Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[Robot Parade Leader]

If the CEO testifying in court isn't evidence, then I don't know what is. The whole thing is about that and the link goes to the issue of them charging too much/that the merger would be bad because of it. Testimony in court featured in a business friendly publication like Forbes isn't good enough
https://www.forbes.com/sites/errolschweizer/2024/09/04/why-a-price-gouging-ban-isnt-so-crazy-after-all/
Bloomberg:
https://www.bloomberg.com/news/articles/2024-08-27/kroger-hiked-milk-egg-prices-above-inflation-merger-judge-told

You know, I suddenly decided I needed to respond to this in detail.

You say yourself, "a business friendly publication like Forbes". Forbes and Bloomberg are the tools of what you consider to be your enemies, are they not? So treat them like tools of your enemies. When they seem to agree with you, it's not because the people in charge of them randomly and uncharacteristically decided to be honest for a change, it's because they're propagandizing you.

Why are they propagandizing you? To provide support for the idea of grocery store price caps, which nearly every economist agrees is terrible. Why might they want to do this? Well, for one thing, we can just look at discussion right in this thread to see an idea —

We've been over this more than once. "Pool your money and start a competitor" doesn't work when you're up against well-established companies that have massive resoures and existing logistical networks. Kroger can literally afford to put a new store on every approach to yours so that it will always be more convenient to stop there, and have enough supply strength to undercut any price you put up. That's exactly how they got so big in the first place.

Where do you usually pay higher prices, at a chain store or a locally owned store? It sounds like you haven't checked, but as much as Kroger hiked up those prices, local stores have generally hiked them up even more. So price caps come in, which store goes out of business first? It's not the one with massive resources and existing logistical networks, let me tell you.

Forbes and Bloomberg haven't seen the light on price caps because of a very specific socialist epiphany, they've seen the light that price caps can be good for the bottom line.

It's not clear why you "suddenly decided" that you "needed to respond." There is nothing forcing you to respond and no "need." If you want to that's your choice. I don't know where you're getting any of these ideas or why you believe what you are doing is effective. It isn't. "Enemies" is way too broad. I've cited several examples of corporations doing bad things and there are absolutely tons out there. They're wrong and there's a better way that has been historically proven under the most stressful conditions imaginable, while theirs has failed and been repeatedly rescued by that better way. However, the idea of socialism in the U.S. has been beaten to death and censored for so long that talking about it is unbelievable heresy and blasphemy to many. https://en.wikipedia.org/wiki/Joseph_McCarthy Never forget they added the phrase "under god" to the Pledge of Allegiance in 1952 because they couldn't stand the idea of socialism for ... whatever reason they called it "godless communism." There are differences of opinion, and mine is well founded and cited. You realize neither one of us is going to convince the other, right? Europe has socialist stuff https://en.wikipedia.org/wiki/Social_democracy They have socialized healthcare and all sorts of things like that and it works. Even if they have some capitalist businesses too, you know nationalized universal healthcare in the US would be screamed down as "socialist."

1 People cite the opposite viewpoint to understand it. Bloomberg and Forbes are friendly to the opposite view and even they are forced to admit it, because it was testified to in court. This is kind of like how Fox news was forced to agree Dominion voting machines were absolutely and completely not tampered with and not repeat trumps election lies when they got sued the daylights out of.
https://en.wikipedia.org/wiki/Dominion_Voting_Systems_v._Fox_News_Network
"Fox News agreed to pay Dominion $787.5 million and acknowledged the court's earlier ruling that Fox had broadcast false statements about Dominion." I understand propaganda. This isn't propaganda and it isn't good for their bottom line. It is something that a CEO was forced to admit in a court proceeding. 

More to the point, and please pay attention here: ***** TESTIMONY UNDER OATH in a court proceeding. ***** This is critical and I think you're somehow missing it by focusing on the fact that Bloomberg and Forbes cited it. The testimony is what the CEO was forced to admit under oath in court proceedings.

2 You are twisting words I didn't say. You want me to have gone to universal price caps rather than targeted corrective action against Kroger, because that somehow is perceived as a better argument to you? The article said, "Why A Price Gouging Ban Isn’t So Crazy After All." https://www.forbes.com/sites/errolschweizer/2024/09/04/why-a-price-gouging-ban-isnt-so-crazy-after-all/

I pointed to the fact that the U.S. Federal government was unquestionably a better manager than the private sector during world war II. This was socialism absolutely working when capitalism absolutely failed in the great depression. FDR was without a doubt a fantastic socialist president and saved the country by defeating the great depression and actual Hitler while winning reelction so many times the republicans had to limit the US President to two terms to have any chance. 
http://www.bay12forums.com/smf/index.php?topic=162538.msg8556833#msg8556833

And at the end of the day, when all the BS comes off and stuff goes sideways, if a major war breaks out like world war III, the US federal government/military can and will seize control the same way they did in World War II (Including re-instituting a military draft which all males are required to register for to this day) and / or through the defense production act
https://en.wikipedia.org/wiki/Defense_Production_Act_of_1950

When it all goes sideways, Uncle Sam steps in and informs the private sector (which fails) how to do it the right way. The same thing happened with the bailouts after the financial crash in 2008

https://home.treasury.gov/data/troubled-asset-relief-program

"Treasury established several programs under TARP to help stabilize the U.S. financial system, restart economic growth, and prevent avoidable foreclosures."

Translation, when capitalism ultimately fails, it turns to the government and socialism (but only for the rich) to bail things out. Why? Because the Banks were "too big to fail." So if any of us fail we are just screwed but if the banks fail we have to rescue them or they will take the whole country (or countries) and economy (or economies) down with them. If your corporation is too big to fail, then it is too big to exist.

This wasn't about "price caps," this was about "price gouging" and that is illegal and why the government is stepping in. It is about the bad risks capitalists are able to take only because of corporate structure with the government there to bail them out if they fail. If they tank the grocery market like they did housing then the government would have to step in there too.

3 What that testimony really was did not go to price caps but improper market cornering and unfair illegal business practices. The FTC is upset about that and suing them about it and the merger. Kroger is  getting into market cornering territory. This is what happens when corporate things are allowed to get too big. There's a whole reason why this going toward monopoly and unfair market cornering is illegal and raises prices without any real reason except greed and gouging. https://www.investopedia.com/terms/m/monopoly.asp

4 Price gouging is bad. I don't care what you call it. There needs to be something to reign in bad things like that. 

Where do you usually pay higher prices, at a chain store or a locally owned store? It sounds like you haven't checked, but as much as Kroger hiked up those prices, local stores have generally hiked them up even more. So price caps come in, which store goes out of business first? It's not the one with massive resources and existing logistical networks, let me tell you.

I don't understand why you assume Lord Shonus hasn't checked or doesn't get it. I don't understand why you seem to be saying that about him, because it doesn't fit and it isn't fair or nice to him. Speaking of checking, do you have any evidence for what you're saying? You seem to be saying "price caps," (like you appear to think some blanket thing applying generally) but nobody is really talking about those. It's price gouging that's the problem and the remedy for that would be to hit the big stores who are price gouging rather than the little ones. So even if what you're saying is true, (and it does not seem to be) then there's saying any restrictions would be universal and even touch the smaller stores. The little locally owned stores don't necessarily have to be impacted at all if the big stores get hit by a court so it isn't clear why you seem to be saying that.

The FTC isn't suing the little local store, because they're suing Kroger instead. The little local store isn't the problem Kroger is and that's why Kroger is getting sued and the little local store is not.


I don't know why you decided you "needed" this but I guess if you want to whatever. You look at the opposition to understand it. That wasn't propaganda it was testimony a CEO was forced to give in a court matter. Price gouging and price caps are not the same. Kroger is getting sued because it was price gouging and a merger would make it worse. The local little store isn't getting sued because it didn't price gouge. Nothing to do with anything we are talking about will impact the little local store(s), because they aren't getting sued for price gouging. Also, I don't get why Max seems to think Lord Shonus hasn't checked on grocery prices or doesn't get it, because Lord Shonus seems to make sense.

I don't wanna live in a world where eggs can just shoot up to $12 a dozen randomly because a corporate jerk decided they wanted more money and didn't care what the market thought or any reason. That's price gouging and it's wrong.

[hector13]

Pretty sure MS is talking about price caps because that’s one of the ways that stops price gouging, usually tied to inflation.

Reasonably sure the UK energy market for consumers has price caps, which I think caused a handful of smaller energy providers in the UK to fold around the time of Russia’s invasion of Ukraine because they were unable to recoup the costs of the fuel they used to make because the fuel cost more than the cap.

Price caps aren’t the only way to control price gouging, but it’s probably the easiest to enact.

Edit: also the “in God we trust” or whatever it was, was added to the pledge because the Communist USSR was quite strong on the atheism, and put it in as further example of Communism is Bad^TM and we’re better than them Reds.

[McTraveller]

"Capitalism" nor "socialism" alone will "save us"; we actually do need a combination of both.

The example of egg price gouging is an interesting small case study, but doesn't really apply to entire economies.  A company can't sustain pricing eggs at $14/dozen; first of all eggs are not necessities and so can easily be substituted, so raising eggs to $14 is going to kill the demand.  If the company tries to keep the price high too long, the eggs won't sell and they will spoil, meaning the company will lose whatever they spent on the eggs.  This is a self-correcting situation.  The only way this would not self correct is if somehow one company (or collusion) controls all eggs and egg substitutes.

As for social programs, they don't work "better"; they work "differently."  Consider the differences in "health care outcome" statistics, per-capita spending on health care (spending divided by population), things like average wait times, and median funding level (tax or premium payment per paying entity), distribution of revenues to practitioners vs other staff/entities.

One of the problems with health care (and any other "insurance" industry) in the US is that the suppliers are getting paid from the entire possible pool of customers for services given to a subset of those potential customers.  This distorts the pricing signal such that prices are much higher than they would be if the people needing services paid for it individually.  Socialized medicine does not solve this "intermediary" problem; the customer of health care services is still not the entity directly paying for the services.  While single-payer does have the advantage of being able to combat some provider-monopolistic tendencies, single payer doesn't do much to be able to respond quickly to changes in demand.

So really you just need regulation in terms of balancing system stability with the ability to change quickly and foster innovation.  The notion that a private vs public entity is "better" at doing this, is irrelevant; the public is just as capable of acting horribly as private entities.

[Maximum Spin]

Pretty sure MS is talking about price caps because that’s one of the ways that stops price gouging, usually tied to inflation.

I'm talking about price caps because they're actively being debated in American politics right now, and are the policy behind the "price gouging ban" Forbes and Bloomberg decided was a good idea (because it benefits them), yeah.

ETA:

Reasonably sure the UK energy market for consumers has price caps, which I think caused a handful of smaller energy providers in the UK to fold around the time of Russia’s invasion of Ukraine because they were unable to recoup the costs of the fuel they used to make because the fuel cost more than the cap.

This is what happens, yeah, and the purpose of a policy is what it does. The theory explaining why "price gouging bans" lead to the death of smaller companies, not larger ones, and subsequent centralization has been known for 200 years, big business and their supporters know about it, they do it on purpose.

[Robot Parade Leader]

"Capitalism" nor "socialism" alone will "save us"; we actually do need a combination of both.

The example of egg price gouging is an interesting small case study, but doesn't really apply to entire economies.  A company can't sustain pricing eggs at $14/dozen; first of all eggs are not necessities and so can easily be substituted, so raising eggs to $14 is going to kill the demand.  If the company tries to keep the price high too long, the eggs won't sell and they will spoil, meaning the company will lose whatever they spent on the eggs.  This is a self-correcting situation.  The only way this would not self correct is if somehow one company (or collusion) controls all eggs and egg substitutes.

As for social programs, they don't work "better"; they work "differently."  Consider the differences in "health care outcome" statistics, per-capita spending on health care (spending divided by population), things like average wait times, and median funding level (tax or premium payment per paying entity), distribution of revenues to practitioners vs other staff/entities.

One of the problems with health care (and any other "insurance" industry) in the US is that the suppliers are getting paid from the entire possible pool of customers for services given to a subset of those potential customers.  This distorts the pricing signal such that prices are much higher than they would be if the people needing services paid for it individually.  Socialized medicine does not solve this "intermediary" problem; the customer of health care services is still not the entity directly paying for the services.  While single-payer does have the advantage of being able to combat some provider-monopolistic tendencies, single payer doesn't do much to be able to respond quickly to changes in demand.

So really you just need regulation in terms of balancing system stability with the ability to change quickly and foster innovation.  The notion that a private vs public entity is "better" at doing this, is irrelevant; the public is just as capable of acting horribly as private entities.

At least you have a more fairly reasonable approach.

I think people confuse markets with this just uncontrolled capitalism thing and the idea that anything will self correct. I'm sorry but I either don't buy that or the "self correction" can be horrible. Much like climate change will self correct. The planet will adjust but we might not. The market might or might not adjust but we might not (or enough people might not where it is horrible).

Yeah, they might not be able to get away with trying to sell for $14 per dozen or whatever the market price gouge is forever. No one should be allowed to at all. The whole point of a market is you trade things for other things and price gouging messes up the system. It doesn't have to be permanent to be a bad thing. I think Kroger kind of does (or could) control all the egg substitues and that's why the government is stepping in and does not want them to merge with Albertsons.

If the whole grocery store raises the prices on everything then what are you gonna do? The grocery store has all the food things in it and the point is that they are a private company gobbling up competition so they can corner all the grocery market or as much of it as they can to get as close to a monopoly as they can. If they buy out all the other stores or "merge with" them and they then jack up or gouge the prices then what?

Your second point calls social programs "different" not "better." There's room for difference of opinion and it is subjective, but I'm looking at the US healthcare system and it is a train wreck. Tons of people still have medical bankruptcy.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6366487/
https://www.texastribune.org/2022/06/16/americans-medical-debt/

Medical Bills account for 40% of bankruptcies.
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1127305/

I'm sorry but I have to say that's just terrible. This could be stuff people need to live. Nobody should have to go bankrupt for that. I just think not having medical bankruptcy is better, because you shouldn't have to lose everything or whatever.

I don't think your intermediary problem is clear, or at least I'm not getting it from the text. "Respond quickly to changes in demand?" I'm not following you so could you help me get that with healthcare in your argument? The idea is you make as many doctors and nurses as possible and set up infrastructure. I don't get how private anything can make that work better than an entire government. I'm not getting how the US private healthcare system is seen as good or even passing this test.

I'm all for regulation. I just think I want more of it than many do and lately there's been a real push to get rid of all regulation or as close to that as possible.

[McTraveller]

I think where we might be in disagreement is the absolutism I hear in the statement "They shouldn't be allowed to set prices to whatever they want."  The disagreement is - who, then, sets prices? How does a "government" know what a price should be, any better than a company, or better than people buying goods, or better than people making the goods that are sold?

I would be in favor of mechanisms that help prevent abuse but don't amount to arbitrary price floors or caps.  Something theoretically like if your revenue increases faster than twice inflation, or you are selling goods for less than a discount based on time since manufacture (e.g. if you've had goods sitting in inventory for a long time you don't get penalized for selling "at a loss", but if you have new inventory and you sell low, you do get penalized), you get taxed or can't claim as much loss.

Put another way: I agree with the goals, but I do not believe many of the proposed policies would achieve those goals and in many cases would work against them.

If you want to have a price cap or price floor, what you do is have the government be the seller of last resort (for caps) and buyer of last resort (for floors).  Kind of the like the strategic petroleum reserve, but with "everything."  This way you can actually balance supply and demand, which you can't do by simply declaring a max price / min price, because those declarations don't do anything for supply and demand - at least not in any kind of reasonable time frame.

Remember that most price shocks are very transient - maybe a couple years at the most, due to things like COVID or rebuilding after a hurricane.  Most shocks are very transient, like a few weeks, if a factory gets shut down or something.

Many of the problems with US health care are due to regulatory capture; it is indeed "almost impossible" to start a new health care business.  The government can't "make as many doctors and nurses as possible and set up infrastructure" fast enough to make any kind of difference; and it can't encourage people to start becoming doctors without paying them more than whatever it is they are choosing to do instead, unless you are suggesting something like "a medical draft" or using tax dollars to pay people even more than the already high rates for medical personnel.  There is some argument for having spare medical infrastructure capacity, but there is a question about how much spare is good; many medical facilities have very little spare which is bad (see COVID), but having probably 50% spare is a lot of extra maintenance cost to bear.

It's sadly not as simple as merely saying "stop people from being jerks."  You can't wave a magic wand or write a law to stop that.  And if you make the laws so egregious that people are "afraid" to do anything, then you have created a nice fear-based state.  Ruling by fear and punishment is not a place I want to be.  That is - guardrails, not guards.

[Maximum Spin]

Here's a related point in the form of a quiz:

Most hated man in America and epitome of the evil rich, Elon Musk, is:

A) a Kroger-like grocery chain owner who made billions by raising the price of groceries a few percentage points over cost, OR
B) the beneficiary of massive government contracts and subsidies?

[Doomblade187]

Here's a related point in the form of a quiz:

Most hated man in America and epitome of the evil rich, Elon Musk, is:

A) a Kroger-like grocery chain owner who made billions by raising the price of groceries a few percentage points over cost, OR
B) the beneficiary of massive government contracts and subsidies?

I genuinely don't know what you're trying to get at with this, please elaborate.

[Maximum Spin]

I genuinely don't know what you're trying to get at with this, please elaborate.

Elon Musk gets his money from the government, to the tune of billions of dollars in subsidies and contracts. Kroger is 99% publically owned, its CEO is a millionaire but not a billionaire, he can't afford to buy any politicians. Elon Musk can. The real money is in government grift. Handing over power to the government to control more of the economy without serious thought about who gets to exercise those powers for what purpose is a recipe for more elite ownership, not less.

[Lord Shonus]

Very, very little of Musk's immense on-paper wealth comes from government subsidies and contracts. Those absolutely form a big part of Tesla and SpaceX's business, but Musk's wealth is in stock. If that stock were actually valued based on the assets of a small-scale carmaker (most automotive marks (not companies) sell as many vehicles in a quarter than Tesla does in a year) and an aerospace technology that spends almost as much money as it makes (SpaceX does big business, but it is an inherently expensive field of work and nearly everything is getting plowed into extremely risky R&D), they'd be a third the value at best. The huge stock price for Tesla that forms the vast majority of Musk's wealth is due entirely to the cult of personality Musk developed as a Visionary (most of the stuff he's taken credit for wasn't that revolutionary and wasn't entirely his idea in the first place - he just had incredible luck to hit the exact notes at the right time) and The Savior Of Mankind (which is nonsense).

[Maximum Spin]

That's missing the point, though. When you buy Tesla stock, you're paying for the presumption that Musk will continue to get massive amounts of money from the government, basically. It's true that, as a non-dividend-paying stock, TSLA's valuation is essentially self-perpetuating, but the entire Musk personality cult is based on his established business model of pulling down government subsidies.

[Lord Shonus]

No, his entire business model is based on presenting himself as A God Of Tech And Science. If "continuing to get government money" had even the slightest impact on the value the stock would be lower because then it would have a connection (however slight) to objective reality instead of Musk's Tech Messiah image.

[Doomblade187]

I genuinely don't know what you're trying to get at with this, please elaborate.

Elon Musk gets his money from the government, to the tune of billions of dollars in subsidies and contracts. Kroger is 99% publically owned, its CEO is a millionaire but not a billionaire, he can't afford to buy any politicians. Elon Musk can. The real money is in government grift. Handing over power to the government to control more of the economy without serious thought about who gets to exercise those powers for what purpose is a recipe for more elite ownership, not less.

The kroger ceo can absolutely afford to buy politicians, but it's also not important if he personally can. *The company does for itself*. It's never one bad actor, it's a whole system of capitalist regulatory capture and lobbying.

And guess what, musk profiting off of government welfare doesn't mean that the government shouldn't control more things, it just means that the agencies in charge should have actual corruption laws in place. But honestly speaking, a corrupt and nationalized economy sector would probably still be more efficient than whatever the current system is. (SEE ALSO THE TRAINS)

Oh yeah elon stock prices are entirely pr lol.

[McTraveller]

This just popped up in my feed, and apparently the answer to are we running out of sand? is "no, not really."

The reason is basically: we can make sand, and to any specification you'd like. More importantly, though, you can also change other parameters - notably, water to cement ratio is more important than sand type for strength.  So unless you qualify it as "we are running out of sand for concrete at a given cost" then you're just being misleading.

(Practical Engineering is a great channel! He covers not just the tech, but also the other aspects; in this video he does talk about externalities and other tradeoffs and the business impact of concrete.)

[Frumple]

There's... fairly similar things going on with basically everything we're "running out" of, iirc. There's not much that's actually scarce, resource wise, it's just a matter of scarce in easily accessible venues.

Does mean that, functionally, we're running out of some stuff because past a point most usage is going to be too expensive to continue at scale (the resource that can't be accessed by or otherwise benefit 99% of the population might as well not exist, really), but that's somewhat different than the clickbait takes present it as, yes, heh.