Barnes & Noble is in real danger of disappearing, and that has David Leonhardt of the New York Times worried. This isn't just a case of a corporate giant being unable to keep up with the new age, he writes. It's the result of a misguided government policy about monopolies that goes back to the 1970s. Around then, the government view that all monopolies are evil began to shift; the new idea was that behemoths weren't bad as long as prices stayed low, and that policy has resulted in "leniency, under both parties, toward technology giants that have come to resemble monopolies." Amazon, and its impact on the book business, is a case in point. So what's wrong with the emphasis on low prices? Two things, writes Leonhardt.
First, "prices are not a broad enough measure of well-being," he writes. "If prices stay low but wages don't grow—which is, roughly, what's happened in recent decades—consumers aren't better off." Second, regulators focus on short-term prices and sometimes ignore what happens when one company conquers its rivals. (Amazon just raised the price of Prime.) Leonhardt likes Amazon as a consumer, "but I am also starting to wake up to the deep problems created by corporate behemoths." Specifically, "they have the power to hold down wages, avoid taxes, squash competition, and produce a less vigorous economy." He's holding out hope that the government once again takes a dim view toward them, and he's rooting for Barnes & Noble in the meantime. Click for the full column.