There is no Law of Supply and Demand any more than there is a Law of Epicycles, or a Law of Action at a Distance. For that matter, even Newton's Laws of Gravitation are only an approximation, and fail under Relativistic circumstances.

Economics is NOT the study of a natural phenomenon, it is mostly a means of justifying certain ideological conclusions. The way we organize our commercial universe also must take into account the human element, consideration must be taken of social, historical, cultural and political phenomena. What about class struggle? This is why there are so many schools of economics, so many theories. Adam Smith made great contributions, but he did not figure it all out, there was economic activity long before the "The Wealth of Nations". And what about the Marxists? We refuse to study them at all in this country. Why, Because they challenge all those neat little fictions we employ, like the Law of Supply and Fucking Demand. The global economy is not two little kids with competing lemonade stands. Wise up, that model is strictly for little kids.

Should we all become Marxists? Certainly not, not any more than we should all go back to 18th century Mercantilism. Marx had many useful insights, but he had little knowledge on how to correct the many contradictions and inconsistencies of classical Capitalism. And Marx didn't have a clue about how to construct a fair and equitable economic system. History has show us that.

Marxism failed, for the same reasons Smith failed: Economics is a SOCIAL SCIENCE, not an analogue of physics or chemistry. There are no rules or laws. Economic justice and efficiency cannot be achieved by applying mathematical formulas and statistical processes, that's bookkeeping, not science. Justice and efficiency is achieved in the state houses and legislatures, at the ballot box and on the street, and by lots of people getting the crap beat out of them on picket lines. It can only be achieved through democratic political action. That's how America has always done it, by taking advantage of the natural checks and balances and motivations of the competitive free market, but regulating the businessmen whenever they get out of line, which is every chance they get. We need regulations, controls, labor unions, all the other apparatus required to keep the business majors from stealing our lab notebooks and sharing them with their frat bros.

That is the one True Law of Capitalism: Capitalists cannot be trusted. Their incentive is always to cheat, to frustrate the Market, to game the system, to hijack the machinery of the State to serve their purposes. Even Teddy Roosevelt understood that when he Busted the Trusts, and he was certainly no Lefty from California. And Its what America, and now, Western Europe, has always done. It is the source of our prosperity and our freedom.

If you start relying on Myths like The Law of Supply and Demand, what you wind up with is the Satanic Mills of Victorian Britain, the Irish potato famine, the slums and plutocrats of the Gilded Age, or the horrors now arising in China and Russia.

Wake up, Buck. Academic economics is not a study of how the system works, its a means of making sure it doesn't change.