Thursday, July 11, 2013

Apple's Conviction: One of the Most Shameful Prosecutions in American History

To the shame of a nation that was founded on the principle of individual rights and the rule of objective law—"a government of laws and not of men"—Apple Inc. was found guilty of "conspiracy" to "fix prices."

What was their "crime?" According to The Los Angelos Times' Alana Semuels:

In a trial that lasted three weeks, federal prosecutor Mark Ryan argued that when it entered the e-book market in April 2010, Apple offered publishers a way to fight back against Amazon by raising the prices of e-books. Prices went up shortly thereafter, and Apple negotiated 30% of the profits.

So??? These companies negotiated voluntary agreements in an effort to maximize their profits through voluntary trade with consumers. No one was forced. There was no guarantee that the higher prices would stick, and be profitable. That they did and were is proof of good business judgement, not criminal behavior. This is called competition in a free market—a free market being a market that is free from physical coercion.

Free, that is, until the government intruded. "The Plaintiffs have shown that Apple conspired to raise the retail price of e-books and that they [presumably consumers] are entitled to injunctive relief. A trial on damages will follow," U.S. District Judge Denise Cote wrote in her opinion. "Apple was a knowing and active member of that conspiracy. Apple not only willingly joined the conspiracy, but also forcefully facilitated it."

But there was no force involved, except in what the government is doing (George Orwell, are you listening?). These were voluntary agreements among the companies. Consumers voluntarily paid for the e-books, and got the e-books they paid for. There was no fraud or force involved. Yet, the government will now forcibly seize money from Apple, under the legalese guise of "injunctive relief" and "damages," and presumable turn it over to consumers who were not harmed in any way, shape, or form. 

No consumer is entitled to any particular "low" price for any product. Producers are not entitled to any particular "higher" price. Prices are set in the market by voluntary agreement of buyers and sellers. Apple did not, and can not, "fix" prices. It offered products for sale at a price it believed would be advantageous to itself. Consumers paid a price that was advantageous to themselves. Apple's judgement prevailed, and the higher prices "stuck." What the government is doing—allegedly on behalf of consumers—is attempting to forcibly override the market and fix prices according to its own whims. If what Apple did was fix prices, then every trade is based on fixed prices, and every business is guilty of it.

The only criminal here is the government. Employing the grotesque premises of antitrust, the government has turned innocent producers into criminals, branding them as "conspirators." This moral and legal inversion is not consistent with a free and just society. It is consistent with tyrannical government.  

Related Reading:

Antitrust Prosecution of Apple is Rotten

Barbara Straniero's Mistaken Understanding of "Free Market"

The Abolition of Antitrust by Gary Hull

3 Things Everyone Needs to Know About the Apple Antitrust Case by Yaron Brook and Don Watkins

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