Every actor is looking for a way to avoid market competition. Every time you hear a company discuss building a moat, that is a company that doesn't want to compete in a market and is actively working against the benefits of capitalism. Every time you see a monopoly, it is again a marketplace working against the benefits of capitalism (i.e. market competition).
At all times the government must strongly and actively maintain market competition or capitalism simply eats itself.
I understand the argument you're making, but I don't think these are the words to use to do it, makes it more confusing, and you're glossing over some thorny issues. One could just as easily and more accurately say "power is inherently power centralizing".
I assume you are equating "free-markets" with "laissez-faire" markets which I don't think is accurate, else why would we separate the two concepts? Better to use the term "perfect market capitalism" (essentially markets where no player has the power to affect prices) and then specify market imperfections and failures as the cause of "inherent flaws" and worthy of regulation.
markets don't eat themselves, participants with power eat them.
But we also need to understand the difficulty of regulation. Keeping this brief thru a lot of hand waving and overgeneralization, Microsoft monopolized the personal computer market in the 1990's, and made buckets of money doing it, but they were not able to then leverage that into enduring monopolies in (the internet and) cell phones and cloud services, which together supplanted the personal computer as "what was popular" for personal information and communication. Would an evolving government regulatory regime applied to Microsoft have been able to create a better outcome in the same time frame without stifling industry than did what Schumpeter called the "creative destruction" of progress through free market forces? (yes I could word that more and better, but I want to hit reply and be done, so hopefully my point is not lost.)
When you talk about "free markets" failing, you feed the idea that socialism is a good idea, which is a serious baby/bathwater problem. Better that people learn more about perfect markets.
"Power is inherently power centralizing" - we both agree that that is the fundamental issue.
"Laissez-faire" in any practical sense is worthless. No-one should reasonably in this day an age be advocating for essentially anarcho-capitalism or an adjacent laissez-faire derivative thereof. People do, I think it's incredibly naive - but you appear to be in agreement so we'll move on. We expect any form of state sponsored capitalism to enforce it's main benefits (of which I argue one of the most important keys is actual market competition).
> market's don't eat themselves, participants with power eat them.
Yes and the default state of any market is for there to be power imbalances. (it's almost impossible to have markets without them). And since power imbalances are in practice inherent in markets, and participants are what constitute a market, it is correct to say that "markets eat themselves". To contradict this is to either find a market without power imbalances (essentially only exists in theory), or find a market without participants (clearly a market not relevant for our purposes).
Since participants in markets are continuously trying to consume the market there must be a continuous countervailing force to prevent this. That is my thesis.
> When you talk about "free markets" failing, you feed the idea that socialism is a good idea, which is a serious baby/bathwater problem.
This is a terrible line of reasoning. It is essentially a head-in-the-sand defense. Essentially saying we shouldn't talk about the failure of free markets because by acknowledging their shortcomings when people look at all the different possible ways to improve it and one of the says they run across might be socialism. As a result we shouldn't discuss the failures of free markets. The rest of our post is well reasoned even though I disagree - this is not, so I won't spent much more time on it. In no point did I mention socialism, and avoiding discussing failings of a system because people might look to others is a weak way of defending its merits.
> Better that people learn more about perfect markets.
Perfect markets generally are not the state of markets. "Perfect Market Capitalism" is like the "Efficient Market Hypothesis" - its a simplification that makes reasoning much easier, and there are cases where you can apply it. But in practice there is clear, continuous evidence that it does not hold, and ignoring the messy bits is where the system falls apart.
Finally, regarding your PC example I'll saying the following: Ensuring companies are forced to engage in "fair market competition" (avoiding the no true scotsman of perfect market capitalism) by preventing the societal marketplace harming impacts of monopolies, oligopolies, network lock-ins and similar is essential for a healthy society. Any market with power imbalances will tend towards solidification.
We cannot avoid imperfect markets, there will always be transaction costs, barriers to entry, natural network effects. And when there aren't, participants in a market will find ways to introduce them for their benefit. Imperfect markets get more imperfect over time due to the actions of their participants. It is inherent in markets.
So we have two options, immediately address the most imbalanced cases. Or ignore them and hope that the market will become less relevant before the leader has a chance to leverage their position of power. The latter approach is wrong. "Tech" is the only field that moves fast enough for this to even be possible, and you can see from how centralized tech is that even in tech it more often fails than succeeds. Or put another way about regulation: yes you want term limits even if it means a great politician can only have two terms in office instead five, even if they could've done great things in those 5 terms. Because the risks of no term limits is much worse for society. Same reason you want to regulate market dominating companies, even if they could've done great things in that market dominating position, because the risks it brings to a net negative on society are to large.
A simple start is break up market dominant companies and prevent market capturing merges. But fundamentally society must always be vigilant in preventing markets from centralizing power, or from preventing any system from centralizing power. Capitalism (and most systems) centralize power by default. So society must always have a counterbalancing force to get the most benefit from capitalism. Free purely unregulated markets are bad because they centralize power to avoid competition. The goal of society should not be free markets. The main benefit of free markets are market competition. The goal of society should be to maximize market competition (which is different than striving for the impossible goal of perfect markets). And external force needs to act to balance to consolidating nature of free markets to maximize market competition and maximize benefit to society.
We are seeing it happen in real time. Our president is a crook. We have plenty of evidence that he influenced-peddled to foreign countries for millions. Our media lie to us constantly. Most of the government, including the DOJ, FBI, and CIA, are run by corrupt, partisan, and evil people who are largely unaccountable to the public. Our judicial benches are filled with partisan activists who largely ignore the law and the constitution as they make whatever rulings they can to promote their ideologies or world views. Capitalism will not save us from any of this, especially as long as so much of the public keep voting into office people who actively support this kind of corruption.
Give me a break.
With a federally insured bank, securities, or other regulated financial products there's a watchdog ensuring compliance and regulations, transactions are largely traceable and auditable, and if someone finds a way to game the system there's a legal entity with a massive presence that will come down on you anyway.
There are advantages to both, and centralized finance is certainly 'gameable' in ways also, but I definitely wouldn't say that it's more gameable than decentralized finance.
