December 15, 2005

Of FMS and NHB

Ever stumble on an exchange between a self-professed "free market supporter" (henceforth, FMS) and one or more normal human beings (henceforth NHB)? I did recently. I was startled, though I should not have been, by how quickly FMS resorted to throwing about such words as "caricature", "non-sequitur", "evasion" and "straw man".

As in, "you're caricaturing my argument and beating up a straw man and that's a non-sequitur and by the way, you're also indulging in evasion."

Whatever the NHB offered, however diligently they spelled out their views on free markets and asked the FMS to respond, they were met with this wall of words.

Now I know plenty of FMS who take the time to respond to questions, to explain their positions and how they see things differently. That's why they earn the respect of NHB. That's how they persuade people of their beliefs.

But that must be too hard for some other FMS.

And why shouldn't I have been startled? Because I've seen it plenty of times, often with "non-sequitur" helpfully linked to the Wikipedia definition, thank you so much. So many times, that I'm beginning to think what FMS -- one strain of them -- have in common is not free markets, not substance in their arguments, but a mastery of empty argumentative tricks. And a great reluctance to acknowledge that the other guys have points of view they have reasoned through.

Which is a pity, because issues with free markets are so complex and interesting, and people have such strong opinions, that they deserve debate and discussion. Not empty words.

54 comments:

TTG said...

This post, is an out-and-out troll. So you take Shivam Vij's side I see.. does this comment get past moderation?

Anonymous said...

Dilip, at least have the balls to take real names when you post stuff like this. If not, at least hyperlink to the post you're talking about. Even we know you're talking about Shivam Vij's post.

Show some balls.

Dilip D'Souza said...

I don't know TTG, did your comment get past moderation? It's hardly that I take Shivam Vij's side, it's that I find the quick resort to "caricature" and the like amusing, if still (like I said) a pity.

Whether it's laughable that an anonymouse demands a display of balls and "real names" would be easy to find, accept that I am not interested in doing so.

Also, whether this anonymouse is a Monish or Sanjay or Mahesh or something else would also be easy to find, accept that I am still not interested in doing so.

But finally, I'm decidedly not talking (just) about Shivam Vij's post.

Mridula said...

Dilip I like the term NHB!

Neela said...

D,

an interesting exchange over at shivam's page (I presume this is what you are referring to). personally i thought the freemarketer was extremely polite and articulate in defending his view and the other person (no I will not call them NHBs, seems to me unnecessarily biased against free marketers) was being fairly illogical and heated.

And personally I do think "strawman" is a nice word. Though i wonder if it has anything to do with "hangman" that marvellously entertaining game we played as kids. In any case, I'm going to start using it soon - as soon as I'm doing milking "epistemological" for all it is worth.

Dilip D'Souza said...

Neela, I thought both were being polite and articulate in defending their views over at chez Shivam. I really mean that.

But as I said earlier on this page, I find the quick resort to "caricature" and the like amusing, if still (like I said) a pity.

"Strawman" is a wonderful word. Have you tried using "vatic" every now and then? I found it in a Jonathan Raban book.

Neela said...

Ok.

More to the point, can I add "vatic" to "strawman?" as in "strawmanvatic"? It sounds positively portmanteauesque.

n!

Subash said...

FMS and NHB ..... Hmmm ...... Lets create another category of blogger Absolutely Abnormal Human Being AAHB.

Tanuj said...

dilip,

i also notice how quickly you resort to caricaturing the FMS, who in my opinion "diligently spelled out" his views, probably better than those you refer to, perhaps too kindly, as NHBs.

(given my passive inhalation of phd theories these days) let me also say that your post seems driven by "motivated reasoning" - you define an argument as logical, "diligent", robust, etc., just because you agree with that point of view. and just because you do not agree with a contrary opinion, you dismiss it as "empty words."

"..issues with free markets are so complex and interesting, and people have such strong opinions, that they deserve debate and discussion.." - i agree. so why not do just that, stick to the debate, instead of simply accusing people of lacking substance, using empty argumentative tricks, and so on.

finally, i find it interesting that you describe FMS's argument as "throwing about words", "mastery of empty argumentative tricks", and "empty words" in the same breath as you describe it "articulate."

Dilip D'Souza said...

Tanuj, I'm learning it comes down to whose views you tend to agree with!

Me, I've grown tired of counting how many times I've run into "caricature" and "non-sequitur" and the like. Whatever you say is met with that.

In the arguments I've got into, I try as hard as I can to offer my views, be sincere and as logical as I can be about them and my arguments, and listen to the other guy's views. And I don't use these words.

Would you say that's fair, given the arguments you and I have had? If not, tell me.

So it is frustrating to run into it like running into a wall. And I see it happening elsewhere, for only example in that case on Shivam's blog.

I do NOT dismiss the argument as "empty words." What I find empty are those words, "caricature" and the like. The rest, until these words make their appearance, is plenty articulate.

Finally, may I remind you that I also did say, and I did not say it lightly, that I know plenty of FMS who take the time to respond to questions, to explain their positions and how they see things differently. That's why they earn the respect of NHB. That's how they persuade people of their beliefs.

Some of those FMS are reading this, and there are others as well. I have enormous respect for them, and that's why I don't mean the acronym "FMS" to be in the least derogatory.

Why did you delete your last comment, from the Enron post? I was just about to respond to it when I found it missing.

Tanuj said...

dilip, i was only commenting based on what i read on shivam's blog, not from any of our previous discussions.

we have a difference of opinion here: to me, FMS's comments hardly seem only empty words or however else you describe it. you may be growing tired of some words, but that shouldn't detract from what seems to be a cogent argument from FMS - more so, may i add, than the NHBs' (NHBs - no offence meant. just an opinion based on a single conversation thread).

i know you said you know plenty of other FMS's who do a better job at explaining their position, etc., and i don't doubt that at all, but that is irrelevant to what this particular FMS said, how the NHBs responded, and how you judged the episode.

as for the enron comment, i guess there were other similar points already posted, so i removed mine. to reiterate, i would not choose enron in india as an example to further any meaningful discussion on the merits of free markets or otherwise. it could be useful though, as a case study on deal structuring, negotiation, legal systems and perhaps, how not to privatize a utility.

as for enron as a company, it is clear that they were far from legal or ethical, and they got punished for it. sure, many investors got a raw deal, and sure, there is a finite, non-zero probability that another enron might happen again, but that doesn't imply that people in freer markets are worse off. i recently read in the FT that the french govt has been underreporting its national debt by half! that's pretty much doing to taxpayers what enron did to shareholders. should i use this example to tom-tom the deficiencies of the role of governments? perhaps not. because individual examples are not representative and don't make for sensible debate.

Dilip D'Souza said...

Tanuj, it's what I said in my earlier comment, sort of echoing what you said: I'm learning it comes down to whose views you agree with.

On Shivam's blog alone, I saw Shivam's and Mridula's arguments as much more cogent than Amit's, not least because of the use of those words to fob off any attempt to explain.

And you saw it the opposite.

So be it.

As for Enron, response later.

Mridula said...

Tanuj, you understand what is a classical liberal as the FMS has described himself on his own blog, follow the Wikipedia link? Do you understand that economic position?

I am assuming you do. Then tell me how in this world full of imperfect markets like oligopoly and monopolistic markets, is 'classical liberalism' is going to work?

More competition is good. Did you read that? I made it bold. So, who is going to compete with Walmart and Microsoft? Why only two giant Cola companies?

And when I say this, do I become anti-reform, as Saket says on desipundit? Or is is a label to beat me up with?

The perfectly competitive market is an utopia as MFS said, his hope is

“Just because something does not exist yet does not mean that it is undersirable or unachievable.”

Amen to that.

The debate is from my side a comment on how things are now. I see a lot of oligopoly and I question it. In the process I question practices of giant organizations. Anything wrong with that?

Neela said...

Mridula: A quick point. I believe you mistake imperfect competition for no competition. As Samuelson says, some industries have brisk competition although there might be few firms in such industries - he cites the case of the airline industry. the cola industry is another example of this.

And er.. why so belligerent? I think saying things like "do you understand this" and saying "did you read that? I made it bold" takes away from your argument (whcih might be a very good one). isn't this the same thing that Dilip found objectionable in the FMS response?

n!

Mridula said...

Neela I did not start that way, billigerent I mean. I do not know at how many places you are following this debate, but if you criticise a private company, you are labeled socialist or anti-(free) market. Or you end up with a strawman! I am sick of that. Maybe that is why my tone has changed.

No, I am not mistaking imperfect competition for no competition.

My point is, if there are a few accounting firms then what stops them (or does not) from becoming an Anderson? Market pressure or regulation? Or both?

I am just trying to assert my right to criticise private organizations without being labeled anti-market (will not say free market, because markets are anyway not free) or socialist!

Put it another way, I do not agree with 'if you are not a classical liberal you are anti-market ...'

But point well taken, no need to beocome billigerent in the process.

Dilip D'Souza said...

Neela and Mridula, since N made this statement: isn't this the same thing that Dilip found objectionable.

May I say, I don't think it is the same thing. I have no problem with belligerence (not that I think M was particularly so). These are contentious issues, there will be heated discussions. Fine.

What I found objectionable is the use of empty words to dismiss arguments and opponents.

Tanuj said...

dilip - agree totally. happy to let differences of opinion be.

mridula - sure, you should "assert [your] right to criticise private organizations..." no issues with that at all. anyway, as i said, i didn't mean to offend you, but looks like i did. sorry for that.

neela said...

Mridula, I totally agree with you that anyone who is not completely pro-free market need not be labelled anti-markets.

Dilip, to me, belligerence and empty words are part of the same peripheral argument route that seeks to persuade using something other than the central argument. But i didn't mean to put words in your mouth.

Here's to strawmen and women and non-sequiturs.

n!

Salil said...

So, who is going to compete with Walmart and Microsoft?

For Microsoft, open source software (prominently Linux) give ample competition.

Mridula said...

So two companies microsoft and linux are competition enough to call it 'free market?' Or is it oligopoly?

Anyway the real questions are here.Sheesh! and I thought I could argue well, I see no justification in my arguing any more :)

Neela said...

Mridula,

I. wrote. a. comment. earlier. Please. read. it. You can have a highly competitive oligopolistic market. And that is good. e.g. Pepsi and Coke. I would call this a highly competitive market although the market structure might be oligopolistic.

and on an aside can someone clarify something for me: by free markets, are we talking about perfect competition? and how did the term "libertarianism" come to exist in the Indian blogosphere?

n!

Mridula said...

Neela, read comment above, I too said 'what stops an accounting firm becoming an Anderson in a limited competitive situation? Market with a few firms or regulation or both?'

I too would like to know what people mean by competition. Because I am also wondering for market to be an effective mechanism we need a lot of competition or two firms and call it competition. Though FMS said on Shivam's blog he does not support oligopoly.

The term I see is 'classical liberal' and FMS offer a link to the definition from his blog.

Anyway try Chetan's comment at desipundit or Shivam's post. Link to his blog (but it is not a post) is given in a comment above.

Salil said...

So two companies microsoft and linux are competition enough to call it 'free market?' Or is it oligopoly?

Mridula, I'd like to help you get some facts corrected. Linux is *not* a company. It is an operating system which is FREE - free as in free speech, and also free as in free beer; unlike the operating system you are using - Windows which is proprietary, where you have to pay Microsoft (unless you are using the pirated version ;-)).

So there is no oligopoly because there are plenty of operating systems available. You, as a consumer, have a *choice*. And this concerns all free/open source software.

This post isn't related to tech, but at least the stated facts should be true.

Mridula said...

Sorry for making the mistake about Linux but tell me how many other choices I have?

I am really interested. At last count we had two, Microsoft and Linux.

Linux, till date, my cyber cafe guy and the IT guys in my institute were not willing to install on my PC (I asked them because my husband asked me to, he is the tech guy in the family, but very lazy, he will not do it himself).

I even have Linux CDs that came with my laptop, still the cyber guy and my IT guy refused, giving all sorts of reasons, all of which I could not understand because for me a laptop is for internet connection and using a word processor :)

And all the law suites against Microsoft for upholding the consumer interest? We should give more power to them to uphold the consumer interest?

And by the way oligopoly means existence of a few firms in a sector. By latest count we have two players. Even if we make it five do you think it is enough? I at least do not think so, so let us agree to disagree.

Neela said...

Mridula,

Competition is not perfectly correlated with the number of firms. Its how the firms compete, the size of the market that each one has and so on. So the dnager in oligopoly of course is that one firm can swallow another and be a monopoly (which is surely bad). But if they compete fiercely (coke/pepsi) then its still a competitive market. Hope that answers your question. Of course perfect competition with a number of firms helps and if you hv an oligopolistic situation you need to be careful and have regulations to prevnet a monopoly from happening.

On anderson I'm not sure what your question is.

n!

Salil said...

I am really interested. At last count we had two, Microsoft and Linux.

Linux is just the OS kernel. Many companies build distributions on top of the freely available kernel and sell or freely distribute them. Now there are *about 100* Linux distributions (popular ones being Red Hat, Mandrake, Ubuntu, Suse...)
So besides Microsoft Windows (all the versions) and the 100 Linux distros, there is also Mac OS, FreeBSD, Solaris...

Hope you get my point. There are innumerable operating systems. But why does everyone buy Windows? Because Microsoft has succeeded in making such a good OS for the common man (hope i dont get flamed for this). So people use what
they like. This is a case of the consumer being in control.

And all the law suites against Microsoft for upholding the consumer interest? We should give more power to them to uphold the consumer interest?

Consumer interest: If you dont like Microsoft products, use something else. Microsoft doesnt force you to use Windows.

And by the way oligopoly means existence of a few firms in a sector. By latest count we have two players. Even if we make it five do you think it is enough?

Enough for what?
(Note that we have about 100 - much more than 5 ;-))

Mridula said...

Discussing technology is a waste with me, I do not have much idea.

However, you evaded the question of Microsoft lawsuites. They are trying to subvert the market or what is called 'anti-trust.'

When a market is not 'free' such things happen. And we need good law (that is made by the government) and a competent judicial system to keep the 'Microsofts' of the world in check.

So whatever may be the numbers of OS, Microsoft still has been hauled by courts for not playing fair.

Why was it not playing fair? My take is because it has immense power to do so against their smaller rivals. Markets are not just about efficiency, they are about power too.

You know about 100 OS and I know about lawsuites. I cannot discuss OS for the simple reason I do not know about them much.

Do you know about these lawsuites and their implications for the working of the 'free market'?

Anyway, if you still wish to talk about technology you will have to discuss it with someone else. For the simple reason that I do not know about them.

I brought Microsoft in the discussion because of their anti-trust lawsuites. Such law suites are brought against companies who try to reduce competition.

Dilip D'Souza said...

I'm not sure Coke and Pepsi are good examples of fierce competitors. In the US at any rate (while I was living there), there was plenty of evidence that (and much written about how) they tended to act more like a cartel.

I think the general view was, both had realized that neither would ever "win" the battle for the cola market and destroy the other, so they had a tacit understanding to coexist and make life very hard for the smaller players (RC, Jolt and the like). So you would have a Pepsi week in the supermarkets, where all Pepsi products were discounted and shelves and displays were stocked prominently with Pepsi -- but Coke would never discount at the same time. The next week, it would be Coke's turn, and Pepsi would not discount that week. But the combined effect was, at any given time there was very little shelf space for the smaller players.

I'm no economist, but I think the lesson here is that perhaps it is not possible for two practically identical products, made by two almost equally powerful companies (in the absence of other powerful companies) to actually compete in the sense we understand competition.

As for Microsoft and Linux. Yes, Linux isn't a company; yes there are 100 (taking a round figure) versions. But something is not quite right about therefore concluding there are 101 (100 Linux + one Microsoft) options for the customer.

For one thing, should we then conclude that there are more than 101? Because there's WIndows 98, and 2000, and ME, and XP, and NT, and who knows what other TLA.

For another thing, when I go shopping for a PC, I don't believe there's a single supplier who will say to me: OK, here are these 101 options for what OS you want. Pick one and get back to me, I'll put that on your PC. Nor will all those 101 options be up on some dislpay for me to choose. Whereas if I go shopping for, let's say, toothpaste or chocolate, I can see the options laid out in front of me.

Salil said...

What I dont understand is how Microsoft is a monopoly if they are not forcing anyone to buy their products? Neither is any other company.

The lawsuit against Microsoft concerned their bundling of Internet Explorer with Windows. That was a classic case of government regulation. And that case has also been criticised as being unjustified by free market advocates.

The reason we in India may not realize the availability of choices is because most of us use pirated copies of Windows. Even when you shop for an assembled PC, the vendor will always give it to you with a pirated version of Windows installed. You dont have a choice in that case.
So let us agree that the greater evil here in this case is piracy, not free markets.

Neela said...

Dilip,

The fact that you saw discounting happening at all is an indication of competition - this could not have happened either in a monopoly situation or in a cartel situation. The end result: The consumer has access to a discounted cola at all times, which is what makes competition a force for good. And as for smaller players, they are free to discount if they want to gain market share. Or make a better product. Or advertise better. Or do all of the above.

There are several examples of smaller players make life very hard for the Big Ones. In India, Coke and Pepsi for all their marketing muscle could not dislodge Thums Up, and Coke wisely understood that. In the tea market, HLL and Tata face enormous problems from smaller regional players although the former have huge resources and distribution systems. In detergents, Nirma took on a giant HLL and grew into a feared rival. In soups, a tiny Bestfoods took on Maggi (which wa sa monopoly product at the time) to create Knorr Soups and become the market leader. I could cite many other examples where smaller players have done well when they fill a market need and provide a good product and its not necessary that large corporations always crush smaller players. Freeing markets means everyone - from large multinationals to smaller outfits - is welcome to enter the industry. The end result: choices for the consumer and better products (whether lower on prices, better service, better quality - is wha tthe market demands).

As for operating systems, choices exist. They may not be as easy to access as toothpastes but they exist. If you dismis the many Linux versions and the many MS versions because they are each made by one company, you should similarly dismiss all the brand choices you have in toothpastes, because 90% of the toothpaste market is controlled by three players: HLL, Colgate and Dabur. Further, the reason the toothpaste market in India has so many easily accessible choices is that all three players understand the importance of distrbution and marketing. The trouble is that this hasn't yet happened in the OS industry, Mac notwitstanding. The day someone comes up with a marketing and distribution machine to rival Microsoft, MS will be in trouble.

Of course, I must in all fairness add that its probably easier to enter the toothpaste industry than the operating systems industry because there are lowe rentry barriers in the toothpaste industry. (interestingly, a recent rsearch showed that industries with the lowest entry barriers also had the highest exit rate).

n!

Mridula said...

"The lawsuit against Microsoft concerned their bundling of Internet Explorer with Windows. That was a classic case of government regulation."

So they should throw anti-trust law out? Try suggesting it. Good luck.

Salil said...

Perhaps you could take that up with law experts.
There are arguments in favour of and against Antitrust laws. More on that you could read here:
http://en.wikipedia.org/wiki/Antitrust_laws

bigsur said...

Dilip

Just wanted to bring to your attention this essay by Paul Graham that I feel is relevant to the discussion.
http://www.paulgraham.com/inequality.html

Artful Dodger said...

Dilip, dont bother responding to ball-less people like TTG and anonymous. With the stance that you have taken, you have proved that you are a NHB. Kudos.

But may i ask you, what is your opinion on that marathom comment?
http://pehlu.blogspot.com/2005/12/
my-gripe-against-libertarian.html#comments

Doesnt this guy deserve a gold medal?

Mridula said...

Salil, sure there are two sides to any issue and so it be with anti-trust law. But as long as it is a law, I do not condone breaking it.

Dilip D'Souza said...

Dodger, I don't believe TTG lacks balls. What he lacks are [insert-spelled-out-synonym-for-"fucking"] synonyms for "balls." Right, TTG?

About reacting to Chetan, I might, separately. Let's see.

Neela, I don't "dismiss" the many Linux/Windows version. I'm happy to have them. I mentioned that for two reasons. One, that if we are talking about 100 versions of Linux, then there are also several versions of Windows. Two, even if there are these 100+ versions, it's not as if that choice is available to me when I shop for a PC.

Bigsur, a fascinating essay. Thanks for the pointer. I think too that we should be attacking the space where money and power start to overlap.

Gaurav said...

Mridula,

Just because something is a law, it has to be right? What about laws which are wrong themselves? It is criticising these very laws that helps change or trash them.

In my opinion, the law making homosexuality illegal in India is wrong. if you feel this is taking the point to an extreme, according to me the laws limiting the number of licenses for Delhi rickshawwallah to just 99 lakhs without any justification, is wrong.

So for me, the remaining 4 lakh rickshawwallahs in Delhi who are technically "breaking the law" and are hence persecuted on a daily basis are being wronged, because they are suffering under a wrong law.

For me the rickety land ceiling laws and the expansive "public property" that makes slums illegal are wrong. SO will I just shrug at slum demolition drives because "hey, by building slums they broke the law and i do not condone it."

I am sure you would sympathise with homosexuals, rickshaw pullers and slum dwellers though "technically" they have broken the law. I would too. Why then deny Microsoft thie very sympathy? Because it is a billion dollar corporation?

Mridula, if you well and truly believe Microsoft has done something which you consider wrong, then by all means go ahead and castigate it. Give us reasons listing what was it that Microsoft did which was so wrong, and then we can debate it. But merely stating that there are lawsuits against them, and that a judgement has gone against them, hence they are wrong, in my opinion, will not suffice.

Now one very important point. Microsoft's anti-trust case is a totally different ball game than Enron. What Enron did was known to be wrong. i.e they were actually "breaking" the law. i.e, in the Enron case, the big question for a judge was to determine "IF" the said things happened.....and not whether the said things broke the law or not.

In Microsoft's case, it isn't so. Microsoft didn't hide the fact that it was bundling IE with Windows, the way folks in Enron hid their crimes. The question for the judge in the case was "IF" what Microsoft did was actually breaking the law at all. That was a major judgement call.

Now note that the Department of Justice settled the case out of court. In the settlement, they didn't insist Microsoft change its code, or not bundle software...the very basic point of contention.

So I don't know about you, but for me.....and most of the others..(including Microsoft-baiters), this seemed like a victory for Microsoft.

So even speaking from a strictly legal POV, accepting your premise of obeying the law, Microsoft is still OK.

My own opinion is exactly what Salil says. If other products are available for sale/download, how is Microsoft a monpoly? It is just a company that has mapped its consumer's exact demands perfectly well.

I asked you a question about regulation regarding movies. This is similar. You avoided that question. Please answer it. DO you think Yash Chopra's making popular candyfloss movies every few months "kills" small competition? Is there an oligopoly in the entertainment industry which needs to be broken up by government regulation?

Gaurav said...

neela, why dont you have a blog? if you did, i'd be a regular reader. :)

Kingsley said...

Maybe you haven't had to deal with multiple people try to argue a point in the same faulty way? Argument fatigue is the reason why some of us use terms for faulty logical patterns to point out flaws in arguments made against us. When time permits, we may use satire or analogy. But it would be a waste of our time to repeat the same argument over and over again to every person who holds a stupid belied. That's why we use those terms, link to an explanation and move on.

Kingsley said...

And neela, you should get a blog.

Mridula said...

For Yash Chopra thing, I considered the queston very trivial. Of course, I can go and make movies tomorrow and compete with them, after all in a 'free market' there are no entry costs?

Let us not compare the legal framework of the US and India. If Enron happened here, I am not sure the top officials would have been punished.

Gaurav, what about those politicians who break the law or the goons? Or take our Salman Khan? You have sympathy with them too? I keep Microsoft with them and not the rikshawalas and the likes. You gave me an unrelated anology, so I give you one back :)

Remember the pie in the face (of Bill Gates)?

Gentleman, can we agree to disagree?

Gaurav said...

cFor Yash Chopra thing, I considered the queston very trivial. Of course, I can go and make movies tomorrow and compete with them, after all in a 'free market' there are no entry costs?

Thank you! That is exactly my point about Microsoft. In a free market anyone can make an OS and compete with them, as indeed have so many folks. But they have lost. Why? Maybe because Microsoft has been able to deliver what customers want in the best possible way? And it is not just about "tiny" Linux corporations who have been "crushed" by Microsoft's might. Big giants like IBM and Sun have competed with Microsoft and lost. In fact one of the best decisions Louis Gerstner took when he took over an ailing IBM in 1993 was to concede that the OS battle had been lost, and Microsoft was a deserving winner. (Read his book 'who says elephants cant dance?').

Calling Microsoft a monopoly is hence wrong. One can say this even after hating their products. Take Salil for instance. I know for a fact that he uses Linux at home. ANd he wouldn't be caught dead endorsing Microsoft products. But he is also saying they aren't a monopoly.

Microsoft is no more "killing competition" than Yashraj films is.

Gaurav, what about those politicians who break the law or the goons? Or take our Salman Khan? You have sympathy with them too? I keep Microsoft with them and not the rikshawalas and the likes. You gave me an unrelated anology, so I give you one back :)

It is not unrelated Mridula. Perhaps I wasn't very clear. Let me answer your question and explain. I have sympathy with rickshawwallahs because the law which they are targeted by is itself wrong in my opinion. I have no sympathy with Salman because the law he was targeted under (for the black buck case, pedestrian case) was right. You can't go around killing people and deers. Ditto with the politicians.

I sympathise with Microsoft because I believe the anti-trust law itself is wrong.

Now, evidently, you feel anti-trust laws are correct. We can agree to disagree on this point. I feel they are not right, you feel they are.

But for the purposes of the argument, if I grant that anti-trust laws are very valid, I still don't see why you are criticising Microsoft. Could you list one or more of their practises that are blatantly anti-trust? And what is your opinion on the American department of justice settling the case, and the supreme court quashing the objections raised to by the state?

Is just filing a lawsuit against them enough to pronounce them as guilty of anti-trust activities? Even after those lawsuits are over?

And I assume the "pie in the face" was a flippant comment.

Mridula, you are free to just 'agree to disagree', and we can end this discussion here. But I would request you to make a short comment about what exactly is it according to you that Microsoft has done which kills competition, and why you disagree with the American Supreme Court and DOJ?

Mridula said...

So Gaurav, if you and I and everyone else starts deciding which law is right or wrong, and to follow those laws that I or you or some other dude considers right, where will this lead to?

Ever pondered over it? Think about it globally and not just in India's case, because in our case not only laws are an issue but their implementation too is an issue.

Are you convinced there are no 'entry barriers' to my joining the film industry? Could you not see my sarcasm in my previous comment? Do you remember what are entry barriers and what they do to 'free' markets?

May I also say that all the economic theories and ideologies make perfect sense in the books and the articles, it is the big messy world I find difficult to understand. No one ideology explains it perfectly to me.

And, I do not know Salil or anyone of you enough to know what you use at home. So pardon my lack of knowledge about it. What kind of an argument was that? 'Salil says Microsoft is not a monopoly but uses Linux!'

Shall I tell you that XYZ says Microsoft is a company involved in anti-trust court cases and still uses, well, Microsoft.

Anyway, from my side enough said.

Gaurav said...

So Gaurav, if you and I and everyone else starts deciding which law is right or wrong, and to follow those laws that I or you or some other dude considers right, where will this lead to?

A flourishing democracy?

That's what democracy is, Mridula. It gives me the right to decide which law is wrong. And if enough people are swayed by my opinion, then the law is repealed. Sometimes policy makers see sense in repealing the laws and they are repealed. For example the partial dismantling of the license-permit-quota laws. Or the repeal of TADA.

And Mridula, did you not notice, I said, even if I do grant your position, that the law is right, what wrong has Microsoft done? The company was taken to the court under those laws, and the court case ended in what was almost a vindication of Microsoft's stand.

At the risk of repeating myself....what exactly has Microsoft done which is so wrong? You refuse to answer this question. Do you think bundling IE with Windows was wrong? What exactly are their sins?

Are you convinced there are no 'entry barriers' to my joining the film industry? Could you not see my sarcasm in my previous comment?

I am sorry, but I did indeed miss the sarcasm. Are you then actually in favour of regulation in the film industry? Do you believe Yashraj Films kills competition by regularly bombarding the market with kitschy fare?

The point I was trying to make was that if you aren't pushing for regulation in the film industry(I assume), why push for it in the OS market?

Do you remember what are entry barriers and what they do to 'free' markets?

Yes, I am aware of barriers of entry. If I recall Economics101 clearly, entry barriers are the obstacles that stop a company from entering a particular industry or market. Could you specify the entry barriers that an OS manufacturer faces? Clearly, since there are several OS suppliers in addition to Microsoft, these so called "barriers" have not been effective since so many have entered the business despite these obstacles.

And, I do not know Salil or anyone of you enough to know what you use at home. So pardon my lack of knowledge about it. What kind of an argument was that? 'Salil says Microsoft is not a monopoly but uses Linux!'

Pardon me, I probably didn't get my point across clearly. I just wanted to clarify that neither me nor Salil are fans of Microsoft products....any more than we are fans of Yashraj movies. But I guess that's besides the point, as you rightly said.

Anyway, from my side enough said.

As I said, it's your decision if you want to end this debate here. But for the record, I would like to say that I would have liked to see a summary of what exactly has Microsoft done that is so wrong in your eyes.

Mridula said...

Ok Gaurav one last try.

That's what democracy is, Mridula. It gives me the right to decide which law is wrong. And if enough people are swayed by my opinion, then the law is repealed.

Yes as I said from my initial comments, you and I and dude had the right to get the law changed. But not to break it, unless we are powerful enought to get away with it in a democracy like India.

I am sorry, but I did indeed miss the sarcasm. Are you then actually in favour of regulation in the film industry?

If I recognize entry barriers I favor regulation?

No, all I am telling you is the markets are imperfect and i do not have a lot of fait in big corporate giants who can raise the entry barriers and stifle competition. So you see, it is still Eco 101, only a few chapters ahead of perfect competition.

Ok, here is a list if things I have seen about Microsoft in news clips, all of which come up in any ordinary google search.

After the stock market closed today, RealNetworks filed an antitrust lawsuit against Microsoft. Real joins Netscape and Sun Microsystems filing major antitrust suits against Microsoft. AOL-Time Warner, Netscape’s parent, settled its Microsoft lawsuit in May.

The case comes as the European Union rapidly approaches the close of a separate case that affects Microsoft’s digital media technologies. The EU’s Competition Commission has indicated that it may ask Microsoft to unbundle Windows Media Player from the operating system.

Apparently, bundling is one of several facets of the Real lawsuit, which was filed in San Jose, Calif. The company is not seeking any preliminary injunction that would immediately affect Microsoft technology, such as a compulsion to carry RealPlayer on Windows. While the lawsuit apparently does not specify remedies, Real is putting $1 billion-plus on potential damages. The company also plans to ask the court for behavioral changes, which, should Real ever win the case, could affect Microsoft business practices.

The EU and Real cases raise interesting questions about Microsoft’s technological business practices, given Windows’ huge market share.

http://www.microsoftmonitor.com/archives/002021.html

Here is another one:

Chicago resident Robert Byers isn't buying Microsoft's claim that "only" 3% of the Xbox 360s that have been sold were faulty, so he's filed a class action lawsuit against the corporation in an Illinois federal court calling for undisclosed damages, litigation expenses, and the replacement or recall of 360 consoles. The suit claims that Microsoft knowingly released a defective product in order to beat Sony (and presumably Nintendo) to market and gain an early foothold in the next-gen console "war."

I forgot to copy the link before closing the window, but I am sure if you are interested you can google it.

And finally this:

MICROSOFT HAS had a long, a very long history of litigation, court orders, patent infringements and antitrust lawsuits against it since the very beginning of its history. We;ve managed to draw up a partial list of these.

The surprising thing is not only the number of those lawsuits against Microsoft – at one time, it had more than 130 pending – but more importantly, the sheer amount of money it represents.

The Redmond giant has been ordered to pay nearly $9 billion, a figure which is set to rise with some lawsuits still to be ruled on.


http://www.theinquirer.net/?article=24621

You have not read all this before? I do not know much about technology but it has media player, some game consoles and various federal law suites for selling customers windowns at higher prices. it is not just IE and whatever.

Gaurav said...

Thanks for the response.

1. Yes, I agree that it may not be acceptable to everyone to break laws, even if they are wrong. But my point regarding Microsoft is that they did not actually "break' a law like Enron did. Microsoft did something, and the courts were asked if what they did broke the law. And of course, the US Supreme Court did not think so.

When did I say you favour regulation of the film industry? In fact I specifically said that I assume you don't.

Bundling of products - There is nothing wrong in bundling products or discounting prices, as long as the products are Microsoft's intellectual property. If they poured money into developing it, they have a right to sell it however they want.
And as I said before, whether even this constitutes anti-trust is a matter of judicial discussion. The American Supreme court, for instance, did not force Microsoft to unbundle the products at the end of the USDOJ vs MS case. The EU case is still sub-judice, as is the RealNetworks case. So we should not term it as "anti-trust".

The xbox case - Again, the case is in the courts. So it remains to be seen if a law was actually broken. But if a company wants to rush into the market with a bad product, it does so risking its own reputation. I am sure whoever got fault xbox's got a replacement under the warranty.

Finally, no one is claiming that Microsoft is a saintly company. They must have made mistakes as any company has, as shown by the inquirer link. But the charge you were making was an anti-trust one or of anti-competitive practices. Not a single of those was of that nature.

Gautam said...

Being accused and being convicted under the law are different. Being convicted and settling out of court are different. An important component of the rule of law is that a person or corporation is innocent until proven guilty. Also because M$ is found guilty of some violations under some laws does not mean that it is inherently evil, as Mridula seems to consistently suggest.

Certainly M$ should be penalised for breaking any law. But a simple accusation cannot be construed to be a proof of guilt. I could for instance accuse Mridula of being intolerant and concieted, or she could accuse me of the same, but it does not in any sense mean that either of us are.

Mridula keeps mentioning that she does not understand much about technology. However I am sure she appreciates atleast one fact - that technology changes rapidly and more so with every passing year. (The philosopher of history and technology Ray Kurzweil would be a good reference for more detailed studies.)

In this environment of rapid change, if we were to stop and say that M$ is erecting entry barriers for Real or Apple in the media player sector, can we do it independent of the fact that M$ is part of a thriving competitive market (despite there being only a few large influential players in the market) in the search engine business.

Google and Yahoo in that business are doing what they must to ensure that M$, and each other are given a good run for their money. Real is following in the footsteps of Netscape before it, which sued M$ and then did not improve its product, which died an ignoble death. IE for the last 5 years has improved very very little, but has still remained the leader simply because there were no alternatives, till Firefox was released earlier this year.

The good intentions behind anti-trust law, are dramatically diluted when it serves as a rent-seeking mechanism for lazy companies. In an increasingly fast paced world, Anti-trust is going to become not only anachronistic but also a paramount excuse for incompetence.

I might add that though I use M$' products as my OS, I use a great deal of 3rd party software and would love to use Linux if not for its high learning curve, and the costs of clicking out of the windows network. I was not forced by M$ to buy its products, though I am sure they exerted some influence on my hardware provider, by virtue of having a large amount of useful user friendly software available to run on their OS.

For an idea to survive it must be good, for it to thrive it must be open and easy. Software developers will tell you that lately M$ has been publishing larger amounts of Windows code, so that it can compete effectively for the best programmers who would otherwise be attracted to Linux' flexibility.

Dilip mentioned earlier on, that a 100 flavours of linux are like the different versions of Windows. That is a falacious comparison.

All the versions of Windows were produced and serviced by M$. If Dilip was a computer programmer he would not be able to create Windows Dcubed, because he would not have access to the code, and even if he did he would have agreed not to use it that way under the M$ License.

Linux on the other hand is a very small component of RedHat Desktop or Debian or Ubuntu or which ever flavour. The particular vendor is able to access the code because of the Gnu Public License, use it, comdify it and release it according to his personal preferences but is bound by the license to give away the new code as well. Also the vendor chooses what supporting software is provided, and whether to provide service and how much to charge for it. In this sense they compete with one another, and are not a single entity, even though they draw on a common technology. So if Dilip were to take time off from writing and blogging, and become an ace computer programmer he could in principle create Dcubed Linux.

Besides Linux and Windows there are now other alternatives as Salil mentioned, some of them are viable for desktop users others are tailor made for the more lucrative server OS market.

I hope this has been a helpful contribution to the debate.

Dilip D'Souza said...

Gautam, it was a helpful contribution.

May I just say this much. I know the difference between Linux and Windows. I'm not trying to equate the two. What I mean is this: when I got out to buy a PC, a vendor will typically ask me: what version of Windows do you want? 98, XP, 2000, ME, NT, what? Typically vendors don't know much about Linux, and I would have to install it myself; and in doing so, I would have to choose between the 100 version of it.

It's the choice I'm talking about. I think there is an analogy between me choosing between the various verison of Linux, and my vendor offering me various versions of Windows. That's all.

Gautam said...

I suppose that analogy could hold. However if we look again at the technologies, the reasons why the computer guys would want to sell you Windows instead of Linux, are primarily because of the large positive network externalities associated with using Windows.

Linux is a great experiment, and in some of its forms is perhaps approaching Windows in usability. But does not at the moment provide enough of an advantage, that it would prompt people to move over in droves. This is not the fault of M$ even if they are benefitting from it.

[For non-economics people: A positive network externality is the benefits to be had from being on the same page as other. Think of English and why everyone wants to learn the language.]

Mridula said...

Yes, I agree that it may not be acceptable to everyone to break laws, even if they are wrong. But my point regarding Microsoft is that they did not actually "break' a law like Enron did. Microsoft did something, and the courts were asked if what they did broke the law. And of course, the US Supreme Court did not think so.

So they shelled out all those billions to settle various law suites to their cometitiors out of good will and charity?

Have some perspective:

Alacritech undisclosed
Kansas $32,000,000
AOL $750,000,000
Maryland $10,500,000
Apple $250,000,000
Massachusettssetts $34,000,00
Arizona $104,600,000
Minnesota $240,000,000
AT&T Undisclosed
Montana $12,300,000
Be $23,250,000
Mythic Still in court
Bristol $4,100,000
Nebraska state $22,600,000
Burst $60,000,000
New Mexicoco $3,150,000
California $1,100,000,000
North Carolinalina $89,000,000
Carlos Armando (1) $8,960,000
North Dakotaota $9,000,000
Columbia $6,200,000
Novell $536,000,000
DR DOS/Caldera $500,000,000

And this is a partial list.

http://www.theinquirer.net/?article=24621

Gaurav said...

Mridula, Just digging up a list of the payments Microsoft has had to make is not enough to convict them.

Speaking of perspectives, examine each case, and you will realise that most of those amounts are settlement amounts.

How many of those fines are a result of convictions?

Kunal said...

Any sane corporation would do the same if faced with fighting a tort battle in an American court.

http://www.overlawyered.com/

Kunal said...

Settle out of court, that is.

Alka said...

"Mridula, Just digging up a list of the payments Microsoft has had to make is not enough to convict them."
Mridula, these were development fund from MS to various companies, so that these companies can come at par with MS. By making these payments, MS was helping these companies to stand up and fight with MS on equal ground in a "HEALTHY" competitive environment.