No Price Control

Watching the latest Republican Party debate, there was more focus on the economic issue.

There was a lot of talk about how government and “the Obama economy” has wrecked everything. They said if we just reduce government spending and do a flat tax–problem solved!

The reason the Republican Party is effectively dead and on life support is because it is being supported by the “donor class.” If, then, the only alternative is to vote for the Democratic Party, what progress is being made?

Voters have no way to control for the price to be paid, politically or economically. What is the inevitable result of that?

We confirm that it is really a free market, after all.

Sanders, for example, has emerged to allow for an alternative at the margin, and that makes a really big difference. Not only does it bust the counter-identity game (toggling between Republicans and Democrats) but it also makes it harder to resist the inevitable (imperative) value (a free market, after all).

Conservatives say that Sanders is advocating for price controls. (Funny that every time I advocate keeping costs down on the bid side, people who want to control prices on the ask side say, “Well, you know what that does!”… Yeah, it controls for the price!) Controlling for prices on the bid side, like in a free market, and not on the command side, doesn’t make you “a communist or something.”

Quite the contrary!

It wasn’t scary socialism that forced millions of Americans into default and bulldozed the American Dream to support the rents.

Republican policies and programs were so bad that “the Obama economy” is a triumph measured against the tragedy. President Obama is not what is wrong with it. It is the legacy of Republican policies and programs, supported by, for example, Antonin Scalia, who essentially decreed that George W. Bush be president, and supported a state’s right to suppress the popular vote (hardly the attributes of “genius”).

While the real identity of a 4.9% unemployment rate is questionable, what it would be like without an Obama administration is more than just marginally different. With a 4.9% rate, we should have a really high inflation rate. What explains the price control is deflation–the direct result of Republican policies and programs being currently advocated as the solution.

The low rate of unemployment and the low rate of inflation that keeps us close to ZIRP has a measurable effect at the margin. It will keep us from doing double the detriment by inevitably switching to a Republican-Party platform.

Rather than saving us from big government, a flat-tax program will make it worse. It is highly regressive. That’s why Republicans advocate it. Combine that with welfare cuts and the level of economic desperation will be so high, you will be working for even less than you are now to produce more, which is deflationary, and when that happens capitalists must either increase the debt proportion to support the price, or destroy the marginal product rather than supply the demand.

If you have a hard time paying health-care insurance now, declining income against rising costs is an inevitable means of ensuring price controls, and it won’t be because communists make it happen.


About griffithlighton

musician-composer, artist, writer, philosopher and political economist (M.A.)
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