Business

Which Popular Rock Star Just Defended Free Market Capitalism?

Posted on May 30, 2012 at 4:21pm by Becket Adams
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In an age where rock stars spend most of their time denouncing businesses and profits, it’s rare to see a talented musician not only practice free market capitalism but also defend it.

Jack White (of White Stripes fame) is displaying his fluency in basic economics via his personal record label Third Man Records [which we’re going to pretend is a reference to the Carol Reed classic].

Forbes explains:

Third Man Records, puts out limited prints of records in order to meet customer demand “to be involved in collecting rare and interesting vinyl.” There is a problem with this though. If you make something rare and valuable, the market price will be high.

White found out the hard way that if you market a product as “rare and valuable” and then artificially price it too low, people will buy that product in bulk and resell it for what people are actually willing to pay.

And that’s exactly what happened: people bought up dozens of the low-priced vinyls for practically nothing and then “flipped” them for hundreds of dollars on eBay.

This is where it gets interesting.

“Many artists in this position would complain about the greedy resellers and that would be the end of it,” Forbes’ Adam Ozimek writes.

“But White realized that 1) if customers want rare and valuable albums they will be expensive, 2) the market price will be reached no matter what they sell them for initially, and 3) if someone is going to profit it might as well be the creators,” he adds.

Instead keeping the price artificially low, White decided to auction the vinyls and let market demand dictate what people would pay for them. He soon discovered that people were willing to pay up to $300 for the privilege of owning a “rare” vinyl.

Of course, once White started doing this, people who don’t understand market demand and the idea that you pay a premium for a niche product complained that the auctions were “exploitative.”

But White isn’t backing down. His business model makes sense and he knows it:

We sell a Wanda Jackson split record for 10 bucks, the eBay flipper turns around and sells it for 300… If 300 is what it’s worth, then why doesn’t Third Man Records sell it for 300? If we sell them for more, the artist gets more, the flipper gets nothing. We’re not in the business of making flippers a living. We’re in the business of giving fans what they want.

He went on to point out that “rare and valuable” is what drives the price:

…make no mistake, we could make twenty thousand split color whatevers for you, and they’ll be worth 20 bucks, and you’ll pay 20 bucks for them, and you’ll never talk about them, desire them, hunt to find them, etc. why should ebay flippers, who are not real fans, dictate the price, make all the profit (taken from the artist and the label) and take the records out of the hands of real fans. there’s a guy who waits in a black suv down the block from third man who hires homeless people to go buy him tri colors when they are on sale. doesn’t even get out of his car. should he be charged ten bucks or two hundred? don’t be spoiled, don’t insult people who are trying to give you what you want.

Of course, as Forbes notes, the “flippers” don’t dictate price, the supply of vinyl and market demand sets price [but we’ll let that slide].

“Jack White is clearly a man who thinks like an economist. By giving the profit to the creators instead of the resellers, this gives White, Third Man, and their artists more incentive to create more albums,” Ozimek writes.

Nevertheless, some “fans” are still complaining that they can’t get a premium niche product for free. White has a message for them:

don’t get mad at third man for giving you exactly what you’ve asked for. and seriously stop all of the whining, because what you communicate to us is that all of the trouble we go to isn’t worth it because nothing we do will make you happy.

Front page photo source/This story has been updated.

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Comments (98)

conservativemom99
Posted on May 30, 2012 at 8:00pm
How anyone in Hollywierd thinks capitalism is bad is beyond me. Without it they wouldn’t have to diet to stay thin…they’d starve…or get fat living off the government’s dime.
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- MrObvious
  Posted on May 30, 2012 at 9:04pm
  Most of the time, the H in Hollywood stands for Hypocrisy.
  It’s nice to see it stand for Honest once in awhile.
  Report Post »
- Tree_Butcher
  Posted on May 30, 2012 at 10:43pm
  I have heard only one work for free once (Jim Caviezel – The Passion of the Christ. Correct me if I heard wrong), and for the rest I hear the Hollywood left complaining about how bad things are while they lick frogs at parties…
  Report Post »
- love the kids
  Posted on May 31, 2012 at 12:03am
  I say this all the time, but never hear it repeated, Movie stars and Rock stars suffer from what I call “Lottery Syndrome”. That is what happens to people after they win the lottery, they instantly change. The big Hollywood stars realize that they just happen to be in the right place at the right time to be where they are today. Look at Pamela Anderson, at a sporting event she got put up on the big screen and the rest is history. What happens is that these people go to auditions, sometimes hundreds of auditions, and then 1 time, just 1 time, someone pick them over the hundreds of people trying out for that part. Then if the first gig is a hit, then they keep getting repeat work.
  Have you ever heard a moviestar talk about shooting a scene where they had to stay up 24 hours and it was sooo grueling? And this is only after the last movie they were in was 2 years ago. I know that I have to stay up 24 hours for my job a couple times a year and change my whole life just to keep my job. They may be a good entertainer, and that’s fine with me that it works for them, but they all know that they just “Happened to be in the right place at the right time”, and I think that they feel guilty about it deep down.
  Report Post »
- decroded
  Posted on May 31, 2012 at 2:25am
  Folks fighting for our freedom: Billy Corgin…
  Megadeth frontman. Ministry frontman.
  Artists and Actors for 911 [AA911Truth.org]
  
  Etcentera….
  Report Post »
- loriann12
  Posted on May 31, 2012 at 6:53am
  People who can afford it will always have what they want. That’s why I crochet doilies and collect patterns for them (most printed off the computer for free) and collect doily yarn. Even if the economy collapses there will be those who want hand-crocheted doilies and will pay stupid prices for them when you can’t run to Walmart and get them. Learn a skill people.
  Report Post »
- soljavsnbppseiu
  Posted on May 31, 2012 at 7:03am
  @love…
  excellent comment…. couldn’t agree more.
  I would add that on top of all that there is a mob-like mentality in Hollywood of ‘if your not with us then your against us’ and ‘if you wanna keep getting the green then you better play along with the team”
  
  It’s quite obvious… any celebrity who goes against the far left grain out there is shunned or attacked simply for having a different point of view.
  Report Post »
- acovenantinblood
  Posted on May 31, 2012 at 9:22am
  I can’t understand how good God fearing people can justify getting entertained and financially supporting such a godless and socially destructive entity. Yet so many “Christians” stand in the theater lines every weekend to catch that new culturally subversive movie for the sake of being “entertained”. How would one of these people who set so many works of darkness before their eyes feel if Jesus showed up and started thumbing through their movie collection? Does not He Himself teach how great a change must happen to us in order to be saved? Maybe the reason we are being judged by Barak Obama is because we have slandered Gods Holy Name by not acting the “Christians” we claim to be.
  Report Post »
- Scottscobig
  Posted on May 31, 2012 at 9:25am
  @ lovethekids
  
  Absolutely right. There’s a huge difference between someone giving 10 years of blood, sweat and tears to bring a product to market or start a business and some lottery winner/rock star/movie star/pro-athlete. In the words of Fransisco D’Anconia, “No man can be smaller than his money.”
  
  On the other hand, I would be against any attempt to regulate these bozos’ salaries or whatever. The market has to decide. But, you look at their lives and you can see they skipped the character-building process an entrepreneur/businessman must go through to get rich.
  
  Or is it simply that their failures are so public; where ours aren’t?
  Report Post »
- G-WHIZ
  Posted on May 31, 2012 at 10:26am
  …all that lovely govment-block-prossess-cheeze.
  Report Post »
- Dano.50
  Posted on May 31, 2012 at 10:28am
  @love and @scotts
  
  Speaking from personal experience, most making it in the entertainment biz grind their way to the top just like in any other career. Anderson and such like her really are those few and far between lottery winners.
  
  Plucked from obscurity they probably are least qualified to deal with instant fame but having nearly made pro in a sport I can also say ego problems can start long before the top. Any kid showing a hint of talent or ability, starts getting egos stroked and I‘ve seen lots of 16 year olds blow promising atheltic careers because Mom and Dad did’t give them a good swift kick in the– I mean, a good swift talking to.
  
  As example, I “had” a friend who’s son is being heavily scouted by WHL hockey team, (one level below the NHL) but the running bet is the 15 year old is probably not going to make it because he’s going to get a girl pregnant first.
  
  Having seen lots of careers going down the ol’ falopian tubes, I made the mistake of trying to caution my friend and his less than courteous reply was, “Oh shut up, you can‘t take away a kid’s childhood. You don’t even have kids so what do you know?”
  
  Aside from the oh so many flaws in that line of idiocracy, I have never before come across a more sure fire bet.
  Report Post »
- YOUR NOT GETTING MY GUNS
  Posted on May 31, 2012 at 10:37am
  Glad to see The Blaze on the ball. This whole story happened a year and half ago. Story was uploaded to Youtube in Dec.2010.
  Report Post »
- lovenfl3
  Posted on May 31, 2012 at 10:46am
  I think more and more people are starting to understand this simple premise. Free market capitalism is what made this the greatest nation in history. If the OWS types ever “win” this war against capitalism, there will be no winners in the end.
  http://www.youtube.com/watch?v=m5kwKTxxEy4
  Report Post »
- Lateris
  Posted on May 31, 2012 at 11:16am
  The guy is from Detroit.
  Report Post »
- rosecityken
  Posted on May 31, 2012 at 12:39pm
  It is kind of comical if you think about the hypocrisy, hollywood would have never existed if it wasnt for capitalism….period. let them figure that out, while S-talking capitalism…maybe if the money stops they will have much easier time “dieting”
  Report Post »
- Best_Patriot
  Posted on May 31, 2012 at 1:53pm
  Jack White isn’t Hollywood, he’s Nashville. Not that it matters…just pointing out the knee-jerk and ignorant tendencies of the tea bags in here.
  Report Post »
Lowgo1981
Posted on May 30, 2012 at 6:47pm
Jack White is one of the most talented musicians I have ever seen. Listened to him for years and told people about him long before he was famous, but believe me this is a shocker. Listen to the song Icky Thump. He is most definitely a liberal. Nice to see he is beginning to see the light!
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- SgtB
  Posted on May 30, 2012 at 7:23pm
  I no longer listen to that song because one day I actually listened to the lyrics. I forget what he said, but I remember I don’t like it and he definitely is a liberal. Sometimes, it’ll come on the radio (cause I still listen to radio and don’t jack into an ipod) and I‘ll forget what song it is I don’t like and then I get into the song a little bit and WHAM! GD liberal BS hits me in the face and I have to turn the station. Glad to see that he at least understands the laws of supply and demand.
  Report Post »
- myway2112
  Posted on May 30, 2012 at 7:35pm
  I agree that he is truly an original, and we need more like him. I am glad he sees the capitalist postion as successful.
  Report Post »
- vox_populi
  Posted on May 31, 2012 at 12:10am
  I like the way the Blaze spun this. Ignore the fact that the closest actors to “capitalists” in this scenario are the “flippers” – profiting greatly at the expense of another’s labor.
  Report Post »
- SandTrout
  Posted on May 31, 2012 at 12:52am
  @Vox
  
  Yes, the flippers are benefiting from anothers labor. They are, however, still only participating in free exchange, and taking advantage of an opportunity that they saw. They are not assaulting anyone. They are not forcefully stealing the money. They are not threatening anyone.
  
  You, however, would have the IRS take the money, and give it to ‘unfortunates’ that have done nothing to earn it except vote into power people who will steal more money from people who produce to give to the ‘poor’. You would arrest and jail people for not wanting to give money to the lady with 12 kids, or the guy that can’t get work because he always shows up drunk.
  
  It is you who wishes to benefit from another’s labor, and don’t try to accuse capitalism of that, because that is a lie of the worst sort. It as a lie that completely inverts the truth.
  Report Post »
- loriann12
  Posted on May 31, 2012 at 7:33am
  There are liberal capitalists. The difference is they don’t help anyone else make a profit. They get up the ladder to success, and then kick the ladder out so no one else can climb it. There will always be people who buy cheap and sell high. Now that he knows it will sell for $300, he should raise the price, but not necessarily to $300. But knocking out the middle man, he’s knocking out someone else from climbing that ladder.
  Report Post »
- Fubared
  Posted on May 31, 2012 at 8:05am
  Pox
  You guys can still claim the Black Eye Peas. And Babs of course. And your idol Justin Beiber as always. Poor poor Pox.
  Report Post »
- six6six
  Posted on May 31, 2012 at 4:24pm
  So who is the popular rock star in this story. They can’t mean Jack White. I mean really, what has he done in the last 20 years?
  Report Post »
sunnyblack
Posted on May 30, 2012 at 6:32pm
Mehh, five bucks says he still ends up voting for Hopey McChange (same with Guttenburg).
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- The-Monk
  Posted on May 30, 2012 at 6:57pm
  Al, Jessie and Eric will be on the case in no time. A band called “White” promoting an anti-Obama theme… here comes the IRS.
  Report Post »
- Guerrino_P
  Posted on May 30, 2012 at 7:18pm
  You’re right Sunny. He will vote Obama. I just wish Romney wasn’t such a flake and was a viable choice. It looks like another four years of Hopey McChange. Oh, I bought White’s new album (on vinyl). Highly recommended.
  Report Post »
- JACKTHETOAD
  Posted on May 30, 2012 at 9:36pm
  Hope he doesn’t play a Gibson. Double-whammy.
  Report Post »
A. James
Posted on May 30, 2012 at 6:22pm
Let’s not get too excited here. He’s more than likely one of those “I’m a hardcore liberal!” conservatives. You know, the everyday liberal that’s too ignorant to believe that he is actually a fiscal conservative.

Furthermore, liberals are the biggest capitalists when it’s their money and business involved. Hypocrites.
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6thdegreeblack
Posted on May 30, 2012 at 6:13pm
Ever since Limewire/MySpace and similar music (stealing) sites promoted and propagated the “sharing” of copyrighted material the Music industry has been on the ropes. The theft on a massive scale of the product for an entire segment of the worlds economy greatly devalued that product and as a result, what you see in the market today reflects that lowered incentive to create.
Todays pop music is dominated by cheaply made loop tracks with repetitive prepackaged vocals totally lacking in the craft and artistry of past eras. With such weak content the only marketing strategy that works today seems to be outrageous behavior and or public displays of nudity.
Its a sad commentary on the current state of our society.

I commend the White Stripes for defending their economic incentive to create.

Deep Bow (eyes up)
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- Weiners Wiener
  Posted on May 30, 2012 at 6:43pm
  Myspace? Myspace had nothing to do with file sharing.
  Report Post »
- MAMMY_NUNN
  Posted on May 30, 2012 at 10:43pm
  Real music died when they stopped pressing vinyl nothing beats the vinyl spinning on the platter CD’s are flat and unfeeling.
  Report Post »
ValidFib
Posted on May 30, 2012 at 6:10pm
Jack White lives in Nashville now. He knows Tennessee has no income tax and is much more business friendly than Detroit (where he came from).
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VTPatriot44
Posted on May 30, 2012 at 6:04pm
Very nice salute to capitalism and rewarding the producers in society. Jack White is obviously not a fool, as well as being a talented artist. Most people are familiar with his edgy rock music that hit the radio about 12 years ago, but if you are looking for something truly different check him out in the movie Cold Mountain singing some blue grass. While it sounds a bit cliche, it’s quite haunting. Good movie and better song IMO. If he hasn’t done a blue grass album he should. For those who are interested here’s a link on YouTube: http://www.youtube.com/watch?v=aQHAannVEaE
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forthepeople
Posted on May 30, 2012 at 5:38pm
Once a American citizen really truthfully ponders what is going on in this country they can only come to one rational conclusion …. We are and have been watching the left facade crumble , falling down after being built on deception with many lies !
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thekuligs
Posted on May 30, 2012 at 5:38pm
I wonder do you guys actully listen to The White Stripes? They are sort of a guilty pleasure of mine, I like the beat but their over all message is a far cry from most people on The Blaze.

For example from the song Icky Thump:
White Americans, what? Nothing better to do
Why don’t you kick yourself out, you’re an immigrant too.
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bpodlesnik
Posted on May 30, 2012 at 5:32pm
Ahh yes, The White Stripes, I love all of their music. Their in my top 10 list of favorite artists.
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dannyo
Posted on May 30, 2012 at 5:28pm
steven tyler thinks the same way…the tide is changing..fingers crossed…
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65Mustang
Posted on May 30, 2012 at 5:24pm
Never heard of him but I admire his business philosophy.
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biohazard23
Posted on May 30, 2012 at 5:23pm
Icky Thump to the whiners.
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bumfuzeled
Posted on May 30, 2012 at 5:21pm
Never heard of this guy but I instantly like his style and ability to learn the hard way. He strikes me as a true entrepreneur.
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TRONINTHEMORNING
Posted on May 30, 2012 at 5:16pm
My kids love Jack; my son just saw him in Nashville then in Washington. I like him for his desire to make zillions.
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AUsername
Posted on May 30, 2012 at 5:13pm
yeah something we don’t have in this country and we would like.
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randy
Posted on May 30, 2012 at 5:01pm
And Jack plays a Mean Diddley bow! :)

http://www.youtube.com/watch?v=dZNk76_4lds
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- danyelle55
  Posted on May 30, 2012 at 5:06pm
  Happy to see this, LOVE White Stripes and Jack White! Wish him and Meg were still together. Never made it to see them live!
  Report Post »
randy
Posted on May 30, 2012 at 4:59pm
But fans are still unhappy and have taken to social media outlets to complain that they can’t get a premium niche product for free. White doesn’t care:

Good for you Jack!!!
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Eric_The_Red_State
Posted on May 30, 2012 at 4:48pm
I cant think of any soldier who fought and died for “Socialism” – so – well done Jack
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Staregan
Posted on May 30, 2012 at 4:42pm
Good for you Jack! The vast majority of people, and it goes w/out saying the true fans, are with ya!
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LOJ
Posted on May 30, 2012 at 4:34pm
Anyone with a Brain knows that when people are allowed to create businesses and work for themselves, there will be a trickle down affect to the communities and cities. The Radicals know this too, they are trying to intimidate and destroy American Innovativeness and Freedom!
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- @leftfighter
  Posted on May 30, 2012 at 4:44pm
  Yeah, well let’s hope the Useful Idiots who listen to his music learn something from him here.
  Report Post »
- Exrepublisheep
  Posted on May 30, 2012 at 4:46pm
  Destroy Freedom!! YES!!!
  Report Post »
- vox_populi
  Posted on May 30, 2012 at 4:52pm
  “destroy American Innovativeness and Freedom!”
  
  Yeah, it’s a good thing we built all those anti-freedom bombs. You know, to destroy your freedom. Or whatever.
  Report Post »
- Fubared
  Posted on May 30, 2012 at 5:40pm
  Pox
  You are the party of glitter bombs and pity parties. Who really knows what you schmucks will do next.
  Report Post »
RJJinGadsden
Posted on May 30, 2012 at 4:34pm
Finally, somebody in the music business that makes sense. The music is not bad either and I could find myself listening to it. It’s not Pink Floyd, Jimmi Hendrix, Led Zeppelin, or Steppenwolf, but I could still listen to it.
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LIBSALWAYSLIE
Posted on May 30, 2012 at 4:29pm
The creator of the product should make the most profit from it. This guy has it figured out, good for him.
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flat_top_particular_about_the_point_it_makes
Posted on May 30, 2012 at 4:29pm
I collect rare LPs and I’m always curious why flea market dealers never bother to check the collector price of the LPs they are selling. I got a Lodestone LP the other day for $1 even though it’s worth $100. popsike.com has values of pop/psych type LPs sold on ebay.
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wakeus_com
Posted on May 30, 2012 at 4:28pm
“Of White Stripes fame.”

Funniest thing I have ever read.
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- cntrlfrk
  Posted on May 30, 2012 at 4:46pm
  No kidding.
  
  I don’t even know who the hell they are!
  
  .
  Report Post »
- BenInNY
  Posted on May 30, 2012 at 5:05pm
  Wow. Were around a solid 10 years and had a bunch of hits.
  Report Post »
- shirtsbyeric
  Posted on May 30, 2012 at 5:33pm
  They were around longer than that. i last saw them in the late 90′s when they were still on the Sympathy for the Record Industry label.
  Report Post »
- mike_trivisonno
  Posted on May 30, 2012 at 5:53pm
  The White Stripes are pretty good. They have been cranking out solid stuff for some time now.
  Report Post »
- pinostabaum
  Posted on May 30, 2012 at 6:14pm
  fogey.
  Report Post »
- Cesium
  Posted on May 30, 2012 at 7:44pm
  Someone is living under a rock
  Report Post »

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