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Comment by ellius | Hacker News Reader

If anything, the amount of shadow work foisted on customers has increased. Somehow it's a norm to have to go through a bunch of bullshit to have errors corrected and often just to get halfway decent service. It's obviously worse in industries without meaningful competition, but society in general seems to put up with it and assume that's just the way it is.

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Yes - it is not illegal or even unlawful for a doctor, an insurance company, a utility like a power / phone / water company to send you a grossly incorrect bill and cause you dozens of hours of work to get them to see THEIR mistake.

If our Internet cuts out and I have to call in to get it fixed I calmly but firmly let them know that I must be fully credited for the day, pro rata.

They always have beef with this and tell me that “normally they don’t do X or Y unless A or B”. I tell them that I fully understand their position, but my position is this:

“When I hang up this phone call it will either be because you have credited me for the day that my service failed and I had to do your company’s job debugging it, or because I have terminated my service. The choice is yours but those are the only options.”

That’s how I wound up reverting to DSL service for a year. The invisible hand can’t grasp monopolies.

Yeah, this is not doable in most US cities I’d guess.

The sales people will often give you discounts if you ask, or pretend that you might cancel :)

Don't blame "the invisible hand" (the market) for those monopolies.

Utilities like water, gas, and electricity are monopolized by the state: torn away from the market's invisible hand.

Internet providers use government regulations, not available market forces, to keep out competitors.

What’s free mean when talking about markets exactly? Free from what?

Regulatory capture I'd guess.

An ideal free market is one is which no coercion occurs, including state coercion like regulations and taxes, and private coercion like theft and fraud.

Colloquially, a free market refers to one in which a minimal amount of government intervention occurs. The less state intervention, the more free the market.

No, that just gives rise to corrupt capitalism. Like expecting law and order without police and courts.

Without regulation and strong intervention against problematic companies cartels, profiteering, monopoly and all the other problems of unconstrained capitalism tend to result. Standards will fall, prices will rise, deals will be done on golf courses and in (formerly) smoke filled bars against the interests of the customers.

The best markets are ones that have a clear market, and are kept free and ethical by strong and appropriate oversight (government). Needless to say there are many markets that are not appropriate uses of the market, and oversight does not work too well with a revolving door between commerce and regulator, smoothed by filthy lucre.

There’s a number of problems that can occur in markets without any coertion - e.g. principal - agent problem, or asymmetric information - that make a market less efficient and thus worse for paricipants. The job of the government is to work to prevent those, even with coertion if necessary (e.g. fiduciary laws, food standards, ...). There’s a tradeoff between too few laws (reducing market participants’ confidence in the goods/services they buy) and too many laws (increasing barriers to entry and causing monopolies).

I think it's bad to define a word for a situation in terms of what you think it takes to get there. Because that encodes your prejudices where it's not necessary.

Whenever you define freedom as "what you get when you do X" you have set yourself up for Orwellian denial of reality.

I think a good way to define freedom is "the condition of having a reasonably large number of good choices". The better and more diverse the choices, the more freedom.

> Internet providers use government regulations, not available market forces, to keep out competitors.

High initial investment cost have totally no role to play at that. Or landlords allowing only a single ISP [0]... that's just part of the market... you can always move, after all. But no, dysfunctional markets must be because of government regulation, since markets are so great that there are no other form of market failures.

Sorry, but equating regulatory capture with "government regulations" kind of triggers me. Companies obviously will use everything possible to their advantage. Including dysfunctional governments. At that point, fixing your gov might be the more important issue...

[0] https://www.eff.org/deeplinks/2019/06/fcc-siding-landlords-a...

High initial investment costs (for laying fiber etc) won't stop someone like Google. What stopped Google fiber was regulatory barriers set up by municipalities to help their local ISP cronies.

> Sorry, but equating regulatory capture with "government regulations" kind of triggers me.

Regulatory capture is composed of government regulations.

> fixing your gov might be the more important issue

Exactly

Well, Google isn’t blameless here. Google was also either hubristic or incompetent and thought just because they were full of smart people, could “fix” anything.

Google Fiber and “shallow trenching”. https://arstechnica.com/information-technology/2019/02/googl...

It’s also not exactly unlike Google to abandon projects for the new ooh shiny.

Yeah, it stretches the imagination to no end to think Google couldn’t make something work due to regulations.

As I understand it, shallow trenching was a way to try to get around incumbent lock-in. They were trying to bypass the barriers that were raised by regulatory capture.

No they did it just for speed and cost. Once they got permission and right of way access from the city to do trenching, it wasn’t a different permit to do shallow trenching as opposed to the regular method.

I don't have any hard numbers, but I'm going to wager that regulatory capture through pole attach rules has way more impact than high initial investment or landlords.

I've experienced how local governments handle ISP regulation first-hand. I can say with confidence that it causes many, if not most, issues with ISP monopolies in suburban and rural areas in the US.

Regulatory capture is a market force.

No it is not. Regulatory capture is created with the influence of market actors, but cannot exist without state (non-market) policies and enforcement.

Oh so wrong. Just about all those places who privatised state utilities and brought in the market are, in varying degree, regretting it.

Take Thames water, busy playing with offshore finance plays, massively increasing profit and exec pay whilst reducing on all performance measures. Worst nationally for leaks, rate of fixing leaks, managing supply, it goes on.

"Privatizing" state utilities is not equivalent to bringing in the market. Usually privatization just means converting the government-managed monopoly to a heavily regulated, privately managed, government-sanctioned monopoly. There's no market there.

There is a market across much of Europe, a proper, functioning mature but rent-seeking market - as is to be expected from a utility.

I can get my electricity from any of the companies in the UK, same for gas, without any restriction. I can choose on price or service, regardless of where I live. Yet service standards have declined, prices have risen far in excess of inflation, and buffer overhead of generation, production and storage has declined. The national grid is more fragile than it was as a result. That's despite efforts of the grid to modernise, and provide a smart grid for renewables. It's required additional regulation to bring back a little headroom on the grid, and inadequate regulation to prevent extreme profit-seeking. The projected plans for additional pumped storage and hydro and tidal schemes have been shelved. For decades. Electric has indulged in the same banking roulette with currency plays seeking profit in preference to producing electricity.

So what part of the market is missing? None. What advantages has the market brought? For execs and shareholders, free money! For customers and the climate? More costs, poorer service.

The biggest winners? The US corporations and hedge funds who fell like vultures on the privatised companies. Oh, and the French state - their power is still significantly state owned, I think 51%. They've been able to save their tax payers money by joining in the profiteering from UK generation - one of the big 6 UK suppliers is EDF: Électricité de France.

Markets require competition. If I have to pay a lawyer thousands of dollars before I can install some solar panels in my back yard and start selling the power to my neighbors then I'm not going to do it, and if the only remaining companies who do are an oligopoly of huge players with the regulators in their pocket then you no longer have a market.

A lot of that is regulatory capture, but the other huge factor is administrative costs. Even if I can do a great job and do everything safely with no danger to anyone -- suppose I'm an electrical engineer -- then I'm still not actually allowed to do it because the rules require an electrician.

We could have simple rules -- don't electrocute people, don't start a fire -- but sometimes it will happen despite our best efforts. Then a bureaucracy doing the work will want to defer blame. A set of regulations allow that. If there is a fire but they followed the regulations, well, they followed the regulations. Not their fault anymore, even though it ought to be. But then every time something bad happens, you get another rule (even if there are five other, possibly better, ways to solve the same problem), until the rules are so complex that only a large bureaucratic entity can follow them. Having destroyed competition, we can now blame the market for the resulting badness.

Hmm, America sounds deeply broken if that's true - we don't need thousands on lawyers for solar installation here. Contact installer, arrange appointment, complete the few bits of paperwork - unless your house has restrictions on works, eg shared property or rental. Planning permission in national park areas is, I think, required.

As for the other, it pays to remind ourselves why we have some of those rules. After years of assorted homes and offices, seeing the horrific electrical or plumbing ideas people have had, most of them are there for a purpose. "Don't electrocute people" isn't nearly enough to get a dim bulb technician to know the right wiring or grounding rating for a particular use, or correct routing, or to prevent corners being cut when the company employing pays them minimum wage or on piecework. Best efforts are regularly compromised as a matter of policy when profit is the key driver. It's an area with clear need for strong regulation, otherwise people die.

As someone who rewired my first house, even the onerous regulation wasn't too bad - do the work, stop at the 80 amp fuse, and get a suitably qualified electrician to check and sign it off before hook up. I forget the costs now, but perhaps pay £200 for the safety check and hookup, but saved £2,000+ for having someone rewire.

The rules are simple. They have to be in order for the semi-interested teen to be adequately taught. No small business or self employed guy need be ruled out. I have a friend who, for developing his business, did a few of these courses a few years back - to get the necessary papers to add additional services. His recollection: Extreme boredom because mostly they try to teach common sense - something vanishingly rare - as a college course, pitched for those who had difficulty with shoelaces.

Sadly some of that is the price to be paid for not killing people with shite wiring or gas plumbing. Deregulation or simplification has a death toll - which is why the rules got writ in the first place. I vote to keep - even if the rules are imperfect as they are 99% common sense. I've seen (and paid to repair or replace) what people do to houses and offices, left to their own devices, more than enough times than to encourage more.

> Deregulation or simplification has a death toll

I agree. Isn't this also what we see with e.g. Boeing 737 Max? Hollowing out the oversight and regulations in favor of the bottom line.

He didn't say it takes a lawyer to install solar panels. Just that it would probably take a lawyer to install them and sell the excess power to your neighbors. I'm guessing the same would be true in the UK.

Utilities are natural monopolies. It's not feasible for every company in the marketplace to build their own water, gas, or electricity distribution network.

There is no evidence of natural monopolies ever actually arising naturally as you're describing. In every instance, government either acted pre-emptively and established a monopoly itself or the monopoly was a result of other government regulations and policies (for instance, patents and copyright).

Do you really want 10 different companies installing power lines, electrical wiring, etc? Also, without a government granted monopoly, private corporations would only compete in the most affluent areas. They wouldn’t offer services at an affordable rate if at all to less dense areas.

Exactly, there may be some play when it comes to internet but that argument does not apply to water, power.

It’s a highly disingenuous argument to say that we’d be better off with a fully private water market.

> Do you really want 10 different companies installing power lines, electrical wiring, etc?

Yeah, that sounds amazing. Do you think there should be zero alternative firms?

> Also, without a government granted monopoly, private corporations would only compete in the most affluent areas.

That's a ridiculous assertion and doesn't apply to any other good. There may be more options for the affluent, but that's not the same thing.

> They wouldn’t offer services at an affordable rate if at all to less dense areas.

And why should they? People should be living efficiently in cities anyways where they're more productive and have less carbon footprint.

Yeah, that sounds amazing. Do you think there should be zero alternative firms

Now imagine a picture of a city with 10 sets of power lines, gas lines, and water lines. Each having to ask for right away to dig up streets and right of way...

That's a ridiculous assertion and doesn't apply to any other good. There may be more options for the affluent, but that's not the same thing.

It’s not an “assertion” it already happens with internet and cable. No one is going out of their way to offer gigabit internet to rural America.

Before, the government forced utility companies to offer service everywhere for phone lines, electricity, and to a lesser extent water.

And why should they? People should be living efficiently in cities anyways where they're more productive and have less carbon footprint.

Right, who needs silly stuff like farms....

Wouldn't it be more efficient and better for the carbon footprint if every human being just killed themselves?

Personally, that sounds like a better option than living in a city.

In the 1980s there were many operating systems for PCs: Commodore had one, Amiga, etc. PCs became important for white-collar work with the result most prospective white-collar workers would learn how to use an OS to make it easier to find a job. Which OS did most of them learn how to use? Well, if you are a prospective software dev in 2019 which version-control software do you learn how to use to make yourself more attractive to prospective employers? git of course -- even if you think Mercurial or Fossil is better -- because git is the one most employers use. And employers will standardize on git partly because that is what their prospective employees are most likely to know. Same thing happened with personal-computer OSes in the 1980s and 1990s with the result that by 1997 Microsoft Windows had 95% or 98% of the market. (Apple was in danger of going out of business in 1997 when Microsoft publicly invested $150 million in Apple stock. Microsoft's motivation here was probably to make Microsoft look less like a monopoly to governments, reporters and voters.)

Is it not possible that this mechanism by which the most popular product is the most attractive one (to prospective employees and employers in our example; in another example it might be people wanting to make phone calls) -- thereby making that product even more popular -- could create what grandparent referred to as a "natural monopoly" even in a completely unregulated market?

You might reply that Microsoft could not have achieved its monopoly without the enforcement of copyright laws by governments. Well, consider an alternative reality in which there is no copyright law, but Windows is distributed only with new PCs and runs inside a cryptographically-secure enclave. In other words, there are purely technical ways to achieve the same business goal that was in actuality achieved by copyright law.

Apple was in danger of going out of business in 1997 when Microsoft publicly invested $150 million in Apple stock. Microsoft's motivation here was probably to make Microsoft look less like a monopoly to governments, reporters and voters

This is apocryphal and not what happened.

At the time that Microsoft invested $150M in Apple, Apple had $4 billion in the bank through loans. Also, Apple turned around and in that same quarter, paid $100 million to buy out Power Computing’s Mac license. Apple also continued to lose money for the next two or three years. The net $50 million wouldn’t have made a difference.

Apple was abnormal among tech companies back then for having a huge cash stockpile. These days, they have billions just because they have too much money to know what to do with. But back in the 90s, they had billions in cash & short term investments even though the whole company was only worth a few billion. Of course, you could argue that meant that the market was very pessimistic about their business and therefore they were very shaky. But they were very different from a typical struggling business that is levered up and has to make the vigorish every month.

> Is it not possible that this mechanism by which the most popular product is the most attractive one (to prospective employees and employers in our example; in another example it might be people wanting to make phone calls) -- thereby making that product even more popular -- could create what grandparent referred to as a "natural monopoly" even in a completely unregulated market?

You must realize that you're describing a free product, right? The way people organize around free things is totally different to something they pay for.

People are incentivized to not pay for bad service when better options exist. And the worse the service or the higher the price, the higher the incentive. Entrepreneurs are incentivized to enter a market under those conditions. The more opportunity they see, the more likely they are to enter the market.

The only way to prevent competition is to provide such good service that there's no room for competition (which I can't see a problem with), or to raise the barrier to entry with state policies.

> You might reply that Microsoft could not have achieved its monopoly without the enforcement of copyright laws by governments. Well, consider an alternative reality in which there is no copyright law, but Windows is distributed only with new PCs and runs inside a cryptographically-secure enclave.

I don't think what you're describing would stop anything, but it sure would make using a computer more onerous and likely push away a lot of customers.

> In other words, there are purely technical ways to achieve the same business goal that was in actuality achieved by copyright law.

There just aren't the same tools available to firms when software can be freely modified and redistributed.

Yeah, and it all starts with calling into a place to be greeted by a horribly inefficient "automated" phone system where you need to spend 10 minutes navigating menus that can't detect voice correctly.

It puts 100% of the burden on the customer to save the company time and it seems every company does it.

I remember spending close to 5 hours 1 day trying to get health insurance where it was just a combination of automated phone options, waiting on hold, being redirected, waiting again, and in the end within 15 seconds of finally getting to a human I was disconnected (I was 100% calm too, they were just asking for my details). And then after thinking "fuck this shit, I'm never buying insurance again" I got the luxury of having to pay over $5,000 in fines for not having health insurance for 2017-2018's tax year.

I don't understand why society puts up with this stuff and unfortunately 1 person can't make a difference.

This is nothing compared to health insurance billing processes in the US. They work damn hard to tell you that you owe something, but the second you pay them they stop trying to make things right.

> If anything, the amount of shadow work foisted on customers has increased. Somehow it's a norm to have to go through a bunch of bullshit to have errors corrected and often just to get halfway decent service. It's obviously worse in industries without meaningful competition, but society in general seems to put up with it and assume that's just the way it is.

Worst offender who does this? US Healthcare

I think this might be the service side of shrinkflation.

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