Ignorant Twirps

The US Congress wants to make "price gouging" illegal. You see, the free market is free as long as it doesn't settle on a price that is "unreasonable" or "unconscionably excessive".

Simple prediction: many gas station owners will close down their places during emergencies. Why should they sell anything at a loss and risk fine / jail for "unreasonable" prices?

These politicians really don't get the basic supply and demand curves if they actually think that legislating in such manner will get them "reasonable" results.

Comments

[Saul Wall]

And of course the closing down in an emergency will result in violence and possibly deaths so not only is this policy brainless, it is potentially lethal. Plus, price controls on food and water in or before an emergency allow panic buying of essentials that will probably not be needed by those getting it and result in shortages when distribution lines are cut. Where would we be if we did not have public officials to do our thinking for us.

[Classical Liberal]

Unfortunately, most people don't believe in things like the law of supply and demand. They just know, emotionally, that if prices are at some level they don't like (too high if buying something, too low if selling) it is the result of some malicious conspiracy.

Isaac, may I ask what you studied in college?

[Isaac Schrödinger]

Economics and mathematics.

[Alex]

It depends on how you define "price gouging". If an emergency hit and a gas station had to increase iut's prices due to higher costs, nobody would consider that to be price gouging. On the other hand, selling water fr $10 a bottle during hurricane Katrina just because you happen to have a large supply and people are dying of thirst, that's a different matter entirely.

On the other hand, I also think this is a stupid idea. People should be able to control what they do with their property. An price gouging law would be unconstitutional.

[Classical Liberal]

"An price gouging law would be unconstitutional." Maybe. Unfortunately, the use of the commerce clause has been expanded so much that the concept of "interstate commerce" can be twisted to mean almost anything, while the 10th Amendment is regularly ignored by all branches of government. In one case before the Supreme Court the Clinton administration actually argued that the commerce clause gave the Federal government plenopotentiary power--unlimited power--wherever they wanted to use it. Happily, the Supremes didn't fall for that one.