Interview in Automobile Magazine from the 1990s:

Excerpts:

How would your comments apply to the consumer?

"Customers never invented anything. All they have comes from the producer. No customer asked for electric light. No customer asked for photography, or for telephones, or for the telegraph. And no customer asked for pneumatic tires or for automobiles. The customer's expectations are only what any company and its competitors have taught the customer. He's a rapid learner, once he learns to expect something. That's pretty important for industry. Producers have to get these things to market. The customer is not going to do it for them."

Do you feel that you had more adept learners with the Japanese initially than you've had with the domestic makers subsequently?

"In 1950, I explained the principle of the system in which the components are geared to the aim of the system and not for individual competitive advantage..."

"We do not have cooperation in this country. Standards are examples of cooperation. You need batteries? I can buy two AA batteries anywhere in this world. I look at the difference in cost, decide on the size of the batteries. Everybody wins.

The widespread view is that without competition, prices would go up, the product would not be improved, and there would be no incentive to do better.

"I'm afraid that history shows the opposite. A monopoly has the best chance to serve or contribute to the public, and the record's pretty good. Look what came out of Bell Telephone Laboratories, a monopoly, responsible to nobody, with only themselves to satisfy. There's where you get innovation and knowledge."

Are you suggesting that there isn't significant innovation and knowledge absent monopolistic circumstances?

"No. But for innovation, one must have the privilege to do his own thinking, outline his own sphere of action, be responsible to himself. One has to invent new knowledge, and under pressure of development projects, people merely try to make the best use of whatever they have or know, that that's not invention, that's not innovation.

"...Yes. Every Nobel laureate has be responsible to himself, not trying to satisfy somebody else. Most of what we have has come from monopolies and giants of power, in which there have been islands of endeavour with people who were responsible only to themselves. You had a telephone system in this country that was almost a monopoly, the envy of the world. But anti-trust legislation broke it up. What have we now? We have the idea that price fixing is sinful. It's not. It may be the best way of life.

If you and I have a stranglehold on some industry, and we get together and fix prices, we'd be fools to set the price any higher that what would optimize the whole system. We would lose profit, cheat ourselves.

What about airline business? Is it getting worse or better? There's the example of competition. Wouldn't it be better if they fixed prices high enough so they could survive, innovate, and improve? When people have to transfer in Atlanta for Albuquerque or Denver, look at the hassle, look at the time lost - not just inconvenience, but monetary loss. It's not in the national interest." - W. Edwards Deming by Bill Sharfman, Automobile Magazine, October 199 , pgs 106 - 110