao Yushi (Translated by Jude Blanchette)
  • The Moral Logic of Equality and Inequality in Market Society by Leonid V. Nikonov
  • Adam Smith and the Myth of Greed by Tom G. Palmer
  • Ayn Rand and Capitalism: The Moral Revolution by David Kelley

Section III: The Production and Distribution of Wealth

  • The Market Economy and the Distribution of Wealth by Ludwig Lachmann
  • Political and Economic Freedoms Together Spawn Humanity’s Miracles by Temba A. Nolutshungu

Section IV: Globalizing Capitalism

  • Global Capitalism and Justice by June Arunga
  • Human Betterment through Globalization by Vernon Smith
  • The Culture of Liberty by Mario Vargas Llosa
  • A Little Further Reading for Fun and Profit (and Better School Papers) by Tom G. Palmer

The Morality of Capitalism: What Your Professors Won’t Tell You is published by SFL and the Atlas Network. We highly recommend it.

Student groups note: SFL offers a limited number of hard copies at no cost to student groups. You can learn more about that here.