Leo on Warpcast

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Cameron Armstrong

“Under Antitrust laws, you become a criminal the moment you go into business. If you charge too much, you can be prosecuted for monopoly. If you charge too low, it’s unfair competition. If you charge the same prices as your competitors, you can be prosecuted for collusion” What’s y’all’s take on this take?

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Nah this ain’t a good take These things are bad if and only if you can convince court that these pricing decisions are related to market power In essence, if you have too much market power, antitrust should be able to get to you no matter what your prices are As it should be

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Cameron Armstrong

So while ultimately I agree with you I’d push back on the characterization slightly - regulators (unelected one’s btw) don’t have to convince a court of truth in order to materially damage or hinder your org. They just have to threaten or charge and you’re locked up in a multi year public swamp trial

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Yeah fair in theory Are there many actual examples of a govt agency swamping a private company in cases? Even so, they should usually have good reason to act, because they should be accountable to parliament/Congress

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Cameron Armstrong

I’d have to check the timelines but FAANG over the past 15 years has basically been consistently threatened by the FTC (not that I’m worried about them) - probably the best example of swamp is failed mergers (like visa plaid) that are extrajudicial threats without any opportunity cost from the ftc?

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But that sort of Visa acquisition is exactly the sort of thing antitrust wants to stop: incumbents buying up competition I really think regulators only care about big companies who won’t get swamped by a law suit from a government agency

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Cameron Armstrong

But didn’t we just establish that antitrust is about behavior? Buying competition != anticompetitive pricing In fact, w a few beers in me I might argue for fun that undercutting eyepopping acquisitions disincentivizes entrepreneurship in competitive spaces 😂 Don’t punish plaid if visa is a monopoly y’know?

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I think antitrust is about preventing abuses of market power, so both preventing a duopolist existing/strengthening and actually stopping anti-comp pricing is important. (Visa ticks both ahaha) I totally get how this also punishes Plaid and all the exit to FAAMG startups!! (pt 1 of 2)

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like, i agree that this disincentivises entrepreneurship. This is fully true But policy has tradeoffs. If big companies can buy every competitor, innovation will slow. If big companies can never buy a competitor, innovation will slow. I think big cos should be allowed to buy some challengers, but not all of them

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