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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: flatsville who wrote (100455)5/8/2001 8:42:27 AM
From: Don Lloyd  Read Replies (2) of 436258
 
...Should you find an area where dereg actually has resulted in mythical lower costs to the consumer (as it has been hawked) please let me know.

Even if true deregulation had actually been implemented somewhere, the observation of actual consumer prices would be meaningless in and of itself in judging the process. The purpose of a free market is to distribute a scarce good to its most valued uses and balance supply and demand by impacting both. No one can know what a proper price is except as a result of a market process, so if the price either rises or falls by a factor of 10, it says nothing useful by itself. What we do know is that a persistent shortage indicates either that prices are too low or that there exist regulatory or other barriers to entry or both. If a proponent of deregulation claims that consumer prices will necessarily fall he is every bit as much of an ignoramus as a so-called consumer advocate who cares about nothing but consumer prices even to the point of shortages.
If the market price for a necessity is judged to be too high for a portion of the population, subsidies or vouchers that maintain market discipline and incentives across the board may be appropriate. Destroying the market is certainly not the answer.

Regards, Don
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