America's Antitrust Legislation and the New Global Economy

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America's Antitrust Legislation and the New Global Economy

John Kenneth Galbraith in The New Industrial State argued that U.S. anti-

trust legislation is a result of outdated arguments about the need to preserve “free

enterprise” and the competitive market. Galbraith stated, that large corporations in

modern economies may need to limit competition in order to achieve efficiency and

compete with foreign imports in the new global economy.

I agree with this statement. When a corporation becomes big and starts

to grow and expand they will soon gain control of their market. Once a company has

gained control of their market, within their nation, they can focus their attention on

competing in the global market for their product. More effort can now be directed

towards, achieving efficiency, and the improvement of their particular product. And

since their only competition is foreign competition they can spend less money on

advertising and other cost consuming practices of competition.

A monopoly is a market situation in which there is only one seller of a

particular good or service. When companies exercise monopoly power they act as if they

were monopolies. Government regulation of big business/monopoly power arose because

of the following accusations: monopolies raise prices, monopolies reduce output and

living standards, monopolies are inefficient and wasteful, monopolies are intensive to

consumer demand, monopolies engage in unfair competition, monopolies help bring on

recessions and they threaten our political system.

The current antitrust laws were written without respect to the foreign

market. When these laws were created the foreign market was not as b...

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...ade, I

would allow to remain illegal, but I would not describe monopoly power, or attempting

to limit competition as a restraint of trade. I would allow the FTC to remain in action,

but only to prevent unfair trade practices, which does not include limiting competition,

and false or misleading advertising.

The ideas of John Kenneth Galbraith are, in my opinion, true. The antitrust

legislation in the US is outdated and based on outdated arguments. In our

current economy we have more foreign competition than ever. In order to be efficient,

and compete with foreign imports companies must limit competition. We now have to

compete within the new global economy and not just our domestic one. As times and

economies change, so should our laws relating to it.

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