Yes, this is theoretically true in a perfectly efficient, frictionless market, but it is not true in the real world, particularly for food. There is a ramp-up time for food production, so it may not be possible to meet increases in demand with increased supply in a timely fashion. Aside from that, food production is subject to exogenous shocks (such as frosts or droughts), which means in the real world, it’s problematic to get close to this ideal market.
But, let’s assume for a moment that the food market was really that efficient in 1941. During the hoarding period (before the prices come back down), people may not be able to afford food at the inflated prices. For sugar, it might not be that important, since people can survive without sugar. But if you want make sure that the entire population gets its basic nutritional requirements (which I imagine would be really important during a war), then you can’t risk this sort of hoarding. Telling us that prices will eventually come back down and the food will eventually be dumped back on the market doesn’t actually address the problem that rationing was trying to solve.
Anybody who thinks the free market will solve all problems needs to look at the world diamond market. It’s a real world example of how supply and demand can be manipulated over a period of decades without the invisible hand being able to stop it.
Shortages can occur not just because of lack of the relevant material. And a lot if the time it does not occur due to shortage.
If you have a massive food surplus, it does not help you much if you don’t have sufficient transport to get them from food producing areas in time (most foods are perishable items) nor the ability to store long term.
US transport infrastructure during the war was committed to the war effort. Most new vehicles were sent to that, Storehouses were also being used for war material.
If you have 200 tonnes of sugar, but only 2 ten ton trucks to transport them , with perhaps limited petrol/diesel, tires, spares and no warehousing ability well there is going to be a shortage of sugar for consumers, actual amounts be damned.
Generally speaking, the free market is championed by those who have made their pile from it and would have had a smaller pile (down to zero) if regulation and ethics had interfered.
I have no objection to a free market. But I disagree with the people who think it’s a natural phenomena. A free market generally exists only when there is a structure around it - like a government - that is working to maintain its existence. It takes a lot of planning and regulation to have a free market.
I would completely agree - I am pro-capitalist, pro-free markets and pro-wealth… but only within a framework that prevents these things from being oppressive or predatory. All represent proven, workable systems… but ones that are prone to eating the lives and rights of the lower tiers. Darwinism should not be the model for economic systems.
Most people who wave the “free market” banner mean *no *regulation or oversight, because invisible hand.
I agree alot had to do with getting the whole country involved.
Buy war bonds. (Then after the war people were praised for not cashing them in)
Turn in your scrap metal.
Work hard, dont go out on strike.
Loose lips sink ships.
Rationing is good for everyone.
Now in Vietnam they tried to go another path. Instead of rationing they almost went out of their way to act like their wasn’t a war going on. “Guns and Butter” I think they call it.
On a related note, during WW2 is when they pushed people to start eating liver.
The diamond trade has never been a free market. For most of the last two centuries, it was a monopoly, and even today is is an ologopoly, with governments actively colluding with the mining companies to suppress competition.
It is not an example of the problems of capitalism. It is an example of the problems of mercantilism. The free market did not fail. It never developed in the first place.