May 7, 2012 | last updated June 4, 2012 12:10 pm
OTHER VOICES

Turning Connecticut into a people's republic

Chris Powell

Hastening Connecticut's transformation into a people's republic, the state Senate the other day approved a bill to prohibit merchants from charging "unconscionably excessive" prices during a weather emergency.

What constitutes an "unconscionably excessive" price, price gouging? The legislation leaves that to the Department of Consumer Protection, but presumably it will reflect nothing more than resentment of sudden scarcity.

The bill arises from last October's freak snowstorm, which caused a week of power outages throughout the state. Gasoline, snow shovels, certain food items, and repair services were in great demand and in some cases became much more expensive for a few days.

But that's only the basic economic law of supply and demand. In free markets, high prices are their own cure. So as long as supply and demand are the components of free markets, who's to say what an "unconscionably excessive" price is if not the market itself? And as time is money and always a calculation in price, who is to judge the urgency of a purchase and sale except the parties involved?

Government intervention in crucial markets may be necessary in grave emergencies, like wartime, when rationing has been imposed, but price suppression causes shortages. Did anyone starve, die, or suffer serious injury because of any high price after the October snowstorm? No, there was merely inconvenience.

But the anti-gouging legislation may be the least of state government's assault on free markets.

Selling out again to the most parasitic special interest, the General Assembly has just rejected Governor Malloy's proposal to repeal the ban on price competition in alcoholic beverage retailing and to establish a free market there. And when government in Connecticut isn't preventing competition in liquor retailing, it's imposing "project labor agreements" on government construction projects or requiring unionization of government employees — anything to defeat market pricing and run up costs.

These market-destroying policies are driving business, population, and prosperity out of state. So why not just outlaw snowstorms? While just as ridiculous, at least it would be harmless.

In the spirit of the anti-gouging bill, the state House of Representatives has just voted to raise Connecticut's minimum wage by 50 cents in two steps, reaching $8.75 in 2014. This is supposed to help working people. So why did the legislature and the governor last year enact the biggest tax increase in the state's history, including a retroactive increase in the state income tax? That tax increase hurt the great majority of working people in the state.

Only about 100,000 people in Connecticut earn minimum wage, but many if not most are unskilled young people doing menial labor. Part of the problem is that state government long has rejected the concept that salaries should correspond to the value of the work done.

But it's worse than that. As a supporter of raising the minimum wage, Rep. Ezequiel Santiago, D-Bridgeport, said: "The cost of living continues to increase. You have single parents trying to raise families on the minimum wage who are far below poverty level."

Indeed — but with tax increases government itself is raising the cost of living, and, if not also from government itself, where do unskilled single people get the idea that minimum-wage jobs can support whole families?

Chris Powell is managing editor of the Journal Inquirer in Manchester.

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