Monday, September 05, 2005

Economics = 2 + 2

Yes, I know economics is called the "dismal science". I know university instructors and political appointees a la the President's Council of Economic Advisors have turned it arcane, cryptic, boring and untranslatable. But it's really easy, so simple once you get a few principles down. I once heard it referred to as the "rationing of finite resources". That was in relation to health care, which is definitely being rationed today. The speaker said -- and I paraphrase -- that America used to have the "Lexus of health care", by which he meant access by all to the best health care in the world regardless of income and regardless of who-you-know. Now health care appears to be a question of Who-You-Know who can bump you to the front of the queue.
But my thoughts turn to the Katrina aftermath and further back to Ivan, Bette and earlier ones. I remember a great hue-and-cry about how merchants were "gouging" and taking advantage of human misery in raising their prices on necessities like chain saws, bottled water, ice, etc. Well, let's take a typical scenario. A hurricane has just struck; there is widespread devastation; shortage or nonexistence of essential supplies. A 7-11 has a finite supply of bags of ice and bottled water. If, at the time of the disaster, the ice bags are 99 cents and the bottled water is $1.97 each, if the merchant doesn't raise his prices, what is going to happen? The first hurricane victim who reaches the 7-11 is going to buy up the entire supply and there will be an instant shortage. Every victim after the first lucky one to arrive at the 7-11 is going to be SOL. Rationing of finite resources has to happen in order for every victim to have at least one bag of ice and one bottle of water.
There are some who say the market should decide how resources are rationed; there are many others who say the government should decide. The government advocates say the market should not decide because it isn't sensitive and caring towards The People the way government is, never acknowledging the truth that politics is nothing more or less than Who You Know, who can get you to the front of the line! The market is impersonal, unfeeling and plays no favorites. If you can purchase it -- whether you're white, black, Aleusian, Eskimo or Native American -- it's yours.
Listen to tales of FEMA incompetence, GOP chumminess with its big donors and callous indifference of Homeland Security chief (and Lenin-death's-head lookalike) Chertoff to American (as opposed to Israeli) suffering and the market should win out every time.

1 comment:

Mitchell Lopate said...

Hang in there, Brad. Money will soon be VERY useful: for starting a fire after the economy collapses, much like it does for all empires.