Capitalism shmapitalism

IN CAPITALISM, a business makes money by taking great care of customers, that is, by delivering great value at a fair price. What keeps the price fair? Competition, of course.

Or so goes the fairy tale.

Ever bought a new car? There’s no great value at a fair price going on. What’s going on is a tactical war between dealer and customer, where the dealer is willing to accept less but tries to get the customer to pay more, and the customer is willing to pay more but tries to get the dealer to accept less.

Ever bought real estate? It’s essentially the same game.

Many forms of retail shopping are no better. I stepped into a well–known retail furniture store and found six barstools I wanted. A salesperson told me the price. “I’ll shop around,” I said, whereupon the salesperson immediately dropped the price by no small amount. The same thing happened in another store when I was shopping for an adjustable bed. 

Call me naive, but I would think that taking great care of a customer would entail leading with your best price.

When I owned an advertising agency, I stuck to a price list for our various services. By contrast, a good many of my competitors would learn how much the client had budgeted and simply take it. Again, call me naive, but that seemed to me a lot like grifting.

Consider all of the mergers and acquisitions going on with communications companies, streaming services, social media, and retail giants both online and in–store. Do not think for one moment that such are motivated by a desire to take better care of the customer. The idea is to return value to shareholders (whose interests are often at odds with those of customers — see my earlier post, Three Problems with Shareholders), plus control information, and wield power over those who might otherwise seek to regulate them. 

These and other abuses are inevitable results of so–called free markets, of unbridled capitalism. Capitalism has no regard for fairness or decency.

To be sure, some businesses still seek to treat customers with fairness. Here’s to the few.