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“Orbán used to be one of the biggest anti-communists; now he’s making us all feel like we’re living under communism again,” a Hungarian student activist told me last week at European Liberty Forum. He referred to Viktor Orbán, the Hungarian Prime Minister, attempting to control inflation by capping the price of essential goods like food, mortgages, energy, and fuel.

I laughed along secure in the knowledge that at least the British government, for all its faults, would not go that far. Unfortunately, within just a few days my new Hungarian friend may have gotten the last laugh. In an ironic twist of timing, last weekend it emerged that the UK government is contemplating a ‘voluntary’ price cap for supermarket essentials.

Prices are not just made-up numbers. As Hayek explained, ([link removed]) they contain dispersed knowledge about market conditions and transmit tacit information about preferences, efficiently coordinating the economic activity of billions. Interrupting this process can be disastrous. In this case, controlling prices for some goods could lead supermarkets to make up for lost margins by increasing prices or reducing the quality and quantity of their offering.

Higher prices also perform a vital function by communicating to producers that consumers want more of a particular good, as I discussed in CapX this week ([link removed]) . This was recently demonstrated in the United States when egg prices shot up at the end of 2022, prompting calls for price controls and regulation of ‘big egg’ to stop the so-called ‘greedflation’. Thankfully, these calls were resisted, and the price of eggs cratered in the first quarter of 2023. If that mechanism is blunted, the incentive to find ways of producing more food is stymied. As Venezuela’s recent history has shown, embracing price controls can quickly lead to chronic shortages and widespread starvation.

This last week is just another reminder of the importance of remaking the case for free market principles. Thankfully, the IEA has been on the case for many years. In 2015, we published Flaws and Ceilings: Price Controls and the Damage They Cause ([link removed]) , a 227-page book on the topic. We were back across newspapers and the airwaves this week reiterating these points.
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IEA Economics Fellow Julian Jessop’s critique of price controls was carried far and wide across the media, featuring in publications ranging from The Daily Express ([link removed]) to The Guardian ([link removed]) and i News ([link removed]) to The Financial Times ([link removed]) and The Telegraph, as well as on broadcasters including BBC News ([link removed]) .

It is notable that the government has been silent on price controls since the weekend —perhaps the tide is beginning to turn against the misguided and short-termist economic approach.

Harrison Griffiths

IEA Communications Officer
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** Nanny State Index 2023
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This week, the IEA and EPiCENTER released 2023’s Nanny State Index.
* Edited by IEA Head of Lifestyle Economics Christopher Snowdon, the index ranks thirty European countries based on their policies towards tobacco, vaping, alcohol, food and soft drink.
* For lovers of freedom, the results are dire. With few exceptions, all the countries surveyed are moving in a more statist direction.
* The most draconian state on this year’s list was Turkey, which consistently scored the lowest on all criteria, while the freest country was Germany.
* The UK took 11th place, up by one spot since the last ranking in 2021. Britain has the most restrictive tobacco regulation in Europe – the only saving grace being a relatively liberal approach to vaping.

The Daily Express prominantly covered ([link removed]) the Index, including an opinion piece from Christopher and an editorial declaring that “It’s time the Government stopped treating us as childen.”
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Christopher wrote in The Spectator ([link removed]) that “Liberalisation is as rare as hen’s teeth. Everything is moving in the direction of more state control of people’s private lives.”

Christopher also wrote for The Critic ([link removed]) , highlighting the undue weight placed on lifestyle restrictions in public health policy.
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Christopher also discussed the index with Mike Graham on TalkTV ([link removed]) . The research was covered in The Daily Telegraph ([link removed]) , The Times, The Daily Mail ([link removed]) and The Scottish Daily Mail, along with various European publications.

Christopher also discussed the results on this week’s podcast with IEA Director of Public Policy and Communications Matthew Lesh.
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Read the full report ([link removed])

IEA Latest.
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** Arbitrary way of allocating school places is turning parents into liars ([link removed])
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Director General Mark Littlewood, The Times

Schoolboy error… The allocation of school places by catchment areas forces concerned parents to lie about where they live. The introduction of a voucher system could empower parents and improve educational quality.
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** The Road to Serfdom: Was Hayek right? ([link removed])
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Academic and Research Director Dr James Forder chairs a panel discussion on Friedrich Hayek, IEA YouTube

The great debate... With Friedrich Hayek’s seminal work, ‘The Road to Serfdom’, nearing its 80th anniversary, the IEA assembled a panel to discuss the question of whether Hayek was right. The discussion included Professor Mark Pennington from King’s College London, the IEA’s Dr Kristian Niemietz, and Telegraph columnist Sherelle Jacobs.
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** Should we scrap inheritance tax? ([link removed])
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Economics Fellow Julian Jessop and Matthew Lesh

Ditch the death tax... The Daily Telegraph has launched a campaign calling for the abolition of inheritance tax. Julian Jessop’s calculation, ([link removed]) that around 60,000 estates could face an increased 40 per cent rate by 2033, featured on the front page. Matthew Lesh also criticised the levy and called for it to be slashed on LBC ([link removed]) and TalkTV.
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** It’s time to create a free market in education ([link removed])
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Senior Research Fellow Dr Jamie Whyte, ConHome

Ready, set, reform… Privatising the UK’s education system would ease the burden on state schools and give parents greater choice over their child’s education.
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** We shouldn’t take those predicting the AI doomsday too seriously ([link removed])
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Matthew Lesh, CityAM

Beware false prophets… Artificial intelligence has many doomsayers worrying about humanity’s downfall, but should we listen to them? Imposing heavy-handed regulation risks crushing the immense social good that AI can bring.
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** Half-Term disruption ([link removed])
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Editorial and Research Fellow Professor Len Shackleton, GB News

Union militancy... Recalcitrant rail workers are continuing to disrupt lives across Britain and as railways continue to lose money, it is time to talk seriously about reform.

IEA Insider.


** IEA Book Club
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** IEA Book Club with Paul Johnson ([link removed])
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Date: Wednesday, 7 June

Time: 5.30pm — 7.30pm

Location: 2 Lord North Street, SW1P 3LB

RSVP: There are limited spaces avaliable for non-members, please click here to apply by email (mailto:[email protected]?subject=IEA%20Book%20Club%20with%20Paul%20Johnson&body=Hello%2C%20I%20would%20like%20to%20attend%20the%20IEA%20Book%20Club%20with%20Paul%20Johnson%20on%20Wednesday%2C%207%20June%20at%205.30pm.%20Could%20you%20please%20reserve%20me%20a%20space%3F) .

The IEA Book Club will host Director of the Institute for Fiscal Studies Paul Johnson on his latest book, 'Follow the Money: How Much Does Britain Cost'. Matthew Lesh will chair this event.

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** IEA Book Club with Ross Clark ([link removed])
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Date: Tuesday, 13 June

Time: 17:30 – 19:30

Location: 2 Lord North Street, SW1P 3LB

RSVP: There are limited spaces avaliable for non-members, please click here to apply by email (mailto:[email protected]?subject=IEA%20Book%20Club%20with%20Ross%20Clark&body=Hello%2C%20I%20would%20like%20to%20attend%20the%20IEA%20Book%20Club%20with%20Ross%20Clark%20on%20Tuesday%2C%2013%20June%20at%205.30pm.%20Could%20you%20please%20reserve%20me%20a%20space%3F) .

The IEA Book Club will host journalist Ross Clark on his latest book, 'Not Zero: How an Irrational Target Will Impoverish You, Help China (and Won’t Even Save the Planet)'. IEA Energy Analyst Andy Mayer will chair the event.

There are limited spaces available for both book club events, if you would like to attend please apply by emailing (mailto:[email protected]?subject=null&body=null) or find out more about joining the IEA Book Club ([link removed]) .
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