Posted on 12/07/2005 4:08:03 AM PST by T-Bird45
My nomination for best line in the article: "Zero-sum games are transactions mostly initiated by thieves and governments."
May the wisdom of Dr. Williams and Dr. Sowell ever increase and abound.
NO ONE can explain the principles of economics like Dr. Williams. He's the best. Anyone with a brain can understand his explanations.
Good article, but my question would be, should there be no laws for price gouging?
In other words, the state Attorney Generals charge motels for price gouging after a hurricane, and Home Depots would be charged if they increased the price of a generator because the demand exceeded supply, post hurricane.
Why are those instances not "good good exchanges," just like the gas/$$ exchange...it is supply and demand, after all.
Hotel rooms are scarce, price goes up; generators are scarce, price goes up. I don't have to have a hotel room (I could sleep in my car); I don't have to have a generator, (I could do without electricity.)
I don't see a difference, why are some things considered price gouging and others aren't.
Common sense is not necessarily correct, and this explanation is worthy of a kindergardener. His comment "If I voluntarily purchase the gas, I do so because I deem it better than my next best alternative" is so full of false assumptions as to be laughable. So there is almost nothing free market about my choice to purchase gasoline in comparison to alternatives to getting around.
It's a shame that these two men (Williams and Sowell) cannot be coerced into running for public office.
Absolutely right. The best cure for high prices is ... high prices
I agree.
And that's always been my issue. How come they charge some companies with price gouging, and then say gasoline prices are just a result of supply and demand.
Fair for the goose, fair for the gander...supply and demand is supply and demand.
Nice one sentence summary of reality, but he repeats himself.
Walter Williams teaches at my alma-mater. Although I never took one of his classes, I had friends who did. The one thing they remember from the class was that it was hard work. He teaches economics and doesn't use his classroom as a forum for his views. Everyone I know who took his class came out believing they had learned something.
Dr. Williams' normally crisp writing is suffering from a little redundancy here. :-)
And I'm repeating you. I should hit reload one last time before posting a comment. :-(
"Common sense is not necessarily correct, and this explanation is worthy of a kindergardener. His comment "If I voluntarily purchase the gas, I do so because I deem it better than my next best alternative" is so full of false assumptions as to be laughable. So there is almost nothing free market about my choice to purchase gasoline in comparison to alternatives to getting around."
Your alternatives to buy gass are almost limitless. They are not all practical. You could walk to work. No? Get a job closer. You could buy a horse. You could take a bus, a cab, a ride, hitchhike, etc. What you are actually saying is that the alternatives are not practical and you would never dream of it. Therefore you are forced to buy gasoline. If the price went to $100/gallon, I promise, you would find a way to exist in life without it, as would we all. By the same token, the market would correct itself pretty quick with all sorts of profitable alternatives. There is a threshold of pain you will tolerate. You have demonstrated by your comments that you are not even close. Neither am I.
The higher prices and profits are suppose to attract more competitors in the market. Do you know why they don't? Because our country makes it illegal or at least unprofitable to start a business that produces or refines oil. We cannot harvest any new oil because of environmental laws and groups.
It actually is all about supply and demand until government decides to affect some part of the equation. And now you can see the impact of the government getting involved.
AJ said: "explanation is worthy of a kindergardener"
Allow me to repeat myself that this level of understanding is sorely lacking in most politicians thus it is appropriate that Dr. Williams article should appear to be so basic.
AJ said: "full of false assumptions as to be laughable"
Specifics are the soul of cogent discussion. What are the false assumptions you perceive?
AJ: "So there is almost nothing free market about my choice to purchase gasoline in comparison to alternatives to getting around."
No, it is just as Dr. Williams said -- you recognize the options/alternatives, have considered the consequences, and chosen the best alternative for you. If it was any other way, then force was involved and it was no longer a true free market choice. You may state that you have to get around to work so you can have the funds to take care of your needs but the work you pursue is still a choice, assuming you are not assigned to a slave labor camp.
*
Humor me. How do you figure that you are not making voluntary purchase decisions for gasoline? Is a Shell employee holding a loaded revolver to your temple and reaching out for your wallet?
One thing never mentioned in these gas price threads is that a person might choose to save money for a time of need. Yes, instead of buying that plasma TV you can put the money aside and then when gas goes to 3$ you have lots of money with which to buy the gas.
But what people tend to do is buy the Plasma TV and lots of other stuff and have not much money in reserve. Then when necessities get expensive after a disaster of some sort, want someone else (taxpayers who then do with less) to come to their rescue. The result is the taxpayers sacrifice so that bubba can have his toys.
Talk about putting words in someone's mouth!!!! I am a firm believer in a free market approach to the production, delivery, and sale of energy products. In fact, I believe in a free market approach to the delivery of all non-public goods.
I am merely pointing out that it is laughable if anyone thinks that the current market for the delivery of transportation and transportation fuels is not largely determined by government choices, policies, and regulatory processes.
I am not advocating that the government step in and further regulate prices. But Williams is naive if he thinks that when I buy gas at the gas station it is a free market transaction that I am free to decline in any meaningful sense. I can also decline to pay my taxes, and if I don't buy gas to get to work to pay my taxes, I will land myself in a lot of hot water. No it is not a free choice at all.
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