“Speculation should be outlawed” is the argument for chapter 71 in How to Argue with a Liberal… And WIN! Let’s take a further look into this statement.
The meaning of the word speculation that is used in the previous phrase is: an activity in which someone buys and sells things in the hope of making a large profit but with the risk of a large loss. As you can see, this is not all that bad. The consumer has a choice to buy the product. If the consumer really wants it and the product isn’t readily available elsewhere he will pay a higher price.
Take for instance a famine. Foods that are available in areas that aren’t affected by the famine are going to be “imported” to the affected area. The sellers of the food will need to raise the price of the commodity due to the demand and also because they must cover the transportation costs while still making a profit.
If the government of the affected area were to outlaw speculation in order to keep the imported foods at the same normal price the government in turn would be increasing the shortage of food. Yes, the government would be trying to help the people financially, but the finances don’t really matter if you die from starvation in the end.
With the cost of the food remaining the same people are able to continue to buy without a thought- therefore they are not conserving the meager supply of food. If the food was sold at a higher price the citizens would have to consider their finances and save every last crumb of food available.
When the people don’t conserve and don’t consider the costs, they are wasting precious food. Wasting food isn’t a good thing to do while a famine is taking place, is it?
When people conserve food their food supply will last longer, therefore giving people more time to grow more food and recover from the famine.
Speculation is purely voluntary; you are not being forced to buy the higher priced product. Why should government be allowed to control people’s decisions about what price they pay for something?
If government were to outlaw speculation it would be yet another form of price control. We don’t want price controls. Remember Venezuela? (see https://allisonfessays.wordpress.com/2015/04/17/government-price-control-or-free-market-price-control/ )