The sole source of harmful monopolies is the government, which is the only agency that has the power to force competitors out of business, i.e., it is the only agency that has the power to outlaw (i.e., regulate) competition.

As evidence, witness the United States Post Office, which makes it illegal for anyone to charge less than 34¢ for first class mail (one entrepreneur attempted to compete by charging 5¢ — he did not get far). Other examples include the East India Company of the 17th and 18th centuries, the American Pacific Railroads of the 19th century, and the AMA’s monopoly over the prescription of medicine in the 20th century.

Only the government can physically force competitors out of markets, or establish harmful monopolies through the granting of state franchises. Both actions are a violation of individual rights since such state franchises prevent those who do not have “political pull” to enter the state-regulated industry. State franchises are an insurmountable barrier to entry–a barrier created by the government.

The only “force” a capitalist can use to put his competitors out of business, is the “force” of providing a better product at a lower price as judged by those who purchase his products — such is the “power” of businessmen. If this is how he achieves his monopoly, then it is in no way harmful. Just because something is a “monopoly” — a single agent in a specified area — does not make it evil.

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