Capitalism is the best. It’s free enterprise. Barter. Gimbels, if I get really rank with the clerk, “Well I don’t like this”, how I can resolve it? If it really gets ridiculous, I go, “Frig it, man, I walk.” What can this guy do at Gimbels, even if he was the president of Gimbels? He can always reject me from that store, but I can always go to Macy’s. He can’t really hurt me. Communism is like one big phone company. Government control, man. And if I get too rank with that phone company, where can I go? I’ll end up like a schmuck with a dixie cup on a thread.

This is from here, but I remember first reading it in the 1973 version of David Friedman’s The Machinery of Freedom.

I’m not a big user of reddit. Let me correct that statement: I don’t use it at all. But it obviously works for many people. And reddit might lose market share soon. Why? Because reddit, under the new CEO, Ellen Pao, the woman who recently lost a sexual harassment lawsuit against venture capital firm Kleiner Perkins, announced a ban on certain kinds of groups. The announcement states:

It is not easy to balance these values, especially as the Internet evolves. We are learning and hopefully improving as we move forward. We want to be open about our involvement: We will ban subreddits that allow their communities to use the subreddit as a platform to harass individuals when moderators don’t take action. We’re banning behavior, not ideas.
Today we are removing five subreddits that break our reddit rules based on their harassment of individuals. If a subreddit has been banned for harassment, you will see that in the ban notice. The only banned subreddit with more than 5,000 subscribers is r/fatpeoplehate.

I’m not challenging her action. I might be tempted to do the same. And I’m not making the charge that she’s censoring. She’s not. She’s setting standards and people who use reddit can decide whether to comply or go elsewhere.

And that leads to my prediction. They will go elsewhere. Here’s one of my favorite comments by a reddit user:

I can picture her in her office “Yes, people are going to be upset, but where else are they going to find funny pictures on the internet?”

You could say “Good riddance.” Indeed, if what she says in her announcement is accurate, I would say “Good riddance.” But I also predict a loss in market share.

I don’t necessarily predict a loss in market value. Here’s how Fortune magazine put the issue:

Reddit may also be under pressure to combat abuse after the site raised $50 million in funding last year from high-profile venture capital firm Andreessen Horowitz and others. The investors will eventually expect the site, which is independent operated, but owned by the same holding company as magazine giant Conde Nast, to attract more mainstream advertisers that would otherwise shy away from being associated with harassment.