2017-05-14 —

Tech companies now sit atop a virtual toll booth and impose a charge on a myriad of transactions. Like water and power companies, they have monopolies, although these monopolies are driven by the price of infrastructure and the network effect.


I do not believe that regulation or anti-monopoly action is much of a solution to the problem, although it might mitigate some of the baneful effects of the tech monopoly. The trouble is that the United States is still coasting on the impact of inventions first made practical in the 1960s and 1970s: mass-produced integrated circuits, inexpensive lasers, light-emitting diodes, and the Internet itself (a latecomer in 1983).

The rise of Microsoft, Google, Apple and Facebook could not have been anticipated 40 years ago, even after the building-blocks were already on the market. We have yet to invent the next generation of technologies that will displace the existing monopolies. And until we make concerted effort to do so, the American economy will languish in the sort of stasis that the options markets reflect.

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