Government 1A Week 7

Prompt: “Who should have the authority to set prices, the free market or the state? Why?”

First of all lets break down the question into a more easily understood query. Who should set the prices of products, the person selling the product or an unassociated state representative? The obvious answer is the person selling the product, the free market.

First off, the business owner and the state representative have different information and very different motivations. The business man has the information of face to face communication with the customers. He can listen to the demands, compare them to other businesses in the area, and adjust products and prices accordingly to give the customer the most satisfying buying experience. The business owners motivation is to grow and expand the business, so in order to do this he wants the customers happy and returning to buy from him again.

Now the state representative has different information and motive. He has the information of charts and graphs. He has information collected by other representatives in and about the businesses in the area, about their products and prices. On first glace that may seem like more than enough information. He can look at the chart and see the prices of local business’s, then he may regulate the market and conform the prices. The idea behind this is it may create more competition, and let the strongest business’s succeed and advance in the economy. But the issue is the representative’s motivation. The representative wants to get paid. And who is going to pay the representative the most? The charming, quaint Mom and Pop shop down the lain? Or the enormous international corporation spreading and domineering every small town from here to Antarctica?

The answer is clear, the corporation is going to spread. And if that state representative can get a big handful of corporation cash, than the few bucks Mom and Pop can scrounge up starts looking a lot less appealing. Next thing you know Mom and Pop cant pay the state set taxes, and a week later their store is gone and replaced with a Walmart. The state representative isn’t interested in helping the locally produced, family run shops. They’re interested in the very biggest and strongest businesses, they want the businesses that can pay the most tax to prosper and grow. This leads to what we’ve been seeing in recent years: a Walmart, Target, or other large company appearing in every small town. You cant go twenty miles now without seeing Mickey D’s golden arches, or Toyotas overly bright advertising billboards. Some may see this as a convenience, but its killing all the tiny, soulful start up businesses. Or at the very least making it almost impossible to grow as large as they would otherwise.

In conclusion the state representatives setting the prices only leads to the rich gluttonous corporations cheating and manipulating the system for their own gain. It disrupts the natural order of economy. In an unaltered economy the business owner is in charge of their own destiny. They have the power to make wise or daft business decisions, and thus become popular or ignored by the customers. But if the state is in charge of the prices and decisions of the business, than only the biggest and richest businesses have any chance of growing.