The Mighty

Recently, Kamala Harris talked about price gouging when it comes to supermarkets.

She wants to end that – which is noble.  

Her solution is price controls – which is not noble.  

Price control is an attractive concept that has been tried in the past without success.  Eventually politicians abandon price controls.

A better approach is to first understand why we have inflation in the first place.

The main reason we have inflated prices is because the ruling class printed up money to cover for a)  the unnecessary wars in Iraq and Afghanistan, b) the foolish meddling and gambling from Wall Street that caused the sub-prime mortgage crisis, and c) the mismanaged approach to fighting COVID-19. Our ruling class printed up of trillions dollars that they didn’t need to print up if only they had ruled responsibly.  

A second reason why we have inflation is monopolistic greed. When we don’t have a lot of competitors in the market, the main guy is able to increase the price of a good well beyond what it should be. 

The main guy desires to increase the price because we live within a culture of greed that celebrates wealth.

As such, the main guy, desires, toys. He wants, the mansion, the jet and the super yacht.  Not only does he want a mansion in his own hometown, he wants mansions all over the globe.

Cicero in Roman time owned something on the order of 38 hours on the Italian peninsula. He had these houses because he didn’t want to stop in an inn at night when he was traveling.

Our modern oligarchs are no different. Not only do they want mansions all over the globe in phony cities like Aspen, South Beach, New York, LA, Sydney, Toronto, London, Paris, Jackson Hole, Rome and so forth; they want these houses fully staffed even when they are not there.

It’s crazy, but it’s the reality of the world we live in.

This greedy society has produced a world of unparalleled polarized wealth.

Thus the desire to reach out for price controls.

They won’t work.

If we really want to decrease the prices that supermarkets charge, we need more competition in each market.   Nothing produces higher quality and cheaper prices than competition.  Unfortunately, we don’t have that because we allow supermarket chains to engage in predatory pricing much like JD Rockefeller did when he was running Standard Oil. He would ruthlessly lower the price in one market to defeat a competitor while raising it in another market in which he had no competitor. 

The solution is competition.

If we want to bring down prices, we have to break up the bigs.

There’s no other way.

The mighty must fall.

Sincerely,

Archer Crosley

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