This piece by Tony Wright nearly 6 years ago is a window into why we have inflation now. And not just ‘high…

This piece by Tony Wright nearly 6 years ago is a window into why we have inflation now. And not just ‘high gas prices’, it’s a process thing. What does business do, to control costs? It signs contracts. A type of privatised regulation. /1 https://t.co/qAbgTkBTrb

The gas exporter contracts are hopeless for Australia, due to both congenitally and ideologically useless leaders, from both sides. High vis is like a flame to a moth, for modern popularity pollies. But business is here teaching us something critical. /2 https://t.co/RVim3JaVLc

It doesn’t want high prices either, for the things it buys. So it signs agreements, contracts. It regulates supply. In this case very well, and Australia has been more or less giving its gas away, due to idiot politicians. Started by the great anti-regulator, John Howard. /3

Read in Wright’s article, how Howard refused to talk about reserving supply for Australian use, for fear of upsetting the market. The same market the gas exporters completely ignored, in regulating supply and price via the agreements with us. /4

This idiot anti-State, anti-regulation ideology that has dominated Western democracies tries to convince us that the market and business can do it better. But the market and business regulate all the time. They wouldn’t function otherwise. Their gas price is low, and assured. /5

Ours keeps going up, driving prices up anywhere energy is crucial, which is everywhere. Because we *didn’t* regulate. But they did. This is the story of privatisation forever. ‘De-regulating’ just sets up new regulation, in private hands. Nothing functions without regulation. /6

By far the smartest way to regulate is to use economies of scale, and do it centrally, via democratic government. Which then cascades down through all of the nooks and crannies of society, including business. Creating standardised conditions for business. /7

if you don’t do that, and leave it all to the ‘market’, you’ll get a proliferation of competing regulation, all the contracts and agreements set up in private hands to provide basic public services. Each will try to create the best possible terms, for themselves. /8

Meaning prices will inevitably go up. Everywhere. Not because of greed or ‘capitalism’ or any of that nonsense. But for the simple, practical reason that nothing is being properly regulated. The anti-State folk like to paint regulation as oppression. /9

Without regulation, there is no business, no ‘economy’. Business employs thousands of lawyers, to do the regulation needed to keep business running. To create standardised conditions for business. They create controlled ‘supply chains’, to regulate their supply and prices. /10

It’s regulation, everywhere. But because elected fundamentalist nongs in politics think the market is a regulation-free zone, all of this regulation isn’t coordinated at the top level, so over time prices creep up, everywhere. Nothing about supply and demand. /end