Morality by Legislation
Jeff Miller makes an excellent point - keeping prices high and inefficient companies in business is bad for the economy and unfair to taxpayers.
Consider this:
Prices for the flat screens in televisions, personal computers and cellphones have plummeted in recent years — but the decline would have been even faster if it hadn’t been for an international price-fixing cartel, the Justice Department said on Wednesday.
Three leading flat-screen producers — LG Display of South Korea, Sharp of Japan and Chunghwa Picture Tubes of Taiwan — pleaded guilty and agreed to pay a total of $585 million in criminal fines for their role in fixing the price of liquid-crystal display panels.
LG is paying the most: a $400 million fine, the second-highest criminal fine ever imposed by the Justice Department’s antitrust division… .
The price-fixing conspiracy, industry analysts said, was an effort to slow the speed of price declines. “These companies were trying to get a toehold to protect profits in a very difficult market,” said Richard Doherty, director of research at Envisioneering, a technology consulting firm.Now, let’s dig into the NYT articles to consider this:
The House narrowly rejected efforts tonight to eliminate Government price supports for peanuts and sugar, which critics contend cost American consumers billions a year.
In a vote reflecting regional farming interests more than partisan politics, the House by a vote of 217 to 208 defeated an amendment to phase out sugar price supports over five years. Earlier, lawmakers rejected an amendment to eliminate the peanut program by a 212-to-209 vote.And this:
But help arrived on May 13 when President Bush signed a 10-year $190 billion farm subsidy bill. It includes a new three-year $1.3 billion milk price-support program. On June 1, the guarantee price minimum will be $1.46 a gallon, 33 cents more than what farmers currently get under the market price set monthly by the United States Department of Agriculture. The new amount is still about a nickel less than the average farmer’s production cost for a gallon of milk.And this:
The nation’s farmers have been reaping their most bountiful harvest ever in many important crops, benefiting shoppers for groceries from meat to cooking oil but costing taxpayers an estimated $3 billion to $4 billion in additional farm subsidies.And this:
Wool producers will get about $105 million in Federal subsidies beginning on Wednesday to help compensate for low prices last year, the Agriculture Department said. The 1990 support price level as determined by Congress was $1.82 a pound of wool. But the average market price was only 80 cents a pound. Producers of mohair will also collect about $60 million for their sales last year. Mohair supports were slightly more than $4.53 a pound, while the market price averaged 93 cents.Lesson: It is absolutely, undeniably indecent and immoral to agree to keep price of a product artificially high … unless you get your Congressman to do it by force of law.
(This principle holds true in other areas as well … for example, it is absolutely, undeniably indecent and immoral to gamble, except for the state lotto)
Source: jeffmiller
