In yet another wonderful display of American justice, the Supreme Court of the United States voted Thursday, June 28th, by a narrow margin of 5-4, that a 96-year-old antitrust precedent was null and void, ushering a new age of price fixing. As if the consumer doesn’t get the short end of the stick every time they are emptying their wallets, pockets, and credit cards at the cash register already, now corporations are actually being allowed to work with each other to bring about higher minimum prices for which ever products they see fit?
Remember how we were told that monopolies were bad? No, not the game – Monopoly is awesome – I’m talking about monopolies when one company gets a stranglehold on a particular market with a particular product and by way of force gets to keep competitors out. Whether it’s by erecting barriers of entry to potential competition or by limit pricing, one company makes it to the top and stays there by muscling everyone else out. We know this is bad for the end user because a lack of competition means that one group dictates the price of the product or service, and being the only provider, they can set the price where ever they like, even if it’s unreasonably high and therefore unattainable by John Q. Public.
This ruling maintains that while monopolies are still illegal and unfair to society, duopolies, for example, are now quite legal. What they are saying is that while one operation who sets unrealistically high prices for their products is unconscionable and immoral, allowing two companies to collude on that same unrealistically high price for their products is completely and totally acceptable. How could they ever see this as being a good thing for any economy?
Of course, the justices that make up the panel noted that while the spirit of the law is commendable, the scope of it is too broad, and that the wording should be re-written to be more vague, and that judges ruling on cases using the new laws should emphasize discretion and treat each on a case-by-case basis. Right. That’s exactly what will happen. I want you to think long and hard about the last time a governing body of any kind purposely created any kind of rule or standard intentionally unclear with positive results. If you can come up with even one example that doesn’t have to do with preventing bodily harm, I invite you to submit it.
There are literally thousands of lawyers out there who must be chomping at the bit right now, knowing that political influence in a particular presiding judge may actually have some effect now – the judges have discretion, so why not attempt to affect that discretion, right? We all know that lawyers are the most ethical and upstanding citizens, why not give them another avenue to express their “creativity.”
I cannot wait to see the fallout from this. Every lobby group ever formed based on any kind of economic stance, is going to have an absolute field day with this ruling. I can only hope that there are at least a few decent human beings left who wield the gavel in the court systems down south, because if not, things are about to get a hell of a lot more expensive for our neighbours on the other side of the 49th parallel.
Minimum-Price Accords May Be Allowed, Top Court Says (bloomberg.com)
Supreme Court Decision (PDF)