Manufacturers Should Be Free to Set Their Pricing Policies
By David Holcberg (Washington Times, April 4, 2007)
Manufacturers have a moral right--and should have the legal right--to set the retail price of their products ("U.S. Supreme Court hears pricing case," March 27). As the legitimate owners of their property, manufacturers--as any other sellers--have a right to set the terms of sale of their own products. If a retailer does not agree with the terms of sale set by a manufacturer, if he judges the terms to be unreasonable or unprofitable, he is free to reject the manufacturer's terms and seek other suppliers with different pricing policies.
To properly answer the question of what price to charge requires that a producer make difficult, consequential judgments.
If a manufacturer sets his prices too high, he loses customers and risks a sharp decline in sales. If he sets his prices too low, he cuts his profits and may even take a loss. Setting prices at the right level is a difficult task for any manufacturer, a task he must be free to tackle without government interference.
The objection that consumers are harmed by certain pricing policies is groundless. Consumers are under no coercion to buy anyone's products. They aren't harmed by a manufacturer's decision to set his prices as he sees fit.
If they judge a product to be too expensive, they can go their own way, unharmed and free to shop elsewhere. Just as a manufacturer has no right to force consumers to pay the price he wants, consumers (or government officials) have no right to force a manufacturer to sell at the price they want.
The fact that a manufacturer may be punished under antitrust law for setting the retail price of its products indicates the irrational and unjust nature of antitrust law. We can hope for the day when the Supreme Court will no longer condemn innocent companies for violating antitrust law, but instead will condemn antitrust law for violating the rights of the innocent.