An Exercise of Futility

The government is refusing the industry’s request to allow the selling price of general purpose (wheat) flour to increase from the current RM1.35 per kilogram. The request follows an increase in the price of wheat, imported from Canada and the United States, from US$235 to US$40 per tonne. At the same time, the government reassures the public that the supply of flour will not be affected.

LOL.

Good luck trying to fight market forces. The only way the government can guarantee the supply of flour at the current selling price is by subsidizing the industry. More subsidies, yeah, right.

If I’m not mistaken rice, not bread, is the staple food of Malaysians. Why can’t we simply abandon price control?

Price controls distort the market and incur high costs to enforce, but ultimately when it really matters, they usually don’t work anyway. Politicians should really not make promises they cannot keep.

But that’s really what it is all about, isn’t it?