Kansas families feel the squeeze. Prescription drugs are expensive. Credit card balances are heavy. Rents and groceries are up. When people are hurting, it’s understandable that lawmakers reach for a simple-sounding fix: cap the price.
But that’s where good intentions collide with bad economics. Milton Friedman’s warning applies perfectly here: don’t judge policy by its stated goal, judge it by its results. And Frédéric Bastiat’s “seen and unseen” is the cheat code every legislator should keep on their desk: the “seen” is the lower posted price; the “unseen” is the shortage, the quality drop, the access loss, and the costs pushed into other corners of the economy.
ECON 101: A cap doesn’t remove scarcity; it hides it.
Prices are signals. They tell producers what to make more of and tell consumers what’s scarce. When the government sets a price ceiling below what supply and demand would produce, sellers respond rationally: they supply less, invest less, or change the product to cut costs. The result is predictable: shortages, waiting, rationing, fewer choices, and lower quality. That’s not ideology. That’s how incentives work.
The political appeal is obvious: a cap looks like instant relief. But the “unseen” shows up later, and it hits real people.
“Upper payment limits” for drugs are price controls
In Kansas, one proposal (introduced in 2025 as SB 212) would create a prescription drug pricing board and allow the state to set “upper payment limits” for certain medications. That is a textbook price ceiling, just written in bureaucratic language.
Supporters likely mean well. But if you cap what can be paid, you change the incentives for manufacturers, wholesalers, pharmacies, and insurers. The “seen” is a headline claiming lower prices. The “unseen” is what follows: tighter formularies, fewer covered options, delayed availability, and supply pulled toward higher-paying areas.
Scarcity doesn’t vanish; it’s managed—usually through paperwork and gatekeeping.
Federal example: the 10% credit card rate cap idea
A federal proposal to cap credit card interest rates at 10% is being sold as consumer-friendly. But interest is the price of unsecured credit. Cap that price below the risk-based level, and lenders will protect themselves in the only ways they can: tighter approvals, lower credit limits, fewer rewards, more fees, and less access for people with thinner credit files. The “seen” is a lower APR for some borrowers who still qualify. The “unseen” is credit drying up for those who need it most.
This is the same pattern as any other price control: if you force the price down, you get less of the thing. In this case, that “thing” is credit availability.
Local example: Rent control is a cautionary tale
Rent control is one of the clearest “seen/unseen” examples in economics. The “seen” is a tenant paying below-market rent today. The “unseen” is fewer rentals over time, less maintenance, less new construction, and higher prices for everyone who isn’t lucky enough to get one of the controlled units. Kansas law wisely prohibits local governments from enacting rent controls or controlling real estate purchase prices.
Housing is the same story: prices fall when supply rises. Kansas should encourage local reforms like accessory dwelling units, smaller minimum lot sizes, and fewer parking mandates because fewer zoning restrictions actually reduces housing prices rather than subsidies or caps.
That same logic should guide the state and federal levels, too. If rent control is bad economics in Wichita or Kansas City, it doesn’t magically become good economics when moved to Topeka or Washington.
The consistent rule for lawmakers: avoid price caps everywhere
Whether the policy comes from a city council, the statehouse, or Congress, the economic mechanics are the same:
- Price caps reduce supply (less production, less investment, less entry).
- They shift costs into hidden fees, lower quality, rationing, or delays.
- They invite gaming and lobbying as industries fight over exemptions and loopholes.
- They punish innovation by lowering the payoff to creating something better.
That’s why Friedman’s point matters: you can have noble motives and still cause harm. Bastiat’s point matters because the harm is often delayed and invisible until families are stuck with fewer options.
What Kansas should do: free up supply and competition
If the goal is affordability, focus on reforms that expand supply and competition rather than trying to command prices:
- Remove barriers that limit entry and supply (especially in housing and healthcare delivery).
- Increase transparency that consumers can actually use to shop and switch.
- Reduce rules that entrench incumbents and block lower-cost competitors.
Price controls feel compassionate. But real compassion means choosing policies that work in the real world, not just in press releases. Kansas should keep its policy compass steady: don’t cap prices—free markets so supply, competition, and innovation can push prices down the right way.
