As of the date of this post, it’s been a week since President Biden delivered the State of the Union Address to a joint session of Congress. While I have an interest in just about all of the points made in the speech, something in particular struck a chord…
“Capitalism, without competition, is not capitalism. It’s extortion. It’s exploitation.”
Without going into agreement or not with every point of the speech, this particular statement on the context of capitalism and competition is worth exploring. Amongst his points on the topic, the President spoke particularly on how hearing aid costs dropped after competitors were allowed to offer over-the-counter hearing options for U.S. consumers. Astute readers of this blog will recall how competition may be the solution to lower drug prices; the post references a Chicago Booth report that details how generic drug prices dropped significantly when a new manufacturer started producing the same drug, despite an antitrust lawsuit brought on by multiple states and the feds.
One bipartisan result of a focus on competition in capitalism could be new controls on big tech. A bill circulating Congress would prevent tech companies from preferencing their own products over competitors that have to use their platforms to reach customers, and another would open online marketplaces to new competitors.
There’s even talk about how innovation in the world of search is leading to new competition. What are your thoughts on the relationship between competition and capitalism? How about how competition drives innovation? Or is it sometimes the innovation that drives competition? Let me know- Click here to send me an email! I’ve also included a link to the State of the Union address for those who would like to see it.
~ Brian Kasal- The Leadership Matrix
Click here- President Biden’s State of the Union Address
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P.S.- Did you see my last Leadership Matrix post? Beyond the Use of Artificial Intelligence for Homework