politics that aims to put democracy in control of markets
No, really, no thank you.
Let us consider a simple market, one for bread, the staff of life.
We vote for the price of bread to be 50p ….but that doesn\’t mean that the price of bread will be 50p. If the market clearing price is in fact £1 then voting for the price to be 50p means that there will be no (or little perhaps) officially and legally available bread and on the black market the price of a loaf of bread will be…..£1.
If the market clearing price is 25p then huge amounts will be produced at 50p and we\’ll have bread mountains, just as we\’ve had butter mountains, wine lakes and sheds full of frozen cows.
The only way this works is if we democratically decide that the price of bread is in fact the same as the market clearing price. At which point, why not simply use the market to determine that?
Which, given that the market clearing price continually changes, in response to changing tastes, wheat harvests, inflation in general and whether Julia has brought out a book on how to make sandwiches seems like a pretty sensible idea really.
Or, to adapt a favourite phrase, you can ignore markets but that doesn\’t mean that markets are going to ignore you…..or your democratic votes.