Friday, March 27, 2009
CONSTITUTIONAL AMENDMENTS 2 WAGE & PRICE CONTROLS
From Milton Friedman's book Free to Choose:
"As one of us wrote some years ago "If the US ever succumbs to collectivism, to government control over every facet of our lives, it will not be because the socialists win any arguments. It will be through the indirect route of wage and price controls. Prices, as we noted in Chapter 1, transmit information - which Walter Wriston has quite properly translated by describing prices as a form of speech. And prices determined in a free market are a form of speech. We need here the exact counterpart of the First Amendment
In some ways this has dated - back in the 1970s when governments were printing money & inflation was running rampant governments were busy blaming it on greedy workers demanding rising pay. Their answer was price & wage controls. That has gone out of favour since then, though who knows if it will come back. If so a legal restriction on government doing it would still be valuable.
The method government is now using to regulate every facet of our lives is to say that we are suffering from global warming, obesity & everything in between & that the "real" costs are not reflected in the price system thus requiring fovernment refulation. There may or may not be a case refarding obesity but it has been repetedkly shown that when the PC brifade come up with something we ought to do to save the planet it is purely tokenism & makes no numerical sense. eg trains probably produce more CO2 than most driving because trains are big & heavy; swithing off the standby light on your video saves nothing measurable; replacing plastic bags with paper ones uses considerably more material etc.
"As one of us wrote some years ago "If the US ever succumbs to collectivism, to government control over every facet of our lives, it will not be because the socialists win any arguments. It will be through the indirect route of wage and price controls. Prices, as we noted in Chapter 1, transmit information - which Walter Wriston has quite properly translated by describing prices as a form of speech. And prices determined in a free market are a form of speech. We need here the exact counterpart of the First Amendment
Congress shall make no laws abridging the freedom of sellers of goods or labour to price their products or services
In some ways this has dated - back in the 1970s when governments were printing money & inflation was running rampant governments were busy blaming it on greedy workers demanding rising pay. Their answer was price & wage controls. That has gone out of favour since then, though who knows if it will come back. If so a legal restriction on government doing it would still be valuable.
The method government is now using to regulate every facet of our lives is to say that we are suffering from global warming, obesity & everything in between & that the "real" costs are not reflected in the price system thus requiring fovernment refulation. There may or may not be a case refarding obesity but it has been repetedkly shown that when the PC brifade come up with something we ought to do to save the planet it is purely tokenism & makes no numerical sense. eg trains probably produce more CO2 than most driving because trains are big & heavy; swithing off the standby light on your video saves nothing measurable; replacing plastic bags with paper ones uses considerably more material etc.
