What you pay is not the real price

Guy walks into store to buy cigarettes, and says, “they’re so expensive!” Counter guy goes, with grinning, righteous virtuosity, “it’s an expensive habit!” I wasn’t going to let him get away with that. I said from the back, “no, it’s not!” Counter guy, “Well, it’s twelve dollars.” Me, “It’s an artificial government price.” He shrugged his shoulders and scoffed, “If you say so.”

But it is true. Any addiction or habit is expensive even if the product you buy is cheap, but that’s on you. But to call something an expensive habit because government has raised the price artificially through taxes is an affront to reality. Cars by themselves are not that expensive. They would be 10, even 20 thousand dollars cheaper if it wasn’t for all the taxes, tariffs and regulations imposed on car makers. Whatever you think you’re paying now for your stuff is not due to your demand for it in most cases. They’re due to government interference.

Some people need a lesson in government-based economics, and know that the price they’re paying for their stuff is not the real price, but has been inflated by the hand of government. Go anywhere where the hand of government has not reached, you’ll find yourself paying far less. The black market is a good example of that. While the black market can make things more expensive, it can also make things cheaper in the areas where there is government interference.

One of those things are cigarettes. You’ll have a hard time finding a guy selling cigarettes from his house more expensive than you would find them at your local gas station. A product only becomes more expensive if it is illegal, and oftentimes more dangerous and of less quality. A true lesson in economics is necessary in our society. How often don’t we stop at a store and look at the price of an item and blame the price on the greed of the seller?

We rarely realize that greed may not be playing the major role in the price, but opportunity combined with taxes along with the additional regulatory costs of conducting business. No savvy businessman or woman will sell an x-chocolate bar at 5, 10, or even 100% more than the guy next door without offering cheaper prices for other in-demand items elsewhere in his or her store.

But with higher taxes, often inflated on particular items a state or city considers a “high risk to consumers” such as cigarettes, and the higher cost of doing business through regulations—which raises the price of the location and the profits of the business, no matter how cheap an item is—it will never be as cheap as it could have been if it was all left to competition and not to the tax man and the regulatory agency.