Cartoon of the Day: Prices are Evil

From Karen De Coster:

Raising prices is “gouging.”

Lowering prices is “predation.”

Keeping them the same is “collusion.”

Cutting costs is “scheming.”

So for governments, market prices signify a ‘damned-if-you and damned-if-you-don’t’ thing.

Yet without the pricing system there won’t be economic calculation which functions to coordinate or discoordinate the distribution of resources.

As Ludwig von Mises aptly pointed out.

A government that sets out to abolish market prices is inevitably driven toward the abolition of private property; it has to recognize that there is no middle way between the system of private property in the means of production combined with free contract, and the system of common ownership of the means of production, or socialism. It is gradually forced toward compulsory production, universal obligation to labor, rationing of consumption, and, finally, official regulation of the whole of production and consumption.

The Bolsheviks have tried this and failed, from the PBS.org (bold emphasis added)

1917-1920: With the October 1917 revolution, the Marxist concept of the moneyless economy becomes a desired goal, but not yet a practical one. The Bolsheviks nationalize the banks, but make no attempt to restrict inflation. With the destruction of the market economy, inflation soars, and money becomes virtually valueless. A black market based on barter develops to fill the vacuum.