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How are they trying to prevent alternatives?
Supporting the status quo as best they can, particularly by not supporting any measures that would lead in the direction away from oil(GM's cancelled electric car, anyone?). Completely understandable from a profit sense.
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You are failing to look at what besides transport and energy the byproducts of the oil industry are used for in your life.
No, I didn't, and some of those may not get replaced by anything for some time. But the bottom line is that fuel is still a major player when it comes to oil sales, enough so that OPEC may no longer be able to monopolize the market as easily without that revenue source, particularly in terms of demand for its product.
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So, technology and innovation may win out, I suppose, but the direction of the advances that we see out of the research sector are hugely influenced -- shaped, even -- by public policy (and hence big business lobbies) and industrial interests.
We are seeing more of that now, certainly, but are you expecting that since it's harder right now to perform basic scientific experiments and make products that are on the cutting edge in one's own garage, that it will never ever be that way again in the future? Remember, just 30-35 years ago Bill Gates began his quest to all but dominate IBM and Apple, and ended up succeeding largely on his own business savvy. I'm not sure if you'd qualify IBM as a monopoly back then, probably not, but they had their ball in their court to understate it.
Given human history, I don't believe it's appropriate to suggest that we will remain at a point where only large corporations with their political influences can afford to change the direction of technological advances.
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The water company and electric companies both quadruple their rates over night. What do the small town residents do? There may be answers for long term recovery, but short term the residents will just have to pay whatever the rates are. The infrastructure of water and electric makes it impossible for a competing company to quicky respond.
Companies big and small already do this, though granted more often to less effect. If you have the best and only product of its kind, you are rewarded for being the first to the punch. That's what drives people to keep finding new sources, and get there first. The water company succeeded, but it's hardly doom for the small town. They'll may be forced to pay those rates for a time, depending on how rapid the response is by the town's entrepreneurial crowd, but in the end that water company runs the risk of being completely overthrown.
Raise rates too high, and they drive themselves out of business because people get upset. That's the beauty of it. In fact, arguably by not having the arbitrary line in the sand you would have a situation where people might be a little more responsive(like they are with OPEC, which we can't really do anything about except bitch and moan, and then eventually use alternative sources). This is because basically, you say 85 percent of the market share is A-OK, so the company who BASICALLY already has a monopoly just retains that 85 percent mark, and the government and people may not even take notice until years of plundering the consumers.
The water company in question simply needs to go with 1.5x or 2x the basic rates, and they can keep going and going and going. Raise em too high, take advantage of your monopolistic position and the populace responds in force. The water company, in essence, has regulated itself because the market would not stand for it.
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Do you see a problem with this statement in regards to a coercive monopoly? Probably not.
No, I don't. There is no question that that's precisely what they're doing. Last I checked, they want to retain their profits. The minute oil companies start promoting electric cars, I will see a problem with my statement =)