"Cuba ponders how to fix socialist economy"

[Victor Galis]

Originally posted by VJ
...then get rid of the government monopoly and allow invididual citizens to produce and sell the goods they are willing to create?

Because Cuba is socialist and revolutions are messy.

Universal price controls are not a new idea. The first time they were experimented under a close surveillance of a strong central government was way back when Emperor Diocletianus was ruling Rome. The experimentation was a spectacular failure exactly because the actual trade moved on to black market. Why people are still creating arguments to support price controls altough it failed in both theory and practice thousands of years ago is a mystery to me.

Price controls work best as temporary measures or measures to fight the power of monopolies. Getting rid of them doesn't always lead to good things: witness rolling blackouts in California a few years ago after electric deregulation.

[RGBVideo]

Because Cuba is socialist and revolutions are messy.

If Castro really would care about the welfare of his citizens, he would do what I proposed.

Price controls work best as temporary measures or measures to fight the power of monopolies.

Monopolies or cartels are fought with new small businesses which every citizen should be free to create. When monopolies and cartels notice a new kid on the block offering the products they produce with lower prices than they're using on a local area, they sometimes counter this by committing a conspiracy to lower the price temporarily and thus getting the small player out of business. This is exactly where the government steps in: the small business owner notifies anti-trust authorities of price fixing, and the government forces the cartel or trust to stop. There is never need for price controls if there is political will to enforce anti-trust laws, in a field of production where profits are huge, future competition and thus lowered prices are inevitable. Well, if there is a free market, of course.

Getting rid of them doesn't always lead to good things: witness rolling blackouts in California a few years ago after electric deregulation.

Pardon my ignorance, but were there really price controls in California in the '90s on energy suppliers in the same sense there are currently price controls on consumer goods in Cuba? I thought state government got rid of regulations and federal government got rid of trust (or cartel) oversight which lead to a single corporation (which had made millions of dollars of campaign contributions to both state and federal governments) making hundred of millions of profit?

[Victor Galis]

Originally posted by VJ

If Castro really would care about the welfare of his citizens, he would do what I proposed.

No he wouldn't. The transition period is very messy. Gradual change is key.

Monopolies or cartels are fought with new small businesses which every citizen should be free to create. When monopolies and cartels notice a new kid on the block offering the products they produce with lower prices than they're using on a local area, they sometimes counter this by committing a conspiracy to lower the price temporarily and thus getting the small player out of business. This is exactly where the government steps in: the small business owner notifies anti-trust authorities of price fixing, and the government forces the cartel or trust to stop. There is never need for price controls if there is political will to enforce anti-trust laws, in a field of production where profits are huge, future competition and thus lowered prices are inevitable. Well, if there is a free market, of course.

Or the monopoly uses a variety of other less savoury methods. Sometimes the natural barriers to entry are so high that new small businesses won't fare any better.

Pardon my ignorance, but were there really price controls in California in the '90s on energy suppliers in the same sense there are currently price controls on consumer goods in Cuba? I thought state government got rid of regulations and federal government got rid of trust (or cartel) oversight which lead to a single corporation (which had made millions of dollars of campaign contributions to both state and federal governments) making hundred of millions of profit?

You're suggesting deregulation, which failed miserably in California. Allowing the "free" market to take over was worse than price controls.

[RGBVideo]

Or the monopoly uses a variety of other less savoury methods.

Which all can be taken care by anti-trust law enforcement.

You're suggesting deregulation, which failed miserably in California. Allowing the "free" market to take over was worse than price controls.

You didn't answer my actual question.

Pardon my ignorance, but were there really price controls in California in the '90s on energy suppliers in the same sense there are currently price controls on consumer goods in Cuba?

[Victor Galis]

Originally posted by VJ
You didn't answer my actual question.

As far as energy is concerned, yes. A price control is a price control, unless the price is above market price at which point a price control is either meaningless or a guard against temporary price spikes.

[RGBVideo]

Any links to details? It's hard to google more than decade old legal rules from a specific area.

[Victor Galis]

Originally posted by VJ
Any links to details? It's hard to google more than decade old legal rules from a specific area.

After reading dozens of assertions about how all the problems would go away if capitalism were adopted, you want details?

[RGBVideo]

Details of the energy price controls existing in California before the Enron scandal.

[Spiffor]

Originally posted by VJ
...then get rid of the government monopoly and allow invididual citizens to produce and sell the goods they are willing to create?

Already introduced. There are autonomous companies, which are managed by the workers if there are more than 5, and which is managed by an "owner" if there are less than 5 workers.

The decentralisation of the economy is introduced at a slow pace, precisely in order to avoid the disastrous transition period that hit most of central and Eastern Europe, and that is still hitting Russia today.

[MichaeltheGreat]

Originally posted by Zkribbler


Y'know Kuci...someday you should have someone explain to you how being obnoxious is not the same as being clever. I don't think you know the difference.

It comes down to one question, which, incidentally, is one of the all-time best bar-fight starters:

Do you know the difference between a smartass and a dumbass?

No matter how someone answers that, they're done.

[Sikander]

Price controls lead to / exacerbate shortages. Fact.

[Kuciwalker]

Price controls lead to / exacerbate shortages - FACT

Fixed.

[Kidlicious]

Originally posted by Kuciwalker


There's already one, as I've said several times already. It's just right now, in addition to their profit, they have to skim extra off for bribes.

No, they're recieving income for their services. Profit, is income you recieve for someone elses services because you control the means of producing the services.

[Kidlicious]

Originally posted by Sikander
Price controls lead to / exacerbate shortages. Fact.

True, but shortages can be a better situation if consumers get more benefit.

[Kontiki]

Originally posted by Kidicious


No, they're recieving income for their services. Profit, is income you recieve for someone elses services because you control the means of producing the services.

That would only be the case (and debatebly so at that) for services. There also seems to be a large issue of skimming and/or stealing goods and selling them on the black market. That's 100% pure profit.