Life in the Age of "Monopolistic Capitalism"

Without getting into a long philosophical discussion, most of the world operates under the impression that the USA operates as a society based on Capitalism.

Whether you think that's a good idea, or not, isn't the issue here. The issue is that things aren't always as they appear.

A couple of weeks back, I was listening to an interview/discussion in which the topic of Capitalism in the USA came up, and one of the speakers pointed out that the system largely running the economy is actually monopolistic capitalism.

That is — and this actually confirms something I have been feeling ever since Mrs. Denmarkguy and I started casting about with the idea of moving to a smaller simpler home — many markets in this country are definitely not free, and not governed by demand and supply, in the traditional sense of the concept.

Consider the automobile industry, and the market for automobiles.

It is shocking how expensive it is to buy a new car in the US! Car dealer lots are filled with vehicles costing $50,000 to $100,000... and more.

With the personal economies of likely 90% of the population feeling stretched, there is actually no shortage of demand for an economical small family car.

But the auto manufacturers don't actually want to make them. They want to sell you an SUV, and preferably a luxury SUV, because they make much more money per unit on those, than they would on something like an updated Ford Focus or Ford Escort. No Focus has been made in the USA since 2018.

So if you want an actual new car, you're looking at an Asian import... which is fine, unless tariffs under the incoming Administration make those unaffordable, as well.

How does this relate to my comment about the housing market?

In much a similar way, builders and corporate investors are now "managing" what is available to purchase. Sure, you can go out there and declare that you would like a smaller, solid but basic — without a bunch of "luxury" bells and whistles — dwelling... and you'll quickly discover that builders don't want to build those... even though there are lots of people out there who are looking for just such a thing.

Earlier today, I came across a post on one of our local online bulletin boards... a local person had bought up a property with three acres of land and was planning to build 15 modest homes on the land, with a small plot for each.

Evidently, he had already had dozens of inquiries, within just hours of putting up the post. Every other builder around here has no interest in putting up anything but "luxury" homes.

Both of these are examples of monopolistic capitalism, in the sense that the producers/manufacturers are controlling the market by deliberately only making certain things available to potential buyers.

Of course, part of the problem can be attributed to the fact that many corporate manufacturers are more beholden to investors and bankers than they are to making their actual customers happy.

And that's a pretty toxic situation, when you are on the receiving end of it!

I've been talking about things we might call "major purchases" here, but this trend exists on much smaller levels, as well!

For example, I have noticed it here and there at the supermarket, where a favorite (economy) brand of some product suddenly stops being restocked on the shelves. A few weeks later, the empty slot has been restocked with a "deluxe brand" of a similar product... the inexpensive version has simply been removed from your choices and replaced with a very expensive option.

Things I have noticed disappear in just the past couple of years include my favourite "house brand" cereal ($1.99/box) replaced by some premium national brand at $5.99 a box; pickled cucumbers I really liked ($2.99) replaced by some "craft" brand for $8.99; and a favorite kind of relatively cheap mustard that was simply discontinued... even though the company still exists and still makes the mustard.

Sometimes it feels like the world has gone mad, and such a thing as considering people's actual lives and needs has been forgotten in the eternal quest to increase profits.

It's sad... and — ironically — clashes with what I learned in business at University 40 years ago, where we were taught that production follows demand, rather than producers shaping what people get to demand.

Oh well. Wake up and smell the reality...

Thanks for stopping by, and have a great Sunday!

How about you? Do you ever feel like your choices are being controlled and guided to more expensive options? Does it feel like manipulation? Or is it not an issue in your country/location? Leave a comment if you feel so inclined — share your experiences — be part of the conversation!

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Created at 2024.11.24 00:08 PST
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