Wework, Uber, Lyft, Netflix, Bird, Amazon: late-stage capitalism is all about money-losing predatory pricing aimed at creating monopolies

Wework is definitely a piece of work, a money-hemorrhaging bezzle whose recently ousted founder siphoned a reported $700m out of the company while self-dealing and presiding over a series of bizarre missteps (from serving tequila shots and hosting a dance party with Darryl from Run DMC at the same meeting where he announced mass layoffs to banning his employees from expensing meals containing meat while getting caught eating meat himself).

But in addition to its grifty sociopathic founder, Wework follows a common pattern of tech businesses: backed by titanic amounts of money that allows it to sell at predatory, money-losing prices in order to force out all possible competitors and establish a monopoly.

Wework's real story isn't the terrible dude at the front of the parade: it's the giant VC and private equity funds who shower him with literal billions.

These businesses' explicit plan is to bankrupt or scare off anyone who wants to run a real business, one where entrepreneurs compete by lowering prices through applying a process to inputs to make something more valuable than the sum of its parts -- instead, these businesses (Matt Stoller calls them "counterfeit capitalism") compete solely on access to capital, which they use to create products that are worth less than the sum of their parts.

Stoller compares the outcome of this to "Gresham's law," which describes how, when counterfeit money is in circulation, "bad money drive out good." That is, if you get a counterfeit coin, you try to spend it as soon as you can because if it is detected while you have it, you lose. Read the rest