The Open Market Facts Of Life

The Continent's leaders should know better. They are busily privatizing state-owned monopolies without providing for any real market competition. Worse yet, they are trying to convince themselves and their voters that these half-measures are serving taxpayers' best interests. They couldn't be more wrong.

By protecting corporate heavyweights such as the German phone and postal monopoly from competition even when they are privatized, government officials are arguing that taxpayers will get a much better price from the sell-off. That much is true. But it's the sort of payoff that voters could do without.

The last thing that consumers and job seekers need is for erstwhile state monopolies to be converted into private ones. In the face of global competition Europe is flailing because there is too little--not too much--competition in its economies. The result is high prices, high costs, and no jobs.

Fixing the problem isn't difficult, in theory. Politicians in London and Washington have known for decades that the best way to deal with monopolies is to end them. Companies function more efficiently, grow faster, and ultimately hire more people at higher wages when they compete in an open-market economy. When will European bureaucrats learn that simple economic fact of life?

Before it's here, it's on the Bloomberg Terminal.