&quot;Free market&quot; is a really complex idea and as such I think it requires <i>dynamic</i> maintenance, not just a good set up (compare: open and closed systems in control theory).<p>So in this case, solution #2, so it happened that because of people shouting &quot;free market!&quot; we have last-mile lines owned by companies and a bad oligopoly has appeared. The solution should be to adjust - the government should come and say, &quot;thank you for all your service, but the balance of force needs to be restored&quot;, take over the line and put everyone in order.<p>Yes, there are (recursive) problems with that particular solution, but still, if we want to implement a perfect theoretical &quot;free market&quot;, we need to embrace the constant adjustments that are required to keep it.