The free market’s fair-weather friends

Sunday, November 13th, 2005 12:32 pm by Neal

Please read The free market’s fair-weather friends by Paul Jacob on the grandstanding, overpaid Senators from both parties who apparently think the free market should only be free during the “good times”. Jacob notes Socialist Senator Boxer’s threat:

Senator Barbara Boxer decided that the moment called not for learned discourse but class warfare. She hauled out a nice chart showing how much money the oil executives had made. “Working people struggle with high gas prices,” she pointed out. “And your sacrifice, gentlemen, appears to be nothing.”

No surprise there. After all, Democrats have long used taxation to support their socialist belief that one role of government is to take from those who produce and give to those who don’t. But what about the Republicans — those “supposed defenders” of capitalism and free markets — who participated in this inquisition? Again, hear Jacobs

Weeks before the show trial — er, I mean public grilling — House Speaker Dennis Hastert stated that any oil company that “price gouges” will “be prosecuted.” Prosecuted for what? Setting a price on their own products? Senate Majority Leader Bill Frist went on record with a sillier statement, saying “those who abuse the free enterprise system to advantage themselves and their businesses at the expense of all Americans, they ought to be exposed. . . .”

But wait: In markets (a) we sell things for our advantage; and (b) others buy them at their expense.

So why carp? Both parties gain. Consumers wouldn’t buy if they didn’t gain something better for each transaction. That’s free enterprise. Expose that.

It’s what makes America great. Not the grandstanding of Senators.

After the hearing, Bill Frist expressed some frustration. He still didn’t get it. The executives, he charged, did not “adequately answer the question of whether the sky-high gas prices we saw earlier this fall were entirely justified.” Oh, great. He thinks the Senate’s job is to determine “the just price” of goods — a hoary economic chimera that begets gross folly such as wage and price controls. Which lead to shortages, sometimes quite catastrophic. Which lead to more government regulation. More catastrophe. And more government. We’ve been through this before. With each government-induced crisis, government grows . . . out of control of the citizenry. Beyond reason.

Haven’t we learned anything from (to quote the title of a good little book) “forty centuries of wage and price controls”? Apparently not. The Republican Majority leader went on to wonder about whether the companies’ “profit margins are appropriate given the hardships energy consumers are facing and will continue to face this winter.”

Last week’s spectacle of hauling oil company executives before the Senate should send shivers down the spine of all Americans who disdain government intervention in the market in the form of price controls, wage controls, profit re-distribution and other heavy-handed regulation that ultimately fail miserably and lead to real crises and shortages (not to mention an ever-expanding government behemoth).

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