2014-11-05

The Folly Of Price Fixing

It always struck me as illogical stating the price of a good or service will be 'fixed at 'x' dollars'. To me, a price is nothing but a reflection of the combined voluntary actions between people in the market place.

By abandoning price set in a free market (or abolishing if you prefer as the commies would like), you abandon the concept of the market. At this point, listening to progressives speak, I'm not so sure they understand what a market is anymore. A market is not necessarily a physical place. It can be like, say, a food market where farmers come and sell their produce with their prices set by the 'unseen' market by consumers. I say unseen because people don't see how inflation, the cost of labour, transportation, commodities etc. affect price. Which, I reckon, is why it's so easy for progressive politicians to assert it's 'rigged'. Of course it's rigged! Why are peppers so damn expensive! Profit! Greed!

Let's take subsidized daycare for example. Never has a better example of folly been presented to us. Whether we choose to see it is another matter. Alas, I'm not so sure. One person I know said, we're 'lucky' to have it. As if, life was dark before the arrival of subsidized daycare. When I explained ot that person the nuts of bolts of the story it was liking speaking to a cat. By that I mean, they seemed unconcerned and aloof by the idea that '$7 a day day care actually costs significantly' more. It's an irrational economic position driven by the emotional idea of 'we're in it together.' In other words, the collective.

It's pure folly.
 
Eliminating prices means you have to control everything. Including man's vices and virtues. This is the part communism and socialism never quite could, you know, handle.  Allende gave it a shot in Chile but I guess the creepiness of the Cybersyn Project got the better of people (frightened by its logical end no doubt) and he was killed ushering in Pinocchet. As far as I'm concerned, what Allende was up to was pure evil. But it wasn't seen as that because they were high on the delusional idea of 'for the greater good'.

They believe so much in their good intentions it was, well, evil.


Here in Canada. the NDP are a little more rational and modest in their socialism (I hope) and social engineering. Naive and convinced of their good intentions, sure, but not quite Allendesque. But still they try. Like their $15 a day national daycare proposal.

In a word? It's ludicrous. Notably for what I just highlighted above. Costs can't be controlled by a bureaucracy because of price signals in the economy. In order for a national program to function efficiently you need to control factors that affect pricing.

In other words, everything.

This is why in Quebec $7 a day day care is a myth. A figment of the bureaucracy's imagination and the people's dreams of collectivity. It doesn't cost $7. It costs substantially more. So much so, it makes me wonder if we're remedial in our financial thinking. The government asserts it costs $55 a day. Bad enough given the $48 deficit. According to a private association study (which factors in wages and vacation) we're at $180. Think about this for a second.

Wouldn't it be better to just pay $50 a day without the folly and corrupt chaos of subsidized daycare out of pocket? Why be taxed for something like this?

Another issue will be once again asking provinces like Alberta to subsidize this luxury for the rest of the country. 

We shouldn't be asking the state to get involved in industry of any kind because the cost to society - more importantly to the individual - is much, much higher.

This, in part, is why people complain they can't make ends meet. In my view, it's a signal we're over taxed. It's not because of Koch or the free-enterprise system or greed or profits or any other vapid term thrown around. We ask for 'free shit' and we gotta pay for 'free shit'. This means TAXES GO UP. Which, in turns, means less in your pocket.

Bah. Geh.

***

"Are these morons getting dumber or just louder?" Mayor Quimby.





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