@Alex Willemyns and @Stephen Stockwell: I’ll write one final response and then leave you guys to continue, or not.

Alex, you’ve hit the nail on the head by asking these two questions:

• “Is not therefore the aim of Government regulation to keep the Government (or more specifically, the 51% of the tribe from where its monopoly of force is derived from) happy, only?”
• “Can a cell of our environment — an individual — therefore be stunted from growth or killed, if such contributes to making the Government, i.e. 51% of the tribe, happy?”

The government’s aim is to still be the government following the next election. Indirectly, that means it needs to keep 51% of the tribe happy. Or, more accurately, it needs to maintain the happiness of sufficient tribe members in marginal electorates to ensure victory.

Sometimes that happiness is indeed maintained by injuring some of the tribe. David Hicks, say, or Dr Mohammed Haneef or “the dole bludgers” or whoever is bogeyman du jour. I agree that such injury is immoral.

Stephen, you’ve used the term “level playing field” in the sense of “reducing the power of the big entities versus the small ones”. Alex would doubtless argue that “level” means applying the same rules to everyone regardless of size. Who is right? Both and neither — because it all depends on the aims of the gardener of the economy.

eBay is “big”. “So what?”, one could ask. It started small, but through successful strategy it grew until it was a major entity in the global economy. Good on it! Google started with two young guys, as did Apple and Microsoft. Good on them. Why “punish” them for evolving successfully?

Perhaps, instead, natural selection should “punish” the myriad little eBay sellers who were stupid enough to rely on one source of finding buyers, or of failing to hedge their business model against a possible rise in costs. They evolved (poorly) to fit a specific niche in the business ecology — the niche changes, they can’t adapt, they die. Charles Darwin nods knowingly and strokes his beard.

You know, over recent years I’ve become less sympathetic to the rhetoric of protecting the poor, weak little guys.

Sure, all sorts of rights we now take for granted were wrested from warlords, kings and presidents only through long and often bloody warfare. Nevertheless, at least in countries like Australia, we all now have access to education and the global information of the Internet. The playing field is pretty level — if only the “poor little guys” got off their arses and tried to improve their lot instead of just whinging about it.

Several thousand eBay Australia sellers complained on a petition that they didn’t like the changes. They could instead have chucked in $200 each and used the resulting $500,000 to start their own marketplace. But they didn’t.

There is indeed the question of whether corporations and humans should have to play by the same rules in the economy. That’s a complex argument. Nevertheless, corporations are ultimately owned by humans, some rich and some less so — so it all comes down to humans in the end. Why do the humans who had the foresight to buy eBay shares have to suffer at the expense of those who sat and waited for someone else to provide them with the means to earn a living?

I often wonder this when I see miners’ unions protesting the closure of a coal mine. Is that really all those workers are capable of doing: digging coal out of the ground? Are they really that stupid? I’d have thought the ability to operate heavy earthmoving machinery, or to organise workers, would be skills in demand elsewhere — in other kinds of mines, if not in the construction industry.

But there I’ll leave it for today…

Legal type I am not, but if nine tenths of the law is supposed to be ownership (property) then surely the other tenth is fairness. And that’s clearly where the Trade Practices Act comes in — the bedrock of commercial law in this country and essentially the only lifeline individual consumers have to fairness in the marketplace. The Act is there precisely to address the grossly unlevel playing field between the individual on one hand and the business entity with its vastly superior resources on the other.

I don’t think eBay is evil either, Stil, I just think they should adhere to the Act like everyone else. What had me aghast was Alex’s open contempt for that same, very well reasoned slab of legislation.

@Alex: I’m sorry about the ‘pony rides’ remark. That was a bit rough and uncalled for. (Were it not for that, though, simply referring to your age isn’t treating you like a kid.)

However, it’s quite disingenuous of you to claim you’re using a term so politically and historically loaded as the masses in a purely innocent, un-sneering way when your context is a tirade against the consumer protection laws and a glorification of capitalism. You can’t act like a class warrior and play dumb to semantics at the same time.

And of course you didn’t claim the masses were stupid, whingeing or faceless. It was a interpretive description of what I read between the lines of your post. You may not have actually said those words, but if I read that as being the spirit of your sensibilities, then that’s how I’ll call it. And I think anyone reading this blog would recognise the difference. Disagree with my interpretation as you please.

You’re also still having trouble with the nature of modern marketing practices. When I say ’stick the knife in’, it means nothing nastier than what’s always been perfectly legal in all liberal democracies. Making your product more ‘beneficial to society’ has almost nothing to do with market success. Indeed the opposite is often true; just look at Coca-Cola. As for making your product more ‘enticing’…well, enticement only occurs if your prospect is not enticed by one of your competitors’ products more. Especially since most markets are mature markets where any growth has to come out of someone else’s piece of the pie. So in that reality, how are you going to succeed without mounting some form of attack? Not sabotaging the means of production, not killing the staff — undermining the brand with attack, flanking or guerilla strategies (only the leader can defend). If you’ve still got any problems, I suggest you pick up Reis & Trout’s Marketing Warfare. You’ll love it.

And finally, if you’re upset about being compared with John Howard, you might want to stop banging on about ‘choice’ in absolutist terms as if there’ll always be a better option for all consumers to turn to. It’s a fraudulent argument. And if you’re upset about comparisons with Bill O’Reilly, then you ought to stop insisting that the interests, dare I say ‘rights’, of anyone not on your side (ie: without something to sell) are irrelevant.

Call my rhetoric what you like, Alex, but those associations are there to be made. If you disagree, then just refute them. But don’t order me not to make my case that way. If these are your politics, then you’re just going to have to cope with the company you’re in. I might find your rhetoric long-winded, pompous and better suited behind the locked doors of a business management seminar, but that’s fine; that’s your style, it’s who you are. I’ll deal with it. Similarly, I think you’ll be just fine in coping with mine.

Eugenics is the perfect analogy of competition laws. Gardening is a fine analogy also; in a garden, a regulator regulates as they see most aesthetically pleasing. This is subjective, but it doesn’t matter in such a case: the only aim of the regulation is to please the regulator – the gardener. As long as the regulator is happy, the aim of the garden is fulfilled, i.e. in such a case, regulation is positive. Therein lays the guts of the analogy.

Let’s apply it to reality: to our society, and its economy. The Government regulates the society as they see most societally pleasing. Like above, this is subjective. Above, such subjectivity did not matter: the aim of the gardening was to keep the gardener happy, only. Is not therefore the aim of Government regulation to keep the Government (or more specifically, the 51% of the tribe from where its monopoly of force is derived from) happy, only?

In the garden, a cell of the environment – a plant – could morally be stunted from growth or killed, if such contributed to the aim of keeping the gardener happy. Can a cell of our environment – an individual – therefore be stunted from growth or killed, if such contributes to making the Government, i.e. 51% of the tribe, happy?

The key question in this wider philosophical debate is therefore: “Does the majority have the moral right, if it is in their interests, to repress the minority – the smallest minority there is, the individual?” No, I believe that is immoral: it conflicts with my principles of equality, liberty and my belief in each human being’s right to exist without the threat of force coming from another.

If your analogy and my elaboration are applicable to reality (and I live every day of my life to do nothing more than to apply to reality the principles I’ve defined for myself), these are the questions that must be asked of any person who advocates ‘regulation of competition’ (which is by definition, an oxymoron.)

From interpreting reality, it can be seen that humans are great – the greatest things to have ever had a presence on Earth. We are creatures able to take two things which can harm us: a thunder storm and fire, synthesize a solution, and not only fix the problem, but turn the problem into something brilliant for ourselves: reading in front of a fireplace as a thunder storm rages outside. It is further true that humans become even greater when we interact. As such, interaction, or ‘society’, is important if we wish to become greater and greater as a whole (’ human beings’.) The economy is how we interact, by exchanging and creating value with each other. My argument is that we must ensure that how we interact is moral, i.e. our economy must be moral, and law must only exist which ensures such. Moral interaction is interaction without force. One type of human interaction which is immoral is slave labour; this entails the use of force to obtain value from another person. On the other hand, one type which is moral is voluntary labour, which of course entails the use of consent between parties to obtain value from each other. The difference between the two is that in the first case, force is involved.

I cannot argue further. While I thoroughly enjoy this discussion, we disagree on too much; I’d have to write a book to properly reply to what you said. I believe we disagree on fundamental points. I disagree that we live in a Capitalist society; if we did, we’d have full liberty; it would be a moral society. However, we lived in a mixed-economy, as Socialist as it is Capitalist. That is as immoral as being completely Socialist: being half moral is as good as being immoral.

Anyway, to answer your easy question first… Yes, you really can replicate an existing model fairly easily with a few programmers, for certain values of “easy” and “few”.

A copycat will always have a simpler task than the originator, simply because the hard work of figuring out what to do is already done. After that it’s “just” coding. That said, for something on the global scale of eBay you need to program robustly and with the ability to scale massively. That’s a systems architecture issue as well — although these are known and solved engineering problems. You “just” hire appropriately skilled people and do it.

From there on it’s marketing and trust-building. On the basis of eBay’s recent efforts, just saying you’re cheaper, offering a choice of payment methods and publishing an open and transparent dispute resolution procedure would be a huge leg-up. After that, just throw money at it.

eBay currently has 13,200 employees globally, but I don’t know what proportion are technical or even programmers. That sounds big, and it is. But one needn’t compete with eBay as a global entity. Sellers will often want buyers only in the same country, or the same city even. Maybe a myriad of more local eBay competitors is a possibility. After all, we still have local shops as well as megastores.

I wonder if anyone will be nimble enough to capitalise on eBay’s perceived failings?

@Alex Willemyns and @Stephen Stockwell: No need for anyone to apologise for lengthy comments, provided they’re well-argued and moderately polite. Heck, it’s all search engine magnet material for me.

Alex, I’ll paraphrase some of your argument using that oft-abused metaphor of business ecology, because I think that here it’s actually appropriate…

In any ecosystem, there’s a mix of a few big players like eBay and Amazon and Google, a Long Tail of tiny entities which exist in enormous numbers such as individual human beings and solo businesses, and everything in between. Each has adopted a particular strategy for its survival.

eBay is attempting to increase its profits through its ownership of PayPal. Other entities in the ecology, eBay’s legion of small sellers, are reacting against that — but they in turn make their own decisions about their survival strategy, whether to stay with eBay or move to another venue. eBay is betting that enough will stay, at the higher price, to make this a good choice.

In this metaphor, Alex, you’re saying that evolution through natural selection should be left to take its course. Any attempts to interfere, to favour one species over any other, is immoral. It’s akin to, say, Eugenics — if that’s not an overly emotion-laden word. Perhaps better words are “gardening” or “husbandry”, where the ecosystem is managed in order to achieve externally-specified goals, as opposed to leaving it as a wilderness with no specific goal in mind — well, unless you have a god or gods and They have Their Mysterious Goals for the wilderness.

Stephen, then, is observing that one entity, eBay, has grown very large and that its behaviour has enormous influence. He argues that eBay’s behaviour should be restricted because it is affecting the health of other, smaller, entities.

[Have I got that right, Stephen? Once I remove the more emotive appeals from your argument, I'm finding a few logical fallacies that render it... disjointed. One, for example, is that Alex says that when you innovate you make enemies as part of the process, whereas you (incorrectly) paraphrase that as "Making enemies... is innovative".]

Stephen you’re arguing, I think, that “fairness” is about protecting the little guys from the big guys’ actions which may damage them. Alex is arguing that fairness is about the same rules applying to everyone, big or small. Stephen is arguing that eBay’s actions could be breaking the Trade Practices Act, and are therefore wrong. Alex is arguing that the Trade Practices Act is what’s wrong here.

Actually, Stephen, I think you may be reading into my critique of eBay more than is there. I don’t think eBay is doing anything evil. I think they’re making poor business decisions. eBay reckons it can sell this idea of PayPal-only and make more profit. I, however, think that they already have a reputation for being expensive, opaque and unresponsive, and that by additionally being seen as even more expensive, less flexible and associated with words like “ACCC investigation” they’re making the wrong decision — wrong by their shareholders.

Maybe I’m wrong. After all, if eBay’s management is competent they will have modelled this and be sure of their actions. If I were a shareholder, I would certainly want to know if this modelling had been done.

And speaking of shareholders, I don’t think they can complain. Here’s eBay’s share price over the last three months:

I should also mention that I think Alex’s argument is only valid if you equate economic entities with social entities. But “the economy” is not the same as “society”. Society is about humans. Corporations, while legally having property rights similar to those of natural humans, are still not human. Both humans and corporations exist in the economy — but surely the economy exists to serve humans? Or society?

“Society” and “humans” are different, too, just as “a person” and “all their cells” are different. For a human to survive, cells are sometimes sacrificed. For a society to survive, humans are sometimes sacrificed. “Survival of the fittest” is about the species, not the individual. So maybe human society is the entity of concern, not individual humans?

Our human rights such as freedom of thought and communication, at least in theory, allow a “better” society to evolve. Some argue that these freedoms allowed Western Liberal Capitalism to triumph over Communism and Fascism — the grand theme of the 20th Century! I probably agree with them.

I say masses because the ACCC’s power is provided by Government, and most people (i.e. ‘masses’ of people) support our current structure of Government, and what it does (i.e. regulation of the market.) I do not ‘sneeringly‘ call them masses; for you to suggest so is nothing more than an appeal to emotion.

You wrote: “The name of the game is to increase your slice of your category’s pie by sticking the knife into your competitors.” No, under any moral political system that would be illegal. The name of the game is ‘increasing your slice of your category’s pie’ by making the product you offer more enticing, more beneficial, to society. Any company that does so achieves it goal, any company that does not, becomes inviable and folds. eBay is aiming to achieve this goal: whether it succeeds or not is up to whether its changes truly do make it more beneficial and enticing to society. It seems from most press that eBay’s actions are making its product less enticing and less enviable. Not my problem, not your problem, not the Government’s problem.

How is eBay ‘bleeding’ more money out of them? eBay is merely saying that if they want to use eBay, these are the new terms. It’s no different to an eBay user saying “hey eBay, I’m not going to use you anymore unless you allow direct deposit payments”. eBay will say “we decline, please move on.” As such, in the actual situation, the eBay user will just say “I decline, please move on” if they do not agree to the changes eBay has made. Why is the first situation considered legal, the second, illegal?

And yes: the role of the law is to allow myself, and anybody else who wishes to do so, to turn my ideas into property, and then pass them onto others if I wish to do so. It is not, however, the role of the law to intrude onto property, and give one individual an unfair advantage over another, via force. For what else is this situation, but the Government (the law, as it is currently) intruding on eBay, and using force to remove some of eBay’s property: property which eBay obtained without harming any other individual in society, property which eBay uses not to harm others, but to provide them a service they can voluntarily opt in or out of.

The “pesky masses” (why always being so hard on society?) also do have all the rights they need, just like I have all the rights I need: the rights to hold property without having that property removed by force by majority opinion of the tribe (i.e. what the ACCC says.) Our strongest right by consequence is not choosing where we spend their money, but simply choosing to spend their money, or choosing to receive someone else’s money if met with an offer. You treat it as if these people inherently have a right to have every offer they make (i.e. “eBay, we will enter into legal contract with you and use your product if you allow us to use our own payment methods whilst using your property”) accepted. This is not so; eBay has the right to say “no, we do not wish to enter into legal contract with you on those terms.” I have the right to not enter into legal contracts I do not wish to enter, you have that right. Why should eBay not have that right?

Also, do not ever (and this is important), do not ever associate me with John Howard, his WorkChoices laws, or Bill O’Reilly. That’s an association fallacy. You of all people should know better than to use such rhetoric to attempt to undermine my arguments; it’s mediocre, unintelligent and offensive. Further, there’s no need to wish me luck, associate me with pony rides, and make the point I’m in high school. That’s condescending, treat me like you’d treat an adult or don’t treat me at all.

My real problem is with your declaration that the very notion of fairness embodied in consumer rights advocacy is inherently immoral; an affront to a business’ ‘property rights’. It would seem you believe those pesky masses already have all the rights they need merely by choosing where they spend their dollar. Ah yes, it’s all about the primacy of the individual’s ‘choice’ (just like it was with Howard’s phoney WorkChoices that we collectively chose to stick up his arse last November). Yet in the same breath you baulk at the idea of consumers being entitled to retain any real choice of payment method on eBay (and thus timeliness and convenience), lest, God forbid, it steps on the toes of your beloved corporate entity’s capacity to bleed yet more money out of them. Rather, as Bill O’Reilly would say, it seems you think they should just “SHUT UP” and go somewhere else.

Fucken Socialists.
Nice one, lad.

Your prospect (what you sneeringly call ‘the masses’) is NOT your enemy — your market competitors are.
The name of the game is to increase your slice of your category’s pie by sticking the knife into your competitors.
And if you already own the pie, as eBay do, you turn your efforts to increasing the size of the pie itself.
What you never ever do is bully and snooker your customers with the sort of Third Line Forcing swifty — and that’s exactly what it is, Alex — that eBay seems to be pulling out here.
Once you burn whatever high ground you might once have had in the mind of your customer, you’re fucked — go to the back of the Centrelink queue, do not pass Go, do not collect $200.
And that’s exactly why Stilgherrian is so spot on in pointing out the precious goodwill that’s being sacrificed here.

So best of luck with any capitalist pony rides you’re planning for when you’re out of high school.
Sounds like you’ll need it.

Society is warfare.
Making enemies within it is ‘innovative’ and profitable.
The role of law is simply to facilitate ‘intelligent’ people, like Alex Willemyns and eBay, turning their ideas into ‘property’, and thus into capital.
And those aren’t people down there in the wastelands — they’re stupid, whingeing, faceless ‘masses’ who only have themselves to blame for not starting their own business.
All other sensibilies are Socialist and immoral.

Brilliant thinking, Willemyns.
Something of a triumph for the tyranny of intangible ‘property rights’ over anything resembling empathy.
The future indeed looks bright for you…if not for those greedy, interfering ‘masses’.