The Department of Trade and Industry (DTI) has just released a list of what they call “Suggested Retail Prices” (SRPs) for food items that are in demand during the Christmas season.

I am sure that the DTI has good intentions in doing so, for the benefit of the general public, but it is in the accompanying warning in the announcement made that they may have made a mistake. According to the announcement, the DTI may file cases against traders who sell the said food items beyond what they “suggested.”

Pardon my saying so, but I think that an order that is made to sound like a “suggestion” is very similar to an “invitation” to a police station without an order in the form of a warrant of arrest. Assuming that the DTI will make good on their warning that they would file cases against the violators, what crime are they going to accuse them for? Are they going to arrest these people for violating a “suggestion”? And how are they going to drag the “accused” into the police station? Are they going to do that by way of an “invitation”?

Again I say that the DTI might have had good intentions in issuing such SRPs, but did it ever occur to them that the manufacturers of these food items are already issuing their own SRPs, and that the DTI really does not have to duplicate what these private businessmen are doing? It seems that the DTI is using the facade of issuing SRPs in order not to be accused of trying to enforce price controls, but no matter what language they are using, the bottom line is the same, they are actually trying to enforce price controls in a free market economy.

I am aware that this is a very sensitive issue, because this is a populist issue. As it usually goes, a populist issue would have the support of the majority of the population, even if it is essentially wrong or illegal. In this context, it could actually be said that Christianity is incompatible with democracy, because what the majority of the population wants is not necessarily doctrinally correct. That is so, because the determination of what is right or wrong in the Christian tradition is based on doctrines, and not based on what the majority thinks.

Whether we like it or not, democracy and capitalism are bound together like body and soul, even if they appear to have their distinct purposes as political and economic systems, respectively. That is the difference between democracy and communism, because in the latter, the political and economic components are bound together into one seamless system. As it is supposed to be, democracy and communism are two contradicting and opposing systems, and these are not supposed to be cross bred into hybrid systems whatever these could turn out to be.

In a free market economy, consumer prices are supposed to be dictated by the law of supply and demand, and not by the laws of the government. It is up to the manufacturers to sell their goods at whatever prices they want to, and it is up to the consumers to buy them or not. Under this system, the manufacturers face the risk of being priced out of the market, and therefore lose sales. Under the same system, the manufacturers are supposed to compete with each other by offering the best qualities at the lowest prices, in which case it is up to the consumers to buy what they want, or what they could afford.

Now here comes the issue of hoarding. In a free market economy, traders are supposed to be free to stock up on what they need to supply the demand for their products, that being the nature of their business, and there is nothing wrong with that. There is supposed to be no limit to what volumes of stocks that they could keep, that being their own lookout and that is really up to them, because it is their own money that they are using. In theory, they are supposed to make money when shortages happen, in a way becoming their own reward for their good foresight.

As it happens however, when there are shortages in the market, the DTI would usually accuse of hoarding the traders who have the large volumes of stocks, and on top of that, they are also accused of overpricing. As much as we would want to protect our consumers, we should also balance our populist concerns with the preservation of our democracy. We may not like the imperfect system of capitalism that we have now, but it is the only system that we have, because we are neither communist nor socialist.

Whether they are right or wrong, it is the majority that rules in a democracy. In that same vein, it should also be the majority of the consumer that should decide what the prevailing prices should be, by either buying or not buying whatever goods are sold in the market. Meanwhile, government agencies are not supposed to make their own laws that would defy the law of supply and demand, because not even the Congress has that power.

Just like King Canute, these agencies could not stop the waves of the market, and they might as well realize as they are as naked as the Emperor with no clothes.

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