Even autocrats are afraid of high prices. It's not because they can't afford them – having unfettered access to the public purse cushions inflation's blow. It's that rising prices can lead to instability…which can sometimes lead to autocrats being chased from office in the dark of night. (RELATED: Senate Democrats Unanimously Vote With China to Downsize US Economy)
What's a fearful strongman to do? If you are Belarus dictator Alexander Lukashenko, you issue a decree banning price increases, which history has repeatedly shown not only fails to do the job but makes matters much worse. As Lawrence Reed writes:
…the Babylonian king Hammurabi “smothered economic progress” with wage and price controls in 1750 B.C. Trade declined, and “the very people who were supposed to benefit” from the restrictions “were driven out of the market.”
For a time in ancient Greece, merchants were put to death for violating price controls, a fact which prevented them permanently from ever moderating price increases by adding to the supply of goods. “The Athenian government,” reported Schuettinger and Butler, even “went so far as to execute its own inspectors when their price-enforcing zeal flagged.” Inflation didn't disappear as effectively as either the merchants or inspectors did.
Similar results occurred later in the Roman Empire. Diocletian's famous price-fixing Edict of 301 ended in unmitigated disaster and the emperor's abdication. Quoting Livy, the authors of Forty Centuries note that “State intervention and a crushing fiscal policy made the whole empire groan under the yoke; more than once, both poor men and rich prayed that the barbarians would deliver them from it.”
And so on. What Mr. Lukashenko is very likely to get in return for stifling prices are shortages of goods and services, hoarding of certain essential goods and, that old standby, a flourishing black market.
As for the people of Belarus…they will get poorer, their tempers shorter and, if they are fortunate, their tolerance for Mr. Lukashenko's dictatorship will come to a permanent end. (RELATED: ‘Worm and Weasel' – King Charles Bans Harry and Andrew From Wearing Military Uniforms at Queen's Funeral)
The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.
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Face Revolution at home alone
Seems like dictators would learn that price-control is the path to disaster for the people and themselves.
Can’t fix stupid.