People living in capitalist countries, even if less than perfectly free, don’t think about it. As customers, they place orders with their suppliers. As producers, they satisfy the orders of their customers. Consumers are the bosses, producers are at their service. And producers happily accept this role because they want money to, in their turn, order goods as consumers on markets. A free rather than less free economy naturally organizes itself around this principle because we produce in order to consume and not the other way around.
For Christmas, you gave orders to your suppliers, not the other way around. A producer could not order you to buy from him. Only public producers—governments or suppliers backed by governments—can do this. French philosopher Raymond Ruyer, in his 1969 book Éloge de la société de consommation (In Praise of the Consumer Society), described the difference between a market economy, where the consumer is sovereign, and a planned economy, where the producer runs the show (under government’s control):
In a market economy, demand is imperative and supply is supplicant … In a planned economy, supply is imperative and demand is supplicant.
« Dans l’économie de marché, la demande est impérieuse, et l’offre suppliante … Dans l’économie planifiée, l’offre est impérieuse, et la demande suppliante. »
This is why, if you have the chance to live in a more-rather-than-less free society (and if you are not a hermit), you can have a happy Christmas.
Merry Christmas!
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Contrary to EconLog bloggers, Santa finds it difficult to paint letters
READER COMMENTS
Jose Pablo
Dec 24 2024 at 3:50pm
https://www.wsj.com/economy/trade/trump-warns-europe-to-buy-more-u-s-oil-and-gas-or-face-tariffs-1bc4d16b
A producer could not order you to buy from him.
Well, if the producer knows the right people in the right places …
Pierre Lemieux
Dec 24 2024 at 4:53pm
Jose: As I am sure you know, it’s a government (the US upcoming government) warning another government (the EU government) to warn/order “its” producers (the latter’s producer) to buy from the former’s producers. I wonder what Trump will think if he ever discovers that exports increase the domestic price of the exported product in the exporting country– despite his electoral promises to reduce the price of oil products! On a free market, private arbitrage does automatically this if it happens that oil prices are lower in the United States, thereby equalizing world prices. In a controlled economy, it would be the government authoritatively pushing up the price of a product for its subjects. In the 17th century, European governments (Louis XIV and Colbert in France, for example) forbade exports of grains when they wanted to prevent their domestic price from going up.
john hare
Dec 25 2024 at 6:34am
As in Obamacare? A criminal law in my mind.
Pierre Lemieux
Dec 25 2024 at 10:49am
John: To be fair, Obamacare forces one to buy insurance (like automobile liability insurance in most states), but does not force you to buy it from a government provider nor from any private insurer in particular. And it does not forbid private insurance (like in Canada, where only insurance complementary to monopoly public insurance is allowed). There is much regulation (to enforce minimum standards) and subsidization but no monopoly. It’s like the Swiss system, probably making the US and Switzerland the less interventionist public health insurance schemes in Western countries. (The Netherlands system may be similar, but I haven’t followed that in recent years.)
Roger McKinney
Dec 25 2024 at 11:40am
Wonderful! Merry Christmas!
Comments are closed.