You are committing a fallacy fallacy fallacy. If an argument is fallacious, it definitely is wrong. The proposition supported by that argument might still be right however.
If an argument is fallacious, it definitely is wrong.
F^4: Not necessarily. For example, some would argue that an argument is not necessarily "wrong" if it is logically sound and produces a correct conclusion, even though it is fallacious because unbeknownst to the participants there is both a false premise and countervailing unknown factor. See Gettier Problems: http://www.iep.utm.edu/gettier/.
There cannot be an unknown factor which renders a valid argument in valid. An argument makes explicit all of the propositions on which it rests. The propositions themselves are irrelevant to validity: a valid argument is true for all possible combinations of truth values of the propositions. It is valid in any imaginable universe, so to speak. That is to say, we can take all of its distinct propositions, replace them with unique variable names, and then evaluate it for all combination of truth values of those variables, and it must come out true.
If an argument is valid, then we can further consider whether it is sound: are its propositions true when interpreted in some relevant world (often the real one, but possibly any imaginary world that the debaters agree about, e.g. the Star Trek universe or whatever). Being valid, the argument will of course be true, but if it is unsound for the given world, it will only somehow be vacuously true in that world. For instance, by exhibiting a false conclusion from a false premise in a conditional.
Applying this reasoning rigidly to the examples presented in http://www.iep.utm.edu/gettier/ readily unravels their issues. For instance, the lucky coincidence that Smith has ten coins in his pocket readily succumbs to the fact that this situation isn't true in all imaginable universes; it is a separate proposition from "Jones has ten coins in his pocket". It gets a separate variable, and is separately considered both false and true when we go through all the possible variable values.
Not quite right: just because an argument is fallacious doesn't mean that the propositions on which it is based are false. Not a single proposition need be false, only the logic.
In any case, the argument is not fallacious, at least as I read it; it’s just partially implicit. To spell it out:
Most people (not all) wouldn’t consider government distortion of markets as inherently morally bad, but bad because it can cause negative outcomes, i.e. sellers away/out of business, and ultimately leave consumers with worse or more expensive goods. And certainly that’s one possible outcome, depending on the policy and the market in question. But a lot of people leap directly from “government distortion of markets” to “disastrous results”, ignoring that in other cases, the results seem to be either positive or at least not all that bad, as evidenced by a well-functioning market existing despite government intervention. An example of this - with a greater likelihood of applicability due to being in a related market sector - is the agriculture market in the US and EU, with respect to the aforementioned subsidies.
https://rationalwiki.org/wiki/Fallacy_fallacy