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Government vs. Business

January 7, 2013 – 6:09 pm

stocksGoogle last week won a fight with the U.S. government over antitrust allegations. The investigation lasted for years and they still have to battle Europe on the same issues.

Have you noticed that governments always attack the most successful companies? Google is just the latest in a long line of antitrust litigation of large companies. Sometimes it’s not over antitrust but the attacks are always continuing. Maybe they are justified but I think that many times they are not.

Years ago IBM was attacked the same way and was being sued for years by our government. The attacks stopped with the invention of the PC which began to take away IBM’s dominance in computing power. The government just dropped their efforts at that point. The biggest break up in modern history for antitrust is AT&T breaking them into a number of telephone companies across the nation. AT&T was a monopoly, one that probably would have been destroyed by the advent of the internet and phone service through computers or with wireless service that dominates the phone industry today.

The point is that many times the government is over zealous in attacking successful companies when free markets usually knock off the dominate players with competition. There will always be a need for oversight but the forces of ‘Creative Destruction’ are not to be denied. (‘Creative Destruction’ is a book all investors should read).

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