Can you say, “fluctuating prices?” I hope so, because this is the key to creating wealth in America, something Pres. Obama’s plans don’t consider. The need for price communication is a key axiom of economist Friedrich Hayek and the Austrian School of economics.

Friedrich Hayek (1899 – 1992) was an Austrian-British economist and philosopher known for his defense of classical liberalism and free-market capitalism against socialist and collectivist thought. He is considered to be one of the most important economists and political philosophers of the twentieth century and one of the most influential members of the Austrian School of economics.

 Fluctuating prices, or “price communication,” is key to maximizing wealth thru efficient distribution, as Hayek teaches us.  The information garnered from market pricing tells us how much society values something.  Price controls and subsidies distort incentives and misallocate resources by making us deaf to this important price information.

Enabling price communication through fluctuating prices should be forefront when considering all economic issues. This is because price controls, or price tampering through subsidies, for anything, is harmful and shrinks the overall economic pie, while favoring politically connected groups.

Jeff E. Jared, Kirkland