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Administration on Course to Stifle Innovation and Creativity through Antitrust Laws

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Published: 03Jan2010
Word count: 464
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What happens in America if you become wildly successful? What happens if a product or service of yours becomes so good that so many people want it that becomes the dominant player in the market place?

In some cases the government comes after you to get you to "share the wealth."

This is going on with the Monsanto corporation now. Monsanto is an agricultural company. It helps farmers become successful. When farmers are successful food is delivered to your dinner table.

Essentially, through genetic engineering, Monsanto has developed a technology that allows plants to stand up to and thrive amidst a powerful herbicide. This technology allows farmers to use the weed killer "Roundup" even after the crops have started to come up. This saves the farmers work and enables them to cultivate more land. "Roundup" itself kills just about all weeds and us saves farmers is step of tilling the earth. This makes the cost of producing the crop lower.

Farmers like the new technology that Monsanto produced and they buy it. Monsanto licenses the technology to hundreds of independent seed companies and to its major competitors but apparently that is not enough for some. They want the "heavy hand of the government" to force Monsanto to make its product available to its competitors at a lower price.

One of its competitors, DuPont, argued that "Monsanto has abused its unlawfully acquired monopoly power to block competition, thwart innovation and extract from farmers unjustified price increases of over 100% in recent years."

Unjustified? As measured by who? Who but the buyer of a product has the right to determine whether the product is priced appropriately? And if that buyer believes the product is priced too high the buyer has a choice-don't buy.

This whole approach to successful companies is nuts. Monsanto devoted its own time, energy and money to the development of its product. Others could have chosen to do the same but they did not. Now Monsanto should be allowed to reap the benefit of its hard work. If the price that Monsanto charges for its technology is "too high" then fewer will purchase it and, with demand shrinking, the price will come down. Farmers can, after all, choose to not use its product.

Some group calling itself the "American Antitrust Institute" has, according to press reports, broadened the antitrust case against Monsanto and called for legal enforcement, citing "an almost intractable situation for competition." In other words, you did so well nobody else can beat you, so let's have the government slow you down.

If a company is "rewarded" for innovation and risk-taking by having the government come in and force it to share what it has earned then companies will hesitate to innovate. Innovation, creativity and risk-taking is what America was built on.

BEN GLASS is a Fairfax small business owner and marketing and small business consultant. He runs monthly marketing meetings for Northern Virginia business owners and entrepreneurs. To come to our next meeting for free, and get one of Ben's books, for free, visit www.Glazer-Kennedy-Virginia.com or call 877-IBA-GKIC (877-422-4542)

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