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Traditional Catholic Faith => Catholic Living in the Modern World => Topic started by: Cryptinox on July 16, 2022, 09:59:12 AM
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I am curious as to how just price determined. With modern economics this seems harder to determine. St. Thomas Aquinas taught the following:
"it is contrary to justice to sell goods at a higher price than their worth, or to buy them for less than their value"
Where this gets complicated is used items that can vary by hundreds of dollars. I know Aquinas is not condemning any profit on goods but this is pretty confusing as is theology on economics for me.
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I am curious as to how just price determined. With modern economics this seems harder to determine. St. Thomas Aquinas taught the following:
Where this gets complicated is used items that can vary by hundreds of dollars. I know Aquinas is not condemning any profit on goods but this is pretty confusing as is theology on economics for me.
For used items, whatever someone will pay for them is just.
For new items, generally whatever the market will bear, I think.
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Question 77. Cheating, which is committed in buying and selling
- Unjust sales as regards the price: namely, is it lawful to sell a thing for more than its worth? (https://www.newadvent.org/summa/3077.htm#article1)
- Unjust sales on the part of the thing sold (https://www.newadvent.org/summa/3077.htm#article2)
- Is the seller bound to reveal a fault in the thing sold? (https://www.newadvent.org/summa/3077.htm#article3)
- Is it lawful in trading to sell a thing at a higher price than was paid for it? (https://www.newadvent.org/summa/3077.htm#article4)
Article 1. Whether it is lawful to sell a thing for more than its worth?
Objection 1. It would seem that it is lawful to sell a thing for more than its worth. On the commutations of human (https://www.newadvent.org/cathen/09580c.htm) life, civil laws determine that which is just. Now according to these laws it is just for buyer and seller to deceive one another (Cod. IV, xliv, De Rescind. Vend. 8,15): and this occurs by the seller selling a thing for more than its worth, and the buyer buying a thing for less than its worth. Therefore it is lawful to sell a thing for more than its worth.
Objection 2. Further, that which is common to all would seem to be natural (https://www.newadvent.org/cathen/10715a.htm) and not sinful (https://www.newadvent.org/cathen/14004b.htm). Now Augustine (https://www.newadvent.org/cathen/02084a.htm) relates that the saying of a certain jester was accepted by all, "You wish to buy for a song and to sell at a premium," which agrees with the saying of Proverbs 20:14 (https://www.newadvent.org/bible/pro020.htm#verse14), "It is naught, it is naught, saith every buyer: and when he is gone away, then he will boast." Therefore it is lawful to sell a thing for more than its worth.
Objection 3. Further, it does not seem unlawful if that which honesty demands be done by mutual agreement. Now, according to the Philosopher (https://www.newadvent.org/cathen/01713a.htm) (Ethic. viii, 13), in the friendship which is based on utility, the amount of the recompense for a favor received should depend on the utility accruing to the receiver: and this utility sometimes is worth more than the thing given, for instance if the receiver be in great need of that thing, whether for the purpose of avoiding a danger, or of deriving some particular benefit. Therefore, in contracts of buying and selling, it is lawful to give a thing in return for more than its worth.
On the contrary, It is written (Matthew 7:12 (https://www.newadvent.org/bible/mat007.htm#verse12)): "All things . . . whatsoever you would that men should do to you, do you also to them." But no man (https://www.newadvent.org/cathen/09580c.htm) wishes to buy a thing for more than its worth. Therefore no man (https://www.newadvent.org/cathen/09580c.htm) should sell a thing to another man (https://www.newadvent.org/cathen/09580c.htm) for more than its worth.
I answer that, It is altogether sinful (https://www.newadvent.org/cathen/14004b.htm) to have recourse to deceit in order to sell a thing for more than its just price, because this is to deceive one's neighbor so as to injure him. Hence Tully says (De Offic. iii, 15): "Contracts should be entirely free from double-dealing: the seller must not impose upon the bidder, nor the buyer upon one that bids against him."
But, apart from fraud (https://www.newadvent.org/cathen/06249a.htm), we may speak of buying and selling in two ways. First, as considered in themselves, and from this point of view, buying and selling seem to be established for the common advantage of both parties, one of whom requires that which belongs to the other, and vice versa, as the Philosopher (https://www.newadvent.org/cathen/01713a.htm) states (Polit. i, 3). Now whatever is established for the common advantage, should not be more of a burden to one party than to another, and consequently all contracts between them should observe equality of thing and thing. Again, the quality (https://www.newadvent.org/cathen/12589c.htm) of a thing that comes into human (https://www.newadvent.org/cathen/09580c.htm) use is measured by the price given for it, for which purpose money was invented, as stated in Ethic. v, 5. Therefore if either the price exceed the quantity (https://www.newadvent.org/cathen/12591a.htm) of the thing's worth, or, conversely, the thing exceed the price, there is no longer the equality of justice (https://www.newadvent.org/cathen/08571c.htm): and consequently, to sell a thing for more than its worth, or to buy it for less than its worth, is in itself unjust (https://www.newadvent.org/cathen/08010c.htm) and unlawful.
Secondly we may speak of buying and selling, considered as accidentally (https://www.newadvent.org/cathen/01096c.htm) tending to the advantage of one party, and to the disadvantage of the other: for instance, when a man has great need of a certain thing, while an other man (https://www.newadvent.org/cathen/09580c.htm) will suffer if he be without it. On such a case the just price will depend not only on the thing sold, but on the loss which the sale brings on the seller. And thus it will be lawful to sell a thing for more than it is worth in itself, though the price paid be not more than it is worth to the owner. Yet if the one man (https://www.newadvent.org/cathen/09580c.htm) derive a great advantage by becoming possessed of the other man's (https://www.newadvent.org/cathen/09580c.htm) property, and the seller be not at a loss through being without that thing, the latter ought not to raise the price, because the advantage accruing to the buyer, is not due to the seller, but to a circuмstance affecting the buyer. Now no man (https://www.newadvent.org/cathen/09580c.htm) should sell what is not his, though he may charge for the loss he suffers.
On the other hand if a man find that he derives great advantage from something he has bought, he may, of his own accord, pay the seller something over and above: and this pertains to his honesty.
Reply to Objection 1. As stated above (I-II:96:2 (https://www.newadvent.org/summa/2096.htm#article2)) human (https://www.newadvent.org/cathen/09580c.htm) law (https://www.newadvent.org/cathen/09053a.htm) is given to the people among whom there are many lacking virtue (https://www.newadvent.org/cathen/15472a.htm), and it is not given to the virtuous (https://www.newadvent.org/cathen/15472a.htm) alone. Hence human (https://www.newadvent.org/cathen/09580c.htm) law (https://www.newadvent.org/cathen/09053a.htm) was unable to forbid all that is contrary to virtue (https://www.newadvent.org/cathen/15472a.htm); and it suffices for it to prohibit whatever is destructive of human (https://www.newadvent.org/cathen/09580c.htm) intercourse, while it treats other matters as though they were lawful, not by approving of them, but by not punishing them. Accordingly, if without employing deceit the seller disposes of his goods for more than their worth, or the buyer obtain them for less than their worth, the law (https://www.newadvent.org/cathen/09053a.htm) looks upon this as licit, and provides no punishment for so doing, unless the excess be too great, because then even human (https://www.newadvent.org/cathen/09580c.htm) law (https://www.newadvent.org/cathen/09053a.htm) demands restitution to be made, for instance if a man be deceived in regard to more than half the amount of the just price of a thing [Cod. IV, xliv, De Rescind. Vend. 2,8.
On the other hand the Divine law (https://www.newadvent.org/cathen/09071a.htm) leaves nothing unpunished that is contrary to virtue (https://www.newadvent.org/cathen/15472a.htm). Hence, according to the Divine law (https://www.newadvent.org/cathen/09071a.htm), it is reckoned unlawful if the equality of justice (https://www.newadvent.org/cathen/08571c.htm) be not observed in buying and selling: and he who has received more than he ought must make compensation to him that has suffered loss, if the loss be considerable. I add this condition (https://www.newadvent.org/cathen/04211a.htm), because the just price of things is not fixed with mathematical precision, but depends on a kind of estimate, so that a slight addition or subtraction would not seem to destroy the equality of justice (https://www.newadvent.org/cathen/08571c.htm).
Reply to Objection 2. As Augustine (https://www.newadvent.org/cathen/02084a.htm) says "this jester, either by looking into himself or by his experience of others, thought that all men (https://www.newadvent.org/cathen/09580c.htm) are inclined to wish to buy for a song and sell at a premium. But since in reality this is wicked (https://www.newadvent.org/cathen/05649a.htm), it is in every man's (https://www.newadvent.org/cathen/09580c.htm) power to acquire that justice (https://www.newadvent.org/cathen/08571c.htm) whereby he may resist and overcome this inclination." And then he gives the example of a man who gave the just price for a book to a man who through ignorance (https://www.newadvent.org/cathen/07648a.htm) asked a low price for it. Hence it is evident that this common desire is not from nature (https://www.newadvent.org/cathen/10715a.htm) but from vice (https://www.newadvent.org/cathen/15403c.htm), wherefore it is common to many who walk along the broad road of sin (https://www.newadvent.org/cathen/14004b.htm).
Reply to Objection 3. In commutative justice (https://www.newadvent.org/cathen/08571c.htm) we consider chiefly real equality. On the other hand, in friendship based on utility we consider equality of usefulness, so that the recompense should depend on the usefulness accruing, whereas in buying it should be equal to the thing bought.
Article 2. Whether a sale is rendered unlawful through a fault in the thing sold?
Objection 1. It would seem that a sale is not rendered unjust (https://www.newadvent.org/cathen/08010c.htm) and unlawful through a fault in the thing sold. For less account should be taken of the other parts of a thing than of what belongs to its substance (https://www.newadvent.org/cathen/14322c.htm). Yet the sale of a thing does not seem to be rendered unlawful through a fault in its substance (https://www.newadvent.org/cathen/14322c.htm): for instance, if a man sell instead of the real metal, silver or gold produced by some chemical process, which is adapted to all the human (https://www.newadvent.org/cathen/09580c.htm) uses for which silver and gold are necessary (https://www.newadvent.org/cathen/10733a.htm), for instance in the making of vessels and the like. Much less therefore will it be an unlawful sale if the thing be defective in other ways.
Objection 2. Further, any fault in the thing, affecting the quantity (https://www.newadvent.org/cathen/12591a.htm), would seem chiefly to be opposed to justice (https://www.newadvent.org/cathen/08571c.htm) which consists in equality. Now quantity (https://www.newadvent.org/cathen/12591a.htm) is known (https://www.newadvent.org/cathen/08673a.htm) by being measured: and the measures of things that come into human (https://www.newadvent.org/cathen/09580c.htm) use are not fixed, but in some places are greater, in others less, as the Philosopher (https://www.newadvent.org/cathen/01713a.htm) states (Ethic. v, 7). Therefore just as it is impossible to avoid defects on the part of the thing sold, it seems that a sale is not rendered unlawful through the thing sold being defective.
Objection 3. Further, the thing sold is rendered defective by lacking a fitting quality (https://www.newadvent.org/cathen/12589c.htm). But in order to know (https://www.newadvent.org/cathen/08673a.htm) the quality (https://www.newadvent.org/cathen/12589c.htm) of a thing, much knowledge (https://www.newadvent.org/cathen/08673a.htm) is required that is lacking in most buyers. Therefore a sale is not rendered unlawful by a fault (in the thing sold).
On the contrary, Ambrose (https://www.newadvent.org/cathen/01383c.htm) says (De Offic. iii, 11): "It is manifestly a rule of justice (https://www.newadvent.org/cathen/08571c.htm) that a good (https://www.newadvent.org/cathen/06636b.htm) man (https://www.newadvent.org/cathen/09580c.htm) should not depart from the truth (https://www.newadvent.org/cathen/15073a.htm), nor inflict an unjust (https://www.newadvent.org/cathen/08010c.htm) injury on anyone, nor have any connection with fraud (https://www.newadvent.org/cathen/06249a.htm)."
I answer that, A threefold fault may be found pertaining to the thing which is sold. One, in respect of the thing's substance (https://www.newadvent.org/cathen/14322c.htm): and if the seller be aware of a fault in the thing he is selling, he is guilty of a fraudulent sale, so that the sale is rendered unlawful. Hence we find it written against certain people (Isaiah 1:22 (https://www.newadvent.org/bible/isa001.htm#verse22)), "Thy silver is turned into dross, thy wine is mingled with water": because that which is mixed is defective in its substance (https://www.newadvent.org/cathen/14322c.htm).
Another defect is in respect of quantity (https://www.newadvent.org/cathen/12591a.htm) which is known (https://www.newadvent.org/cathen/08673a.htm) by being measured: wherefore if anyone knowingly make use of a faulty measure in selling, he is guilty of fraud (https://www.newadvent.org/cathen/06249a.htm), and the sale is illicit. Hence it is written (Deuteronomy 25:13-14 (https://www.newadvent.org/bible/deu025.htm#verse13)): "Thou shalt not have divers weights in thy bag, a greater and a less: neither shall there be in thy house a greater bushel and a less," and further on (Deuteronomy 25:16 (https://www.newadvent.org/bible/deu025.htm#verse16)): "For the Lord . . . abhorreth him that doth these things, and He hateth all injustice (https://www.newadvent.org/cathen/08010c.htm)."
A third defect is on the part of the quality (https://www.newadvent.org/cathen/12589c.htm), for instance, if a man sell an unhealthy animal as being a healthy one: and if anyone do this knowingly he is guilty of a fraudulent sale, and the sale, in consequence, is illicit.
In all these cases not only is the man (https://www.newadvent.org/cathen/09580c.htm) guilty of a fraudulent sale, but he is also bound to restitution. But if any of the foregoing defects be in the thing sold, and he knows (https://www.newadvent.org/cathen/08673a.htm) nothing about this, the seller does not sin (https://www.newadvent.org/cathen/14004b.htm), because he does that which is unjust (https://www.newadvent.org/cathen/08010c.htm) materially, nor is his deed (https://www.newadvent.org/cathen/01115a.htm) unjust (https://www.newadvent.org/cathen/08010c.htm), as shown above (II-II:59:2 (https://www.newadvent.org/summa/3059.htm#article2)). Nevertheless he is bound to compensate the buyer, when the defect comes to his knowledge (https://www.newadvent.org/cathen/08673a.htm). Moreover what has been said of the seller applies equally to the buyer. For sometimes it happens that the seller thinks his goods to be specifically of lower value, as when a man sells gold instead of copper, and then if the buyer be aware of this, he buys it unjustly (https://www.newadvent.org/cathen/08010c.htm) and is bound to restitution: and the same applies to a defect in quantity (https://www.newadvent.org/cathen/12591a.htm) as to a defect in quality (https://www.newadvent.org/cathen/12589c.htm).
Reply to Objection 1. Gold and silver are costly not only on account of the usefulness of the vessels and other like things made from them, but also on account of the excellence and purity of their substance (https://www.newadvent.org/cathen/14322c.htm). Hence if the gold or silver produced by alchemists has not the true (https://www.newadvent.org/cathen/15073a.htm) specific nature (https://www.newadvent.org/cathen/10715a.htm) of gold and silver, the sale thereof is fraudulent and unjust (https://www.newadvent.org/cathen/08010c.htm), especially as real gold and silver can produce certain results by their natural (https://www.newadvent.org/cathen/10715a.htm) action, which the counterfeit gold and silver of alchemists cannot produce. Thus the true (https://www.newadvent.org/cathen/15073a.htm) metal has the property of making people joyful (https://www.newadvent.org/cathen/07131b.htm), and is helpful medicinally against certain maladies. Moreover real gold can be employed more frequently, and lasts longer in its condition (https://www.newadvent.org/cathen/04211a.htm) of purity than counterfeit gold. If however real gold were to be produced by alchemy, it would not be unlawful to sell it for the genuine article, for nothing prevents art from employing certain natural (https://www.newadvent.org/cathen/10715a.htm) causes (https://www.newadvent.org/cathen/03459a.htm) for the production of natural (https://www.newadvent.org/cathen/10715a.htm) and true (https://www.newadvent.org/cathen/15073a.htm) effects, as Augustine (https://www.newadvent.org/cathen/02084a.htm) says (De Trin. iii, 8) of things produced by the art of the demons (https://www.newadvent.org/cathen/04710a.htm).
Reply to Objection 2. The measures of salable commodities must needs be different in different places, on account of the difference of supply: because where there is greater abundance, the measures are wont to be larger. However in each place those who govern the state must determine the just measures of things salable, with due consideration for the conditions (https://www.newadvent.org/cathen/04211a.htm) of place and time. Hence it is not lawful to disregard such measures as are established by public authority or custom.
Reply to Objection 3. As Augustine (https://www.newadvent.org/cathen/02084a.htm) says (De Civ. Dei xi, 16) the price of things salable does not depend on their degree of nature (https://www.newadvent.org/cathen/10715a.htm), since at times a horse fetches a higher price than a slave (https://www.newadvent.org/cathen/14036a.htm); but it depends on their usefulness to man (https://www.newadvent.org/cathen/09580c.htm). Hence it is not necessary (https://www.newadvent.org/cathen/10733a.htm) for the seller or buyer to be cognizant of the hidden qualities (https://www.newadvent.org/cathen/12589c.htm) of the thing sold, but only of such as render the thing adapted to man's (https://www.newadvent.org/cathen/09580c.htm) use, for instance, that the horse be strong, run well and so forth. Such qualities (https://www.newadvent.org/cathen/12589c.htm) the seller and buyer can easily discover.
Article 3. Whether the seller is bound to state the defects of the thing sold?
Objection 1. It would seem that the seller is not bound to state the defects of the thing sold. Since the seller does not bind the buyer to buy, he would seem to leave it to him to judge of the goods offered for sale. Now judgment about a thing and knowledge (https://www.newadvent.org/cathen/08673a.htm) of that thing belong to the same person (https://www.newadvent.org/cathen/11726a.htm). Therefore it does not seem imputable to the seller if the buyer be deceived in his judgment, and be hurried into buying a thing without carefully inquiring into its condition (https://www.newadvent.org/cathen/04211a.htm).
Objection 2. Further, it seems foolish for anyone to do what prevents him carrying out his work. But if a man states the defects of the goods he has for sale, he prevents their sale: wherefore Tully (De Offic. iii, 13) pictures a man as saying: "Could anything be more absurd than for a public crier, instructed by the owner, to cry: 'I offer this unhealthy horse for sale?'" Therefore the seller is not bound to state the defects of the thing sold.
Objection 3. Further, man (https://www.newadvent.org/cathen/09580c.htm) needs more to know (https://www.newadvent.org/cathen/08673a.htm) the road of virtue (https://www.newadvent.org/cathen/15472a.htm) than to know (https://www.newadvent.org/cathen/08673a.htm) the faults of things offered for sale. Now one is not bound to offer advice to all or to tell them the truth (https://www.newadvent.org/cathen/15073a.htm) about matters pertaining to virtue (https://www.newadvent.org/cathen/15472a.htm), though one should not tell anyone what is false (https://www.newadvent.org/cathen/05781a.htm). Much less therefore is a seller bound to tell the faults of what he offers for sale, as though he were counseling the buyer.
Objection 4. Further, if one were bound to tell the faults of what one offers for sale, this would only be in order to lower the price. Now sometimes the price would be lowered for some other reason, without any defect in the thing sold: for instance, if the seller carry wheat to a place where wheat fetches a high price, knowing (https://www.newadvent.org/cathen/08673a.htm) that many will come after him carrying wheat; because if the buyers knew (https://www.newadvent.org/cathen/08673a.htm) this they would give a lower price. But apparently the seller need not give the buyer this information. Therefore, in like manner, neither need he tell him the faults of the goods he is selling.
On the contrary, Ambrose (https://www.newadvent.org/cathen/01383c.htm) says (De Offic. iii, 10): "In all contracts the defects of the salable commodity must be stated; and unless the seller make them known (https://www.newadvent.org/cathen/08673a.htm), although the buyer has already acquired a right to them, the contract is voided on account of the fraudulent action."
I answer that, It is always unlawful to give anyone an occasion of danger or loss, although a man need not always give another the help or counsel which would be for his advantage in any way; but only in certain fixed cases, for instance when someone is subject to him, or when he is the only one who can assist him. Now the seller who offers goods for sale, gives the buyer an occasion of loss or danger, by the very fact that he offers him defective goods, if such defect may occasion loss or danger to the buyer—loss, if, by reason of this defect, the goods are of less value, and he takes nothing off the price on that account—danger, if this defect either hinder the use of the goods or render it hurtful, for instance, if a man sells a lame for a fleet horse, a tottering house for a safe one, rotten or poisonous food for wholesome. Wherefore if such like defects be hidden, and the seller does not make them known (https://www.newadvent.org/cathen/08673a.htm), the sale will be illicit and fraudulent, and the seller will be bound to compensation for the loss incurred.
On the other hand, if the defect be manifest, for instance if a horse have but one eye, or if the goods though useless to the buyer, be useful to someone else, provided the seller take as much as he ought from the price, he is not bound to state the defect of the goods, since perhaps on account of that defect the buyer might want him to allow a greater rebate than he need. Wherefore the seller may look to his own indemnity, by withholding the defect of the goods.
Reply to Objection 1. Judgment cannot be pronounced save on what is manifest: for "a man judges of what he knows (https://www.newadvent.org/cathen/08673a.htm)" (Ethic. i, 3). Hence if the defects of the goods offered for sale be hidden, judgment of them is not sufficiently left with the buyer unless such defects be made known (https://www.newadvent.org/cathen/08673a.htm) to him. The case would be different if the defects were manifest.
Reply to Objection 2. There is no need to publish beforehand by the public crier the defects of the goods one is offering for sale, because if he were to begin by announcing its defects, the bidders would be frightened to buy, through ignorance (https://www.newadvent.org/cathen/07648a.htm) of other qualities (https://www.newadvent.org/cathen/12589c.htm) that might render the thing good (https://www.newadvent.org/cathen/06636b.htm) and serviceable. Such defect ought to be stated to each individual (https://www.newadvent.org/cathen/07762a.htm) that offers to buy: and then he will be able to compare the various points one with the other, the good (https://www.newadvent.org/cathen/06636b.htm) with the bad: for nothing prevents that which is defective in one respect being useful in many others.
Reply to Objection 3. Although a man is not bound strictly speaking to tell everyone the truth (https://www.newadvent.org/cathen/15073a.htm) about matters pertaining to virtue (https://www.newadvent.org/cathen/15472a.htm), yet he is so bound in a case when, unless he tells the truth (https://www.newadvent.org/cathen/15073a.htm), his conduct would endanger another man (https://www.newadvent.org/cathen/09580c.htm) in detriment to virtue (https://www.newadvent.org/cathen/15472a.htm): and so it is in this case.
Reply to Objection 4. The defect in a thing makes it of less value now than it seems to be: but in the case cited, the goods are expected to be of less value at a future time, on account of the arrival of other merchants, which was not foreseen by the buyers. Wherefore the seller, since he sells his goods at the price actually offered him, does not seem to act contrary to justice (https://www.newadvent.org/cathen/08571c.htm) through not stating what is going to happen. If however he were to do so, or if he lowered his price, it would be exceedingly virtuous (https://www.newadvent.org/cathen/15472a.htm) on his part: although he does not seem to be bound to do this as a debt of justice (https://www.newadvent.org/cathen/08571c.htm).
Article 4. Whether, in trading, it is lawful to sell a thing at a higher price than what was paid for it?
Objection 1. It would seem that it is not lawful, in trading, to sell a thing for a higher price than we paid for it. For Chrysostom (https://www.newadvent.org/cathen/08452b.htm) [Hom. xxxviii in the Opus Imperfectum, falsely (https://www.newadvent.org/cathen/05781a.htm) ascribed to St. John Chrysostom (https://www.newadvent.org/cathen/08452b.htm)] says on Matthew 21:12 (https://www.newadvent.org/bible/mat021.htm#verse12): "He that buys a thing in order that he may sell it, entire and unchanged, at a profit, is the trader who is cast out of God's (https://www.newadvent.org/cathen/06608a.htm) temple." Cassiodorus (https://www.newadvent.org/cathen/03405c.htm) speaks in the same sense in his commentary on Psalm 70:15 (https://www.newadvent.org/bible/psa070.htm#verse15), "Because I have not known (https://www.newadvent.org/cathen/08673a.htm) learning, or trading" according to another version [the Septuagint (https://www.newadvent.org/cathen/13722a.htm)]: "What is trade," says he, "but buying at a cheap price with the purpose of retailing at a higher price?" and he adds: "Such were the tradesmen whom Our Lord (https://www.newadvent.org/cathen/08374c.htm) cast out of the temple." Now no man (https://www.newadvent.org/cathen/09580c.htm) is cast out of the temple except for a sin (https://www.newadvent.org/cathen/14004b.htm). Therefore such like trading is sinful (https://www.newadvent.org/cathen/14004b.htm).
Objection 2. Further, it is contrary to justice (https://www.newadvent.org/cathen/08571c.htm) to sell goods at a higher price than their worth, or to buy them for less than their value, as shown above (Article 1 (https://www.newadvent.org/summa/3077.htm#article1)). Now if you sell a thing for a higher price than you paid for it, you must either have bought it for less than its value, or sell it for more than its value. Therefore this cannot be done without sin (https://www.newadvent.org/cathen/14004b.htm).
Objection 3. Further, Jerome (https://www.newadvent.org/cathen/08341a.htm) says (Ep. ad Nepot. lii): "Shun, as you would the plague, a cleric (https://www.newadvent.org/cathen/04049b.htm) who from being poor has become wealthy, or who, from being a nobody has become a celebrity." Now trading would net seem to be forbidden to clerics (https://www.newadvent.org/cathen/04049b.htm) except on account of its sinfulness. Therefore it is a sin (https://www.newadvent.org/cathen/14004b.htm) in trading, to buy at a low price and to sell at a higher price.
On the contrary, Augustine (https://www.newadvent.org/cathen/02084a.htm) commenting on Psalm 70:15 (https://www.newadvent.org/bible/psa070.htm#verse15), "Because I have not known (https://www.newadvent.org/cathen/08673a.htm) learning," [Cf. Objection 1 says: "The greedy tradesman blasphemes over his losses; he lies and perjures himself over the price of his wares. But these are vices (https://www.newadvent.org/cathen/15403c.htm) of the man (https://www.newadvent.org/cathen/09580c.htm), not of the craft, which can be exercised without these vices (https://www.newadvent.org/cathen/15403c.htm)." Therefore trading is not in itself unlawful.
I answer that, A tradesman is one whose business consists in the exchange of things. According to the Philosopher (https://www.newadvent.org/cathen/01713a.htm) (Polit. i, 3), exchange of things is twofold; one, natural (https://www.newadvent.org/cathen/10715a.htm) as it were, and necessary (https://www.newadvent.org/cathen/10733a.htm), whereby one commodity is exchanged for another, or money taken in exchange for a commodity, in order to satisfy the needs of life. Such like trading, properly speaking, does not belong to tradesmen, but rather to housekeepers or civil servants who have to provide the household or the state with the necessaries of life. The other kind of exchange is either that of money for money, or of any commodity for money, not on account of the necessities of life, but for profit, and this kind of exchange, properly speaking, regards tradesmen, according to the Philosopher (https://www.newadvent.org/cathen/01713a.htm) (Polit. i, 3). The former kind of exchange is commendable because it supplies a natural (https://www.newadvent.org/cathen/10715a.htm) need: but the latter is justly (https://www.newadvent.org/cathen/08571c.htm) deserving of blame, because, considered in itself, it satisfies the greed for gain, which knows (https://www.newadvent.org/cathen/08673a.htm) no limit and tends to infinity (https://www.newadvent.org/cathen/08004a.htm). Hence trading, considered in itself, has a certain debasement attaching thereto, in so far as, by its very nature (https://www.newadvent.org/cathen/10715a.htm), it does not imply a virtuous (https://www.newadvent.org/cathen/15472a.htm) or necessary (https://www.newadvent.org/cathen/10733a.htm) end. Nevertheless gain which is the end of trading, though not implying, by its nature (https://www.newadvent.org/cathen/10715a.htm), anything virtuous (https://www.newadvent.org/cathen/15472a.htm) or necessary (https://www.newadvent.org/cathen/10733a.htm), does not, in itself, connote anything sinful (https://www.newadvent.org/cathen/14004b.htm) or contrary to virtue (https://www.newadvent.org/cathen/15472a.htm): wherefore nothing prevents gain from being directed to some necessary (https://www.newadvent.org/cathen/10733a.htm) or even virtuous (https://www.newadvent.org/cathen/15472a.htm) end, and thus trading becomes lawful. Thus, for instance, a man may intend the moderate gain which he seeks to acquire by trading for the upkeep of his household, or for the assistance of the needy: or again, a man may take to trade for some public advantage, for instance, lest his country lack the necessaries of life, and seek gain, not as an end, but as payment for his labor.
Reply to Objection 1. The saying of Chrysostom (https://www.newadvent.org/cathen/08452b.htm) refers to the trading which seeks gain as a last end. This is especially the case where a man sells something at a higher price without its undergoing any change. For if he sells at a higher price something that has changed for the better, he would seem to receive the reward of his labor. Nevertheless the gain itself may be lawfully intended, not as a last end, but for the sake of some other end which is necessary (https://www.newadvent.org/cathen/10733a.htm) or virtuous (https://www.newadvent.org/cathen/15472a.htm), as stated above.
Reply to Objection 2. Not everyone that sells at a higher price than he bought is a tradesman, but only he who buys that he may sell at a profit. If, on the contrary, he buys not for sale but for possession, and afterwards, for some reason wishes to sell, it is not a trade transaction even if he sell at a profit. For he may lawfully do this, either because he has bettered the thing, or because the value of the thing has changed with the change of place or time, or on account of the danger he incurs in transferring the thing from one place to another, or again in having it carried by another. On this sense neither buying nor selling is unjust (https://www.newadvent.org/cathen/08010c.htm).
Reply to Objection 3. Clerics should abstain not only from things that are evil (https://www.newadvent.org/cathen/05649a.htm) in themselves, but even from those that have an appearance of evil (https://www.newadvent.org/cathen/05649a.htm). This happens in trading, both because it is directed to worldly gain, which clerics (https://www.newadvent.org/cathen/04049b.htm) should despise, and because trading is open to so many vices (https://www.newadvent.org/cathen/15403c.htm), since "a merchant is hardly free from sins (https://www.newadvent.org/cathen/14004b.htm) of the lips" ['A merchant is hardly free from negligence, and a huckster shall not be justified from the sins (https://www.newadvent.org/cathen/14004b.htm) of the lips'] (Sirach 26:28 (https://www.newadvent.org/bible/sir026.htm#verse28)). There is also another reason, because trading engages the mind (https://www.newadvent.org/cathen/10321a.htm) too much with worldly cares, and consequently withdraws it from spiritual (https://www.newadvent.org/cathen/14220b.htm) cares; wherefore the Apostle (https://www.newadvent.org/cathen/11567b.htm) says (2 Timothy 2:4 (https://www.newadvent.org/bible/2ti002.htm#verse4)): "No man (https://www.newadvent.org/cathen/09580c.htm) being a soldier to God (https://www.newadvent.org/cathen/06608a.htm) entangleth himself with secular businesses." Nevertheless it is lawful for clerics (https://www.newadvent.org/cathen/04049b.htm) to engage in the first mentioned kind of exchange, which is directed to supply the necessaries of life, either by buying or by selling.
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For used items, whatever someone will pay for them is just.
For new items, generally whatever the market will bear, I think.
I disagree. People can be induced into paying much more than something is worth out of necessity or desperation. It happens all the time. This is known colloquially as price gouging. People take advantage of situations to extract much more out of buyers than things are worth in and of themselves. Recently we had examples of people buying up toilet paper and then selling it on eBay for 10x what it was really worth. There were people out there who were buying up nearly all the new video game consoles (XBox Series X and PS 5) so that ordinary people couldn't get them, and then they were marking them up by 50-100% and re-selling them on eBay. St. Thomas would condemn these practices as gravely immoral, akin to theft. That's what the Jєωs do too. So, for instance, when we pay $5 at the gas pump, a significant amount of that is siphoned off by the various Jєωιѕн outfits (like Goldman Sachs) that trade in commodities and stocks. And yet from the ground to the gas tank, at no point along the way did any of these trading firms contribute anything to the production of the product.
So the real worth of an item is proportionate to both the cost of materials required to produce it and the amount of labor (or expense, in the case of automation) to produce it. I believe St. Thomas would hold that a certain amount of "profit" -- related to the time, effort, and expense of the person who started and/or runs the business -- would be justified. But I suspect that he would object to the obscenely large profits that are often made that far exceed what would be fair compensation to the business owner. If someone, say, would work full time running the business, making $200 million for a year's worth of work, that would be considered way out of proportion. There would of course be other considerations, such as taking some of the additional money to use for the development of new products, putting aside some savings in case things got slow to make sure they could still pay their employees, etc.
But the notion of charging in excessive of inherent value entails the same principles whereby St. Thomas also condemns usury. He would consider excess profit to be akin to usury.
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Thanks, Mark. So the answer about what is a fair "profit" is addressed here:
Secondly we may speak of buying and selling, considered as accidentally tending to the advantage of one party, and to the disadvantage of the other: for instance, when a man has great need of a certain thing, while an other man will suffer if he be without it. On such a case the just price will depend not only on the thing sold, but on the loss which the sale brings on the seller. And thus it will be lawful to sell a thing for more than it is worth in itself, though the price paid be not more than it is worth to the owner. Yet if the one man derive a great advantage by becoming possessed of the other man's property, and the seller be not at a loss through being without that thing, the latter ought not to raise the price, because the advantage accruing to the buyer, is not due to the seller, but to a circuмstance affecting the buyer. Now no man should sell what is not his, though he may charge for the loss he suffers.
So, basically, as I highlighted in bold, a seller is entitled to be compensated for any loss he incurs (including the investment of his time, money, etc.) in transacting the sale, and that is the scenario in which an item maybe sold "for more than it is worth IN ITSELF". Then, what I highlighted in italics is where he rejects price gouging, where it is unjust to raise the price because the buyer has a great need for the product that is not proportionate to the loss incurred by the seller but due to circuмstances affecting the buyer.
Let's look at a micro-economic example. I have plenty of toilet paper but my neighbor runs out. He comes to me asking for it. So, I am entitled to charge him for it what I paid. Also, if now as a result of selling the toilet paper I'll have to make a special run to the store to get some more, I incur the loss of the additional time it would take for me to make the extra trip, for the wear and tear on my car, etc. So it's OK in that case to charge a little more to compensate me for the extra effort and expense on my part. If, however, I have plenty left so that I can wait for my next regularly-scheduled shopping trip, then I incur no loss from the transaction and have no justification for charging more than what I paid for it. But then, hah, I see that the prospective buyer is desperate for toilet paper. I know that if I charge him 3x or even 10x what it's worth, he'll pay it because he's desperate. That is sinful.
So this capitalistic notion of being able to charge as much as you can get away with due to market conditions is in violation of the principles laid down by St. Thomas. It must be proportionate only to the loss incurred by the seller, and not due to circuмstances affecting the buyer.
Extending this out to larger enterprises, the amount of "profit" should be proportionate to the investment made by the seller to develop the product, investment in time and money. So, if I put in 80 hours a week running a company that produces the product, I am entitled to a reasonable compensation for my work. I'm also entitled to recover any money I invested in the product. And the cost of the product includes not only the raw materials but the labor involved in making it. There's also the stress of running a company and the risk incurred, where if I do not succeed I can lose some money on it. It's hard to put a monetary amount on such things, but I can see half a million dollars to about a million dollars per year to be reasonable compensation for all that. But this garbage where a company CEO make $250 million per year, that is gravely immoral. Also, 90% of the time, with big business, there's no personal risk involved that needs to be compensated for. Companies are formed, and these companies take out loans for their investments. If things don't pan out, they declare bankruptcy, and just wipe some electronic numbers from a database, but no individual is incurring a personal financial risk regarding the investment.
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So, in general, the only justification for charging more than something is worth "IN ITSELF" (i.e. the cost of materials and labor required to produce it, transport it, etc.) is loss incurred by the seller. Circuмstances affecting the buyer do not justify charging in excess of the item's worth.
So, for instance, I come up with a product or invention that enables people to cut in half the amount of time they would ordinarily require to do a certain task. It costs me $100 to produce this product (including any just profit as defined above). I know that with this product, I can save the buyer 100 hours of work each year. So I figure that's worth about $1000. Consequently, I figure I can sell this product for $500 (instead of the $100 it costs me to make it and take a legitimate profit). St. Thomas also rejects this objection (3 above), where it's argued that the price can be based on the "advantage accruing to the buyer" from acquiring the item.
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I disagree. People can be induced into paying much more than something is worth out of necessity or desperation. It happens all the time. This is known colloquially as price gouging. People take advantage of situations to extract much more out of buyers than things are worth in and of themselves. Recently we had examples of people buying up toilet paper and then selling it on eBay for 10x what it was really worth. There were people out there who were buying up nearly all the new video game consoles (XBox Series X and PS 5) so that ordinary people couldn't get them, and then they were marking them up by 50-100% and re-selling them on eBay. St. Thomas would condemn these practices as gravely immoral, akin to theft. That's what the Jєωs do too. So, for instance, when we pay $5 at the gas pump, a significant amount of that is siphoned off by the various Jєωιѕн outfits (like Goldman Sachs) that trade in commodities and stocks. And yet from the ground to the gas tank, at no point along the way did any of these trading firms contribute anything to the production of the product.
So the real worth of an item is proportionate to both the cost of materials required to produce it and the amount of labor (or expense, in the case of automation) to produce it. I believe St. Thomas would hold that a certain amount of "profit" -- related to the time, effort, and expense of the person who started and/or runs the business -- would be justified. But I suspect that he would object to the obscenely large profits that are often made that far exceed what would be fair compensation to the business owner. If someone, say, would work full time running the business, making $200 million for a year's worth of work, that would be considered way out of proportion. There would of course be other considerations, such as taking some of the additional money to use for the development of new products, putting aside some savings in case things got slow to make sure they could still pay their employees, etc.
But the notion of charging in excessive of inherent value entails the same principles whereby St. Thomas also condemns usury. He would consider excess profit to be akin to usury.
True. For example, during a natural disaster, people will take advantage of the situation by jacking up prices on goods such as water, food, and gas. It happens all the time in Florida when a hurricane approaches.
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So this capitalistic notion of being able to charge as much as you can get away with due to market conditions is in violation of the principles laid down by St. Thomas. …
The "Catholic" Libertarian dirtbags will turn contortions to justify their "free market" price gouging.
They have adopted the ѕуηαgσgυє of Satan "science" religion of economics, including "lost investment," "time value of money," etc. to justify usury, unjust prices, and unjust wages.
In that regard the whatever-the-market-will-bear "Catholics" turn my stomach even more than the damn Jєωs.
I'd like to compliment Cryptinox who, for as long as I have known him here, has done his best to defeat Jєωιѕн usury and looting—all the more remarkable in such a young man.
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Question 77. Cheating, which is committed in buying and selling
- Unjust sales as regards the price: namely, is it lawful to sell a thing for more than its worth? (https://www.newadvent.org/summa/3077.htm#article1)
- Unjust sales on the part of the thing sold (https://www.newadvent.org/summa/3077.htm#article2)
- Is the seller bound to reveal a fault in the thing sold? (https://www.newadvent.org/summa/3077.htm#article3)
- Is it lawful in trading to sell a thing at a higher price than was paid for it? (https://www.newadvent.org/summa/3077.htm#article4)
Article 1. Whether it is lawful to sell a thing for more than its worth?
Objection 1. It would seem that it is lawful to sell a thing for more than its worth. On the commutations of human (https://www.newadvent.org/cathen/09580c.htm) life, civil laws determine that which is just. Now according to these laws it is just for buyer and seller to deceive one another (Cod. IV, xliv, De Rescind. Vend. 8,15): and this occurs by the seller selling a thing for more than its worth, and the buyer buying a thing for less than its worth. Therefore it is lawful to sell a thing for more than its worth.
Objection 2. Further, that which is common to all would seem to be natural (https://www.newadvent.org/cathen/10715a.htm) and not sinful (https://www.newadvent.org/cathen/14004b.htm). Now Augustine (https://www.newadvent.org/cathen/02084a.htm) relates that the saying of a certain jester was accepted by all, "You wish to buy for a song and to sell at a premium," which agrees with the saying of Proverbs 20:14 (https://www.newadvent.org/bible/pro020.htm#verse14), "It is naught, it is naught, saith every buyer: and when he is gone away, then he will boast." Therefore it is lawful to sell a thing for more than its worth.
Objection 3. Further, it does not seem unlawful if that which honesty demands be done by mutual agreement. Now, according to the Philosopher (https://www.newadvent.org/cathen/01713a.htm) (Ethic. viii, 13), in the friendship which is based on utility, the amount of the recompense for a favor received should depend on the utility accruing to the receiver: and this utility sometimes is worth more than the thing given, for instance if the receiver be in great need of that thing, whether for the purpose of avoiding a danger, or of deriving some particular benefit. Therefore, in contracts of buying and selling, it is lawful to give a thing in return for more than its worth.
On the contrary, It is written (Matthew 7:12 (https://www.newadvent.org/bible/mat007.htm#verse12)): "All things . . . whatsoever you would that men should do to you, do you also to them." But no man (https://www.newadvent.org/cathen/09580c.htm) wishes to buy a thing for more than its worth. Therefore no man (https://www.newadvent.org/cathen/09580c.htm) should sell a thing to another man (https://www.newadvent.org/cathen/09580c.htm) for more than its worth.
I answer that, It is altogether sinful (https://www.newadvent.org/cathen/14004b.htm) to have recourse to deceit in order to sell a thing for more than its just price, because this is to deceive one's neighbor so as to injure him. Hence Tully says (De Offic. iii, 15): "Contracts should be entirely free from double-dealing: the seller must not impose upon the bidder, nor the buyer upon one that bids against him."
But, apart from fraud (https://www.newadvent.org/cathen/06249a.htm), we may speak of buying and selling in two ways. First, as considered in themselves, and from this point of view, buying and selling seem to be established for the common advantage of both parties, one of whom requires that which belongs to the other, and vice versa, as the Philosopher (https://www.newadvent.org/cathen/01713a.htm) states (Polit. i, 3). Now whatever is established for the common advantage, should not be more of a burden to one party than to another, and consequently all contracts between them should observe equality of thing and thing. Again, the quality (https://www.newadvent.org/cathen/12589c.htm) of a thing that comes into human (https://www.newadvent.org/cathen/09580c.htm) use is measured by the price given for it, for which purpose money was invented, as stated in Ethic. v, 5. Therefore if either the price exceed the quantity (https://www.newadvent.org/cathen/12591a.htm) of the thing's worth, or, conversely, the thing exceed the price, there is no longer the equality of justice (https://www.newadvent.org/cathen/08571c.htm): and consequently, to sell a thing for more than its worth, or to buy it for less than its worth, is in itself unjust (https://www.newadvent.org/cathen/08010c.htm) and unlawful.
Secondly we may speak of buying and selling, considered as accidentally (https://www.newadvent.org/cathen/01096c.htm) tending to the advantage of one party, and to the disadvantage of the other: for instance, when a man has great need of a certain thing, while an other man (https://www.newadvent.org/cathen/09580c.htm) will suffer if he be without it. On such a case the just price will depend not only on the thing sold, but on the loss which the sale brings on the seller. And thus it will be lawful to sell a thing for more than it is worth in itself, though the price paid be not more than it is worth to the owner. Yet if the one man (https://www.newadvent.org/cathen/09580c.htm) derive a great advantage by becoming possessed of the other man's (https://www.newadvent.org/cathen/09580c.htm) property, and the seller be not at a loss through being without that thing, the latter ought not to raise the price, because the advantage accruing to the buyer, is not due to the seller, but to a circuмstance affecting the buyer. Now no man (https://www.newadvent.org/cathen/09580c.htm) should sell what is not his, though he may charge for the loss he suffers.
On the other hand if a man find that he derives great advantage from something he has bought, he may, of his own accord, pay the seller something over and above: and this pertains to his honesty.
Reply to Objection 1. As stated above (I-II:96:2 (https://www.newadvent.org/summa/2096.htm#article2)) human (https://www.newadvent.org/cathen/09580c.htm) law (https://www.newadvent.org/cathen/09053a.htm) is given to the people among whom there are many lacking virtue (https://www.newadvent.org/cathen/15472a.htm), and it is not given to the virtuous (https://www.newadvent.org/cathen/15472a.htm) alone. Hence human (https://www.newadvent.org/cathen/09580c.htm) law (https://www.newadvent.org/cathen/09053a.htm) was unable to forbid all that is contrary to virtue (https://www.newadvent.org/cathen/15472a.htm); and it suffices for it to prohibit whatever is destructive of human (https://www.newadvent.org/cathen/09580c.htm) intercourse, while it treats other matters as though they were lawful, not by approving of them, but by not punishing them. Accordingly, if without employing deceit the seller disposes of his goods for more than their worth, or the buyer obtain them for less than their worth, the law (https://www.newadvent.org/cathen/09053a.htm) looks upon this as licit, and provides no punishment for so doing, unless the excess be too great, because then even human (https://www.newadvent.org/cathen/09580c.htm) law (https://www.newadvent.org/cathen/09053a.htm) demands restitution to be made, for instance if a man be deceived in regard to more than half the amount of the just price of a thing [Cod. IV, xliv, De Rescind. Vend. 2,8.
On the other hand the Divine law (https://www.newadvent.org/cathen/09071a.htm) leaves nothing unpunished that is contrary to virtue (https://www.newadvent.org/cathen/15472a.htm). Hence, according to the Divine law (https://www.newadvent.org/cathen/09071a.htm), it is reckoned unlawful if the equality of justice (https://www.newadvent.org/cathen/08571c.htm) be not observed in buying and selling: and he who has received more than he ought must make compensation to him that has suffered loss, if the loss be considerable. I add this condition (https://www.newadvent.org/cathen/04211a.htm), because the just price of things is not fixed with mathematical precision, but depends on a kind of estimate, so that a slight addition or subtraction would not seem to destroy the equality of justice (https://www.newadvent.org/cathen/08571c.htm).
Reply to Objection 2. As Augustine (https://www.newadvent.org/cathen/02084a.htm) says "this jester, either by looking into himself or by his experience of others, thought that all men (https://www.newadvent.org/cathen/09580c.htm) are inclined to wish to buy for a song and sell at a premium. But since in reality this is wicked (https://www.newadvent.org/cathen/05649a.htm), it is in every man's (https://www.newadvent.org/cathen/09580c.htm) power to acquire that justice (https://www.newadvent.org/cathen/08571c.htm) whereby he may resist and overcome this inclination." And then he gives the example of a man who gave the just price for a book to a man who through ignorance (https://www.newadvent.org/cathen/07648a.htm) asked a low price for it. Hence it is evident that this common desire is not from nature (https://www.newadvent.org/cathen/10715a.htm) but from vice (https://www.newadvent.org/cathen/15403c.htm), wherefore it is common to many who walk along the broad road of sin (https://www.newadvent.org/cathen/14004b.htm).
Reply to Objection 3. In commutative justice (https://www.newadvent.org/cathen/08571c.htm) we consider chiefly real equality. On the other hand, in friendship based on utility we consider equality of usefulness, so that the recompense should depend on the usefulness accruing, whereas in buying it should be equal to the thing bought.
Article 2. Whether a sale is rendered unlawful through a fault in the thing sold?
Objection 1. It would seem that a sale is not rendered unjust (https://www.newadvent.org/cathen/08010c.htm) and unlawful through a fault in the thing sold. For less account should be taken of the other parts of a thing than of what belongs to its substance (https://www.newadvent.org/cathen/14322c.htm). Yet the sale of a thing does not seem to be rendered unlawful through a fault in its substance (https://www.newadvent.org/cathen/14322c.htm): for instance, if a man sell instead of the real metal, silver or gold produced by some chemical process, which is adapted to all the human (https://www.newadvent.org/cathen/09580c.htm) uses for which silver and gold are necessary (https://www.newadvent.org/cathen/10733a.htm), for instance in the making of vessels and the like. Much less therefore will it be an unlawful sale if the thing be defective in other ways.
Objection 2. Further, any fault in the thing, affecting the quantity (https://www.newadvent.org/cathen/12591a.htm), would seem chiefly to be opposed to justice (https://www.newadvent.org/cathen/08571c.htm) which consists in equality. Now quantity (https://www.newadvent.org/cathen/12591a.htm) is known (https://www.newadvent.org/cathen/08673a.htm) by being measured: and the measures of things that come into human (https://www.newadvent.org/cathen/09580c.htm) use are not fixed, but in some places are greater, in others less, as the Philosopher (https://www.newadvent.org/cathen/01713a.htm) states (Ethic. v, 7). Therefore just as it is impossible to avoid defects on the part of the thing sold, it seems that a sale is not rendered unlawful through the thing sold being defective.
Objection 3. Further, the thing sold is rendered defective by lacking a fitting quality (https://www.newadvent.org/cathen/12589c.htm). But in order to know (https://www.newadvent.org/cathen/08673a.htm) the quality (https://www.newadvent.org/cathen/12589c.htm) of a thing, much knowledge (https://www.newadvent.org/cathen/08673a.htm) is required that is lacking in most buyers. Therefore a sale is not rendered unlawful by a fault (in the thing sold).
On the contrary, Ambrose (https://www.newadvent.org/cathen/01383c.htm) says (De Offic. iii, 11): "It is manifestly a rule of justice (https://www.newadvent.org/cathen/08571c.htm) that a good (https://www.newadvent.org/cathen/06636b.htm) man (https://www.newadvent.org/cathen/09580c.htm) should not depart from the truth (https://www.newadvent.org/cathen/15073a.htm), nor inflict an unjust (https://www.newadvent.org/cathen/08010c.htm) injury on anyone, nor have any connection with fraud (https://www.newadvent.org/cathen/06249a.htm)."
I answer that, A threefold fault may be found pertaining to the thing which is sold. One, in respect of the thing's substance (https://www.newadvent.org/cathen/14322c.htm): and if the seller be aware of a fault in the thing he is selling, he is guilty of a fraudulent sale, so that the sale is rendered unlawful. Hence we find it written against certain people (Isaiah 1:22 (https://www.newadvent.org/bible/isa001.htm#verse22)), "Thy silver is turned into dross, thy wine is mingled with water": because that which is mixed is defective in its substance (https://www.newadvent.org/cathen/14322c.htm).
Another defect is in respect of quantity (https://www.newadvent.org/cathen/12591a.htm) which is known (https://www.newadvent.org/cathen/08673a.htm) by being measured: wherefore if anyone knowingly make use of a faulty measure in selling, he is guilty of fraud (https://www.newadvent.org/cathen/06249a.htm), and the sale is illicit. Hence it is written (Deuteronomy 25:13-14 (https://www.newadvent.org/bible/deu025.htm#verse13)): "Thou shalt not have divers weights in thy bag, a greater and a less: neither shall there be in thy house a greater bushel and a less," and further on (Deuteronomy 25:16 (https://www.newadvent.org/bible/deu025.htm#verse16)): "For the Lord . . . abhorreth him that doth these things, and He hateth all injustice (https://www.newadvent.org/cathen/08010c.htm)."
A third defect is on the part of the quality (https://www.newadvent.org/cathen/12589c.htm), for instance, if a man sell an unhealthy animal as being a healthy one: and if anyone do this knowingly he is guilty of a fraudulent sale, and the sale, in consequence, is illicit.
In all these cases not only is the man (https://www.newadvent.org/cathen/09580c.htm) guilty of a fraudulent sale, but he is also bound to restitution. But if any of the foregoing defects be in the thing sold, and he knows (https://www.newadvent.org/cathen/08673a.htm) nothing about this, the seller does not sin (https://www.newadvent.org/cathen/14004b.htm), because he does that which is unjust (https://www.newadvent.org/cathen/08010c.htm) materially, nor is his deed (https://www.newadvent.org/cathen/01115a.htm) unjust (https://www.newadvent.org/cathen/08010c.htm), as shown above (II-II:59:2 (https://www.newadvent.org/summa/3059.htm#article2)). Nevertheless he is bound to compensate the buyer, when the defect comes to his knowledge (https://www.newadvent.org/cathen/08673a.htm). Moreover what has been said of the seller applies equally to the buyer. For sometimes it happens that the seller thinks his goods to be specifically of lower value, as when a man sells gold instead of copper, and then if the buyer be aware of this, he buys it unjustly (https://www.newadvent.org/cathen/08010c.htm) and is bound to restitution: and the same applies to a defect in quantity (https://www.newadvent.org/cathen/12591a.htm) as to a defect in quality (https://www.newadvent.org/cathen/12589c.htm).
Reply to Objection 1. Gold and silver are costly not only on account of the usefulness of the vessels and other like things made from them, but also on account of the excellence and purity of their substance (https://www.newadvent.org/cathen/14322c.htm). Hence if the gold or silver produced by alchemists has not the true (https://www.newadvent.org/cathen/15073a.htm) specific nature (https://www.newadvent.org/cathen/10715a.htm) of gold and silver, the sale thereof is fraudulent and unjust (https://www.newadvent.org/cathen/08010c.htm), especially as real gold and silver can produce certain results by their natural (https://www.newadvent.org/cathen/10715a.htm) action, which the counterfeit gold and silver of alchemists cannot produce. Thus the true (https://www.newadvent.org/cathen/15073a.htm) metal has the property of making people joyful (https://www.newadvent.org/cathen/07131b.htm), and is helpful medicinally against certain maladies. Moreover real gold can be employed more frequently, and lasts longer in its condition (https://www.newadvent.org/cathen/04211a.htm) of purity than counterfeit gold. If however real gold were to be produced by alchemy, it would not be unlawful to sell it for the genuine article, for nothing prevents art from employing certain natural (https://www.newadvent.org/cathen/10715a.htm) causes (https://www.newadvent.org/cathen/03459a.htm) for the production of natural (https://www.newadvent.org/cathen/10715a.htm) and true (https://www.newadvent.org/cathen/15073a.htm) effects, as Augustine (https://www.newadvent.org/cathen/02084a.htm) says (De Trin. iii, 8) of things produced by the art of the demons (https://www.newadvent.org/cathen/04710a.htm).
Reply to Objection 2. The measures of salable commodities must needs be different in different places, on account of the difference of supply: because where there is greater abundance, the measures are wont to be larger. However in each place those who govern the state must determine the just measures of things salable, with due consideration for the conditions (https://www.newadvent.org/cathen/04211a.htm) of place and time. Hence it is not lawful to disregard such measures as are established by public authority or custom.
Reply to Objection 3. As Augustine (https://www.newadvent.org/cathen/02084a.htm) says (De Civ. Dei xi, 16) the price of things salable does not depend on their degree of nature (https://www.newadvent.org/cathen/10715a.htm), since at times a horse fetches a higher price than a slave (https://www.newadvent.org/cathen/14036a.htm); but it depends on their usefulness to man (https://www.newadvent.org/cathen/09580c.htm). Hence it is not necessary (https://www.newadvent.org/cathen/10733a.htm) for the seller or buyer to be cognizant of the hidden qualities (https://www.newadvent.org/cathen/12589c.htm) of the thing sold, but only of such as render the thing adapted to man's (https://www.newadvent.org/cathen/09580c.htm) use, for instance, that the horse be strong, run well and so forth. Such qualities (https://www.newadvent.org/cathen/12589c.htm) the seller and buyer can easily discover.
Article 3. Whether the seller is bound to state the defects of the thing sold?
Objection 1. It would seem that the seller is not bound to state the defects of the thing sold. Since the seller does not bind the buyer to buy, he would seem to leave it to him to judge of the goods offered for sale. Now judgment about a thing and knowledge (https://www.newadvent.org/cathen/08673a.htm) of that thing belong to the same person (https://www.newadvent.org/cathen/11726a.htm). Therefore it does not seem imputable to the seller if the buyer be deceived in his judgment, and be hurried into buying a thing without carefully inquiring into its condition (https://www.newadvent.org/cathen/04211a.htm).
Objection 2. Further, it seems foolish for anyone to do what prevents him carrying out his work. But if a man states the defects of the goods he has for sale, he prevents their sale: wherefore Tully (De Offic. iii, 13) pictures a man as saying: "Could anything be more absurd than for a public crier, instructed by the owner, to cry: 'I offer this unhealthy horse for sale?'" Therefore the seller is not bound to state the defects of the thing sold.
Objection 3. Further, man (https://www.newadvent.org/cathen/09580c.htm) needs more to know (https://www.newadvent.org/cathen/08673a.htm) the road of virtue (https://www.newadvent.org/cathen/15472a.htm) than to know (https://www.newadvent.org/cathen/08673a.htm) the faults of things offered for sale. Now one is not bound to offer advice to all or to tell them the truth (https://www.newadvent.org/cathen/15073a.htm) about matters pertaining to virtue (https://www.newadvent.org/cathen/15472a.htm), though one should not tell anyone what is false (https://www.newadvent.org/cathen/05781a.htm). Much less therefore is a seller bound to tell the faults of what he offers for sale, as though he were counseling the buyer.
Objection 4. Further, if one were bound to tell the faults of what one offers for sale, this would only be in order to lower the price. Now sometimes the price would be lowered for some other reason, without any defect in the thing sold: for instance, if the seller carry wheat to a place where wheat fetches a high price, knowing (https://www.newadvent.org/cathen/08673a.htm) that many will come after him carrying wheat; because if the buyers knew (https://www.newadvent.org/cathen/08673a.htm) this they would give a lower price. But apparently the seller need not give the buyer this information. Therefore, in like manner, neither need he tell him the faults of the goods he is selling.
On the contrary, Ambrose (https://www.newadvent.org/cathen/01383c.htm) says (De Offic. iii, 10): "In all contracts the defects of the salable commodity must be stated; and unless the seller make them known (https://www.newadvent.org/cathen/08673a.htm), although the buyer has already acquired a right to them, the contract is voided on account of the fraudulent action."
I answer that, It is always unlawful to give anyone an occasion of danger or loss, although a man need not always give another the help or counsel which would be for his advantage in any way; but only in certain fixed cases, for instance when someone is subject to him, or when he is the only one who can assist him. Now the seller who offers goods for sale, gives the buyer an occasion of loss or danger, by the very fact that he offers him defective goods, if such defect may occasion loss or danger to the buyer—loss, if, by reason of this defect, the goods are of less value, and he takes nothing off the price on that account—danger, if this defect either hinder the use of the goods or render it hurtful, for instance, if a man sells a lame for a fleet horse, a tottering house for a safe one, rotten or poisonous food for wholesome. Wherefore if such like defects be hidden, and the seller does not make them known (https://www.newadvent.org/cathen/08673a.htm), the sale will be illicit and fraudulent, and the seller will be bound to compensation for the loss incurred.
On the other hand, if the defect be manifest, for instance if a horse have but one eye, or if the goods though useless to the buyer, be useful to someone else, provided the seller take as much as he ought from the price, he is not bound to state the defect of the goods, since perhaps on account of that defect the buyer might want him to allow a greater rebate than he need. Wherefore the seller may look to his own indemnity, by withholding the defect of the goods.
Reply to Objection 1. Judgment cannot be pronounced save on what is manifest: for "a man judges of what he knows (https://www.newadvent.org/cathen/08673a.htm)" (Ethic. i, 3). Hence if the defects of the goods offered for sale be hidden, judgment of them is not sufficiently left with the buyer unless such defects be made known (https://www.newadvent.org/cathen/08673a.htm) to him. The case would be different if the defects were manifest.
Reply to Objection 2. There is no need to publish beforehand by the public crier the defects of the goods one is offering for sale, because if he were to begin by announcing its defects, the bidders would be frightened to buy, through ignorance (https://www.newadvent.org/cathen/07648a.htm) of other qualities (https://www.newadvent.org/cathen/12589c.htm) that might render the thing good (https://www.newadvent.org/cathen/06636b.htm) and serviceable. Such defect ought to be stated to each individual (https://www.newadvent.org/cathen/07762a.htm) that offers to buy: and then he will be able to compare the various points one with the other, the good (https://www.newadvent.org/cathen/06636b.htm) with the bad: for nothing prevents that which is defective in one respect being useful in many others.
Reply to Objection 3. Although a man is not bound strictly speaking to tell everyone the truth (https://www.newadvent.org/cathen/15073a.htm) about matters pertaining to virtue (https://www.newadvent.org/cathen/15472a.htm), yet he is so bound in a case when, unless he tells the truth (https://www.newadvent.org/cathen/15073a.htm), his conduct would endanger another man (https://www.newadvent.org/cathen/09580c.htm) in detriment to virtue (https://www.newadvent.org/cathen/15472a.htm): and so it is in this case.
Reply to Objection 4. The defect in a thing makes it of less value now than it seems to be: but in the case cited, the goods are expected to be of less value at a future time, on account of the arrival of other merchants, which was not foreseen by the buyers. Wherefore the seller, since he sells his goods at the price actually offered him, does not seem to act contrary to justice (https://www.newadvent.org/cathen/08571c.htm) through not stating what is going to happen. If however he were to do so, or if he lowered his price, it would be exceedingly virtuous (https://www.newadvent.org/cathen/15472a.htm) on his part: although he does not seem to be bound to do this as a debt of justice (https://www.newadvent.org/cathen/08571c.htm).
Article 4. Whether, in trading, it is lawful to sell a thing at a higher price than what was paid for it?
Objection 1. It would seem that it is not lawful, in trading, to sell a thing for a higher price than we paid for it. For Chrysostom (https://www.newadvent.org/cathen/08452b.htm) [Hom. xxxviii in the Opus Imperfectum, falsely (https://www.newadvent.org/cathen/05781a.htm) ascribed to St. John Chrysostom (https://www.newadvent.org/cathen/08452b.htm)] says on Matthew 21:12 (https://www.newadvent.org/bible/mat021.htm#verse12): "He that buys a thing in order that he may sell it, entire and unchanged, at a profit, is the trader who is cast out of God's (https://www.newadvent.org/cathen/06608a.htm) temple." Cassiodorus (https://www.newadvent.org/cathen/03405c.htm) speaks in the same sense in his commentary on Psalm 70:15 (https://www.newadvent.org/bible/psa070.htm#verse15), "Because I have not known (https://www.newadvent.org/cathen/08673a.htm) learning, or trading" according to another version [the Septuagint (https://www.newadvent.org/cathen/13722a.htm)]: "What is trade," says he, "but buying at a cheap price with the purpose of retailing at a higher price?" and he adds: "Such were the tradesmen whom Our Lord (https://www.newadvent.org/cathen/08374c.htm) cast out of the temple." Now no man (https://www.newadvent.org/cathen/09580c.htm) is cast out of the temple except for a sin (https://www.newadvent.org/cathen/14004b.htm). Therefore such like trading is sinful (https://www.newadvent.org/cathen/14004b.htm).
Objection 2. Further, it is contrary to justice (https://www.newadvent.org/cathen/08571c.htm) to sell goods at a higher price than their worth, or to buy them for less than their value, as shown above (Article 1 (https://www.newadvent.org/summa/3077.htm#article1)). Now if you sell a thing for a higher price than you paid for it, you must either have bought it for less than its value, or sell it for more than its value. Therefore this cannot be done without sin (https://www.newadvent.org/cathen/14004b.htm).
Objection 3. Further, Jerome (https://www.newadvent.org/cathen/08341a.htm) says (Ep. ad Nepot. lii): "Shun, as you would the plague, a cleric (https://www.newadvent.org/cathen/04049b.htm) who from being poor has become wealthy, or who, from being a nobody has become a celebrity." Now trading would net seem to be forbidden to clerics (https://www.newadvent.org/cathen/04049b.htm) except on account of its sinfulness. Therefore it is a sin (https://www.newadvent.org/cathen/14004b.htm) in trading, to buy at a low price and to sell at a higher price.
On the contrary, Augustine (https://www.newadvent.org/cathen/02084a.htm) commenting on Psalm 70:15 (https://www.newadvent.org/bible/psa070.htm#verse15), "Because I have not known (https://www.newadvent.org/cathen/08673a.htm) learning," [Cf. Objection 1 says: "The greedy tradesman blasphemes over his losses; he lies and perjures himself over the price of his wares. But these are vices (https://www.newadvent.org/cathen/15403c.htm) of the man (https://www.newadvent.org/cathen/09580c.htm), not of the craft, which can be exercised without these vices (https://www.newadvent.org/cathen/15403c.htm)." Therefore trading is not in itself unlawful.
I answer that, A tradesman is one whose business consists in the exchange of things. According to the Philosopher (https://www.newadvent.org/cathen/01713a.htm) (Polit. i, 3), exchange of things is twofold; one, natural (https://www.newadvent.org/cathen/10715a.htm) as it were, and necessary (https://www.newadvent.org/cathen/10733a.htm), whereby one commodity is exchanged for another, or money taken in exchange for a commodity, in order to satisfy the needs of life. Such like trading, properly speaking, does not belong to tradesmen, but rather to housekeepers or civil servants who have to provide the household or the state with the necessaries of life. The other kind of exchange is either that of money for money, or of any commodity for money, not on account of the necessities of life, but for profit, and this kind of exchange, properly speaking, regards tradesmen, according to the Philosopher (https://www.newadvent.org/cathen/01713a.htm) (Polit. i, 3). The former kind of exchange is commendable because it supplies a natural (https://www.newadvent.org/cathen/10715a.htm) need: but the latter is justly (https://www.newadvent.org/cathen/08571c.htm) deserving of blame, because, considered in itself, it satisfies the greed for gain, which knows (https://www.newadvent.org/cathen/08673a.htm) no limit and tends to infinity (https://www.newadvent.org/cathen/08004a.htm). Hence trading, considered in itself, has a certain debasement attaching thereto, in so far as, by its very nature (https://www.newadvent.org/cathen/10715a.htm), it does not imply a virtuous (https://www.newadvent.org/cathen/15472a.htm) or necessary (https://www.newadvent.org/cathen/10733a.htm) end. Nevertheless gain which is the end of trading, though not implying, by its nature (https://www.newadvent.org/cathen/10715a.htm), anything virtuous (https://www.newadvent.org/cathen/15472a.htm) or necessary (https://www.newadvent.org/cathen/10733a.htm), does not, in itself, connote anything sinful (https://www.newadvent.org/cathen/14004b.htm) or contrary to virtue (https://www.newadvent.org/cathen/15472a.htm): wherefore nothing prevents gain from being directed to some necessary (https://www.newadvent.org/cathen/10733a.htm) or even virtuous (https://www.newadvent.org/cathen/15472a.htm) end, and thus trading becomes lawful. Thus, for instance, a man may intend the moderate gain which he seeks to acquire by trading for the upkeep of his household, or for the assistance of the needy: or again, a man may take to trade for some public advantage, for instance, lest his country lack the necessaries of life, and seek gain, not as an end, but as payment for his labor.
Reply to Objection 1. The saying of Chrysostom (https://www.newadvent.org/cathen/08452b.htm) refers to the trading which seeks gain as a last end. This is especially the case where a man sells something at a higher price without its undergoing any change. For if he sells at a higher price something that has changed for the better, he would seem to receive the reward of his labor. Nevertheless the gain itself may be lawfully intended, not as a last end, but for the sake of some other end which is necessary (https://www.newadvent.org/cathen/10733a.htm) or virtuous (https://www.newadvent.org/cathen/15472a.htm), as stated above.
Reply to Objection 2. Not everyone that sells at a higher price than he bought is a tradesman, but only he who buys that he may sell at a profit. If, on the contrary, he buys not for sale but for possession, and afterwards, for some reason wishes to sell, it is not a trade transaction even if he sell at a profit. For he may lawfully do this, either because he has bettered the thing, or because the value of the thing has changed with the change of place or time, or on account of the danger he incurs in transferring the thing from one place to another, or again in having it carried by another. On this sense neither buying nor selling is unjust (https://www.newadvent.org/cathen/08010c.htm).
Reply to Objection 3. Clerics should abstain not only from things that are evil (https://www.newadvent.org/cathen/05649a.htm) in themselves, but even from those that have an appearance of evil (https://www.newadvent.org/cathen/05649a.htm). This happens in trading, both because it is directed to worldly gain, which clerics (https://www.newadvent.org/cathen/04049b.htm) should despise, and because trading is open to so many vices (https://www.newadvent.org/cathen/15403c.htm), since "a merchant is hardly free from sins (https://www.newadvent.org/cathen/14004b.htm) of the lips" ['A merchant is hardly free from negligence, and a huckster shall not be justified from the sins (https://www.newadvent.org/cathen/14004b.htm) of the lips'] (Sirach 26:28 (https://www.newadvent.org/bible/sir026.htm#verse28)). There is also another reason, because trading engages the mind (https://www.newadvent.org/cathen/10321a.htm) too much with worldly cares, and consequently withdraws it from spiritual (https://www.newadvent.org/cathen/14220b.htm) cares; wherefore the Apostle (https://www.newadvent.org/cathen/11567b.htm) says (2 Timothy 2:4 (https://www.newadvent.org/bible/2ti002.htm#verse4)): "No man (https://www.newadvent.org/cathen/09580c.htm) being a soldier to God (https://www.newadvent.org/cathen/06608a.htm) entangleth himself with secular businesses." Nevertheless it is lawful for clerics (https://www.newadvent.org/cathen/04049b.htm) to engage in the first mentioned kind of exchange, which is directed to supply the necessaries of life, either by buying or by selling.
Thank you for helping to educate me.
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Would these pricing issues be applicable only to "necessary" goods and services? Obviously, what is necessary can still be subjective, but I'm wondering if it would one could morally charge virtually any price for a good or service that is purely unnecessary? I'm thinking of, say, a pool (possibly) or a movie DVD.
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Companies are also reducing the volume, net weight or quantity while keeping the price the same as to trick the buyer into thinking they're not paying more.
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Companies are also reducing the volume, net weight or quantity while keeping the price the same as to trick the buyer into thinking they're not paying more.
I have been shocked to see cereal packages weighing 3.5 ounces for almost $6 (hence about $27/lb.) at Whole Foods.
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The "Catholic" Libertarian dirtbags will turn contortions to justify their "free market" price gouging.
They have adopted the ѕуηαgσgυє of Satan "science" religion of economics, including "lost investment," "time value of money," etc. to justify usury, unjust prices, and unjust wages.
In that regard the whatever-the-market-will-bear "Catholics" turn my stomach even more than the damn Jєωs.
I'd like to compliment Cryptinox who, for as long as I have known him here, has done his best to defeat Jєωιѕн usury and looting—all the more remarkable in such a young man.
I'm disappointed that the Church let up on the condemnation of usury (just quietly stopped enforcing it). Most "theologians" started spinning usury as "excessive" interest.
At least during the Middle Ages, your local Shylock at least incurred some risk in lending out his gold. Today, the Jєωs have taken it to a whole new level. They create money out of nothing, backed by the public, which holds the IOU to the note (so it's the public that incurs the risk, not the Jєωs), and then lend it back to the same people who back it with their IOU (the public) and charge interest on it. So they don't even own OWN the "money" they're lending at interest, and incur zero risk. Unfortunately, these incredibly week popes we've had since St. Pius X have refused to condemn this entire "federal reserve" system.
So they take "money" that's backed by an IOU from the American people and lend it to the American people and then charge interest to the American people for what's basically their own money ... and the sheer audacity of this is unbelievable, and yet we hear crickets from even the legitimate pre-V2 popes about the matter.
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Your summary nailed the (((problem))) perfectly, Lad.
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What I am wondering about is the price of stuff like antiques or used goods. I know you can pay a little less than the new cost due to how old the item is. However, I bought 3 icons from a garage sale for $5. One of them was hand painted in France in the 20th or 19th century if I had to guess. I am wondering if I should go back and give them more as it probably cost more than 5 bucks to produce that work of art to begin with. Another thing I was wondering is auctions. I'd assume paying low would be fine since the seller takes the risk upon his or herself. I remember reading Aquinas applied just price to just sellers and just buyers so it seems so as long as the two people are just and they agree on a price it could possibly be fine. There is a lot of nuance it seems. Another thing I'd consider is paying at least the cost something was to produce I'm a factory. I am currently looking for 80s instruments and this stuff crossed my mind.
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What I am wondering about is the price of stuff like antiques or used goods. I know you can pay a little less than the new cost due to how old the item is. However, I bought 3 icons from a garage sale for $5. One of them was hand painted in France in the 20th or 19th century if I had to guess. I am wondering if I should go back and give them more as it probably cost more than 5 bucks to produce that work of art to begin with. Another thing I was wondering is auctions. I'd assume paying low would be fine since the seller takes the risk upon his or herself. I remember reading Aquinas applied just price to just sellers and just buyers so it seems so as long as the two people are just and they agree on a price it could possibly be fine. There is a lot of nuance it seems. Another thing I'd consider is paying at least the cost something was to produce I'm a factory. I am currently looking for 80s instruments and this stuff crossed my mind.
Ah, don't let your scrupulosity get to you. Maybe it cost more than $5 to produce these icons in the first place, but maybe not (taking inflation into account). But for used stuff, you wouldn't be compensating the ORIGINAL producer of the item. Presumably the original producer of the item was paid what it's worth, and it's not your obligation to investigate the history of these icons all the way back to ensure that. Of course, they may have been stolen from their original producer too. But it's impossible to know, and you're under no obligation to find all that out.
I see a couple gaps in your reasoning:
1) Person who sold you the icons didn't produce them. So what he can rightfully get for them is based on what he paid for them plus whatever additional work he may have put into them, e.g. if he had restored them, whatever.
2) There's no principle that would stop a person from selling something for LESS than it's worth. If I want to, I can give something away for nothing, or sell a $500,000 house for $1. There's nothing immoral about that or about accepting it. What's immoral is only if the SELLER charges more for something than it's worth. This principle doesn't prevent a BUYER from paying more for something than it's worth. If some price gouger wanted to charge you $100 for a roll of toilet paper, you can certainly buy it without sin, as the sin would be on his end. And if he wanted to give it to you for free, there's nothing immoral there on either side.
In summary, if you can get a deal and get something for less than what it's worth, then there's no sin in buying it.
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One thing I haven't seen here, at least not explicitly, is the compensation for risk. If I buy 100 widgets, and nobody buys them from me, I'm stuck with 100 widgets in my warehouse that I've paid for. If I sell half of the widgets and then people quit buying widgets, then I'm stuck with half of them. When I bought the widgets, I basically gambled on being able to sell them all.
I don't see it as unjust to compensate myself for the risk I took when I bought the 100 widgets, and thus deprived myself of the money I spent on them, money I may get back, profit I may or may not make, or if people all of a sudden quit buying widgets, then I've lost all of my money and I have a warehouse full of widgets. If I can't eat them, repurpose them, or sell them as scrap or at a deep discount (maybe doing no more than cutting my losses), then they're useless to me, and I've lost all the money I spent on them.
Just ask Charles Tandy about the time he had to dig a trench and bury all those Activision games (or whatever they were). Literally couldn't give them away.
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Risk is inherent to doing any business.
Compensation for taking risk is "Jєωιѕн values," like their "lost opportunity" and "time value of money."
The farmer doesn't get paid for his rotten fruit, but the Jєω gets paid for his "short" commodity option and loan interest.
The Jєωs won't do the back-breaking work, but they will make sure they get paid for their "risk."
To hell with that.
(https://tinyurl.com/ye29nb2p)
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One thing I haven't seen here, at least not explicitly, is the compensation for risk.
This is true. I would expect that more risk = more time, more manpower, more costs to get finished, thus a higher price would be quantifiable and expected.
Example: Comparing the costs associated with the first hotel ever built on oceanfront property vs a hotel that was built a few blocks inland. I'm sure that the engineering costs for the oceanfront property were much higher, thus the increase in price is justified. The "intangible" price increase for a better view of the ocean is also just, imo, because that might be quantifiable in the higher interest rate (or higher collateral amount) that the builder had to incur in order to get a riskier loan from the bank. Basically, I don't see how any riskier business venture doesn't take more time/cost, so this would all factor in to the higher cost.
Simpler example: Let's say you were a chef and you wanted to experiment with making a new type of steak sauce. Let's say you spent a few hours a week, over the course of a year, to experiment with different spices, ingredients, etc. All of these experiments cost something - ingredients cost, note taking, giving out samples to friends/family for feedback, etc. Then, when you think you have a complete product, you have to take the risk of adding it to the steak (additional cost), hoping the customers like it. If it's a success, much of the cost is hard to quantify. If a normal steak sauce costs $4 a bottle, and your new sauce is very unique, I think you could charge a much higher fee, to recoup your costs (i.e. $8-10). If people pay that, then great; no one is forcing them to. Eventually, you'll have competition and the price will come down.
Catholic economics gets hairy when you try to compare necessary vs luxury items. Necessities of life have more rules to follow, morally, with an obligation for a lower amount, but they also have a lifetime of consumer demand, so your business would be low profit but high volume (i.e. a farmer or breadmaker).
Luxury items are inherently risky because demand can come and go, so higher prices are necessary for the worker to earn back his investment. High profit but low volume and possible short duration of sales (i.e. fashion clothes, products based on "popularity").
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Now according to these laws it is just for buyer and seller to deceive one another (Cod. IV, xliv, De Rescind. Vend. 8,15): and this occurs by the seller selling a thing for more than its worth, and the buyer buying a thing for less than its worth. Therefore it is lawful to sell a thing for more than its worth.
5. Therefore if either the price exceed the quantity (https://www.newadvent.org/cathen/12591a.htm) of the thing's worth, or, conversely, the thing exceed the price, there is no longer the equality of justice (https://www.newadvent.org/cathen/08571c.htm): and consequently, to sell a thing for more than its worth, or to buy it for less than its worth, is in itself unjust (https://www.newadvent.org/cathen/08010c.htm) and unlawful.
if a man find that he derives great advantage from something he has bought, he may, of his own accord, pay the seller something over and above: and this pertains to his honesty.
Accordingly, if without employing deceit the seller disposes of his goods for more than their worth, or the buyer obtain them for less than their worth, the law (https://www.newadvent.org/cathen/09053a.htm) looks upon this as licit, and provides no punishment for so doing, unless the excess be too great, because then even human (https://www.newadvent.org/cathen/09580c.htm) law (https://www.newadvent.org/cathen/09053a.htm) demands restitution to be made, for instance if a man be deceived in regard to more than half the amount of the just price of a thing [Cod. IV, xliv, De Rescind. Vend. 2,8.
On the other hand the Divine law (https://www.newadvent.org/cathen/09071a.htm) leaves nothing unpunished that is contrary to virtue (https://www.newadvent.org/cathen/15472a.htm). Hence, according to the Divine law (https://www.newadvent.org/cathen/09071a.htm), it is reckoned unlawful if the equality of justice (https://www.newadvent.org/cathen/08571c.htm) be not observed in buying and selling: and he who has received more than he ought must make compensation to him that has suffered loss, if the loss be considerable. I add this condition (https://www.newadvent.org/cathen/04211a.htm), because the just price of things is not fixed with mathematical precision, but depends on a kind of estimate, so that a slight addition or subtraction would not seem to destroy the equality of justice (https://www.newadvent.org/cathen/08571c.htm).
For sometimes it happens that the seller thinks his goods to be specifically of lower value, as when a man sells gold instead of copper, and then if the buyer be aware of this, he buys it unjustly (https://www.newadvent.org/cathen/08010c.htm) and is bound to restitution:
2) There's no principle that would stop a person from selling something for LESS than it's worth. If I want to, I can give something away for nothing, or sell a $500,000 house for $1. There's nothing immoral about that or about accepting it. What's immoral is only if the SELLER charges more for something than it's worth. This principle doesn't prevent a BUYER from paying more for something than it's worth. If some price gouger wanted to charge you $100 for a roll of toilet paper, you can certainly buy it without sin, as the sin would be on his end. And if he wanted to give it to you for free, there's nothing immoral there on either side.
In summary, if you can get a deal and get something for less than what it's worth, then there's no sin in buying it.
I routinely buy items for far less than they are worth on fb marketplace, garage sales, and the like.
It is a bit difficult to figure out what exactly the worth is on a used food processor, for example, but if I can purchase one that is worth $80 new for $5-10 used, should I pay the seller a bit more?
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This thread got me thinking of the reverse of price gouging. So, what does St. Thomas and the Church say when organizations slash wages when the demand goes down. In other words, wouldn’t it be just as immoral to take advantage of a recession to cut someone’s wages and have the organization take more of the profit?
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Yes. Unjust wages are as sinful as unjust prices.
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That's what I thought as well, and yet you have "conservatives" in this country who think it's perfectly all right to rob someone of just wages just because of supply and demand. I heard some Novus Ordo priest saying on EWTN; (I think his name is Robert Chirico), saying something to the effect that well supply, and demand would determine what a just wage is. Ugh, most of these big corporations will rob you blind the first chance they get.
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Chirico is the founder of the (((libertarian))) Acton Institute who also has performed fag "marriages." He is through-and-through a product of the ѕуηαgσgυє of Satan.
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Ah, the Acton Institute that name rings a bell. The problem is that Chirico and the rest of the Novus Oro teach this nonsense to unsuspecting Catholics, who later become business leaders and think it's morally acceptable to rob wages from workers.
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Wow, I did not know Chirico performed gαy marriages. EWTN has fallen deep into the sewer!
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Risk is inherent to doing any business.
Compensation for taking risk is "Jєωιѕн values," like their "lost opportunity" and "time value of money."
The farmer doesn't get paid for his rotten fruit, but the Jєω gets paid for his "short" commodity option and loan interest.
The Jєωs won't do the back-breaking work, but they will make sure they get paid for their "risk."
To hell with that.
(https://tinyurl.com/ye29nb2p)
I hear what you are saying, but let's strip this down to a very simple example.
The fruit farmer knows that, on average, his crop will fail one year out of ten. (Actually, "failure" is a relative term, some years will be better than others, some worse, but just to keep the math simple, I'll use this, assume normal crops nine years out of ten, and no crop at all in one of those ten years.) One year out of ten, he makes zero money. He still has to live and to support his family.
Is he not, then, entitled to charge 10% more for his fruit, than it would be worth, if all years were perfect and he could sell everything he grows? He would, then, in this idealized scenario, put that extra 10% aside each year, and have it to live on, during that year that he has no fruit to sell.
No injustice is done to anybody. He always has enough to live on, even in lean years. The "market price", if you will, includes that premium he is paid as a kind of "insurance" against bad years. Rather, the injustice would be done, if he could NOT charge that 10% premium, and had to starve during that one bad year out of ten --- the injustice would not be to his customers, but to him. And if he didn't have a fruit farm (assume there is only one fruit farm in existence, and it is his, yes, I know, that wouldn't be distributism, but just follow my simplified example to understand the idea), nobody would have any fruit at all.
I hope this makes some sense. It does to me.