The Dangers of Price Controls

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Posted on 11/25/2024 10:03:57 AM PST by Retain Mike

Price and wage fixing is always harmful. There is no right way of doing it. There is no right way of doing a wrong thing. There is no fair way of doing something that oughtn’t be done at all. We can’t even define a fair price or a fair profit or a fair wage apart from the market or apart from the state of supply and demand. Instead of talking about “fair” prices, “fair” profits, and “fair” wages, we ought to be talking about functional wages, functional prices, and functional profits. Prices have work to do. What they do in effect is give the necessary signals to production. They direct production into the things that are most wanted socially, to provide a balance among the thousands of different commodities and services in the proportions that the consumers want them.

Price and wage fixing is always harmful. There is no right way of doing it. There is no right way of doing a wrong thing. There is no fair way of doing something that oughtn’t be done at all. We can’t even define a fair price or a fair profit or a fair wage apart from the market or apart from the state of supply and demand. Instead of talking about “fair” prices, “fair” profits, and “fair” wages, we ought to be talking about functional wages, functional prices, and functional profits. Prices have work to do. What they do in effect is give the necessary signals to production. They direct production into the things that are most wanted socially, to provide a balance among the thousands of different commodities and services in the proportions that the consumers want them.

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Thank you very much and God bless you.

This seems obvious, but I guess it needs to be said regularly.

1 posted on 11/25/2024 10:03:57 AM PST by Retain Mike

To: Retain Mike

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