Market Prices

Supply and demand market curves

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It has been really, really hot in Memphis and in other parts of the country. People have suffered as a result. A politician who claimed that he was going to fight a war on heat by passing a “maximum temperature law”–or by switching temperature readings to celsius so that the numbers are smaller–would be laughed at. And yet that same politician who claims that he is helping the poor by passing minimum wage laws, price-gouging statutes, rent control, and other forms of interference with market prices is lauded as a compassionate hero of the downtrodden.

You can’t change heat, humidity, or people’s weight by passing laws. You also can’t change people’s productivity by passing laws. “Make it so” is great campaign rhetoric but it’s lousy economics. In a grocery store a few years ago, I saw someone wearing a t-shirt that reads “Stop Plate Tectonics.” A shirt reading “Stop Supply and Demand” would make just as much sense.

via Market Prices Versus “Make It So” — Mises Economics Blog.

What could I possibly add?


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