Three Cheers For "Price Gougers"

TechCentralStation ^ | September 2, 205 | Rand Simberg

[staytrue]

Tell us: 1: Exactly how you would determine someone is "gouging"

Gouging is when the customer needs something that is critical to their health and when the supplier has a monopoly over a short time period. An example would be someone needs a ladder to escape from a burning building and you have the only ladder around. Gouging is if you ask 10,000 dollars to rent the ladder for a few minutes. Here you have a temporary monopoly and the customer needs it to survive.

[staytrue]

take a few courses in Economics, its very clear you have no idea what you are talking about.

Every economics book I ever read argues for regulation of monopolies.

Gouging can only occur when a monopoly exists. No one argues that monopolies should be allowed to operate unfettered.

[stylin_geek]

Wow, I consider myself to be a history buff, but it appears you are an economics history buff.

[stylin_geek]

The Standard Oil Trust actually brought the price of kerosene down a considerable amount. Anti-trust legislation was aimed at the Standard Oil Trust, even though after the company became a monopoly, the price of kerosene dropped a tremendous amount. It went from somewhere around 18 cents a gallon to 7 cents a gallon.

So, again, in what way are monopolies bad?

[stockpirate]

Price gougers my butt, and it isn't even about profits.

These gasstations have bills to pay every week with or without gasoline to sell. If they run out of gas as most expected than they still need to pay the bills, so good planning requires them to guesss how long they would be without gas and to adjust prices accordingly.

This allows them to stay in bussiness when they have no gas to sell.

[flashbunny]

economics and freedom are closely related. Almost inseperable. If you do not have property rights, including the right to dispose of your property according to your own terms, then you do not have freedom - period. Just as it is important to study the fight for freedom over the centuries, understanding how people have fought against the laws of economics and failed is important, too.

Yet people here want to try the same things over again, preferring to stick their heads in the sand rather than admit the failures of the past.

[flaglady47]

Telling the world how virtuous you are for opposing price gouging is not an economic plan. It is not compassionate. Price caps don't work,and have disastrous, even deadly effects. When your imaginary paradise meets the real world, your way is revealed to be an utter failure. Every time.

You seriously should consider a visit to a shrink.

[flaglady47]

Unless they are dead, those people are still demanding gas.

Yes, to put in their cars that are underwater.

[OCgolfer]

Gouging is when the customer needs something that is critical to their health and when the supplier has a monopoly over a short time period. An example would be someone needs a ladder to escape from a burning building and you have the only ladder around. Gouging is if you ask 10,000 dollars to rent the ladder for a few minutes. Here you have a temporary monopoly and the customer needs it to survive

So, if you were making Florida's anti-gouging law, you would put into law that a $10,000 ladder is against the law, but a $9999 is ok? What about the $5000 ladder? Or the $500 ladder? Tell me again what is gouging and how would you write the law? Is a ladder generally considered "critical to their health"?

What about the case of generators? Is $1000 a gouge? Or $500? How would you write the law? Is a generator considered "critical to their health".

Can you see how ridiculous some laws can be?

[konaice]

Gouging can only occur when a monopoly exists.

Not true.

Allegations of gouging in Atlanta and Florida are in the news over the last 4 days.

There is no monopoly, and no immediate shortage. Simply a fear of a shortage sufficient to make people pay $6 per gallon for gasoline for hording purposes.

In these situations gouging is the best thing that can happen. It puts a brake on the hording.

We are not talking about the regulation of monopolies in this thread.

[flashbunny]

"An example would be someone needs a ladder to escape from a burning building and you have the only ladder around. Gouging is if you ask 10,000 dollars to rent the ladder for a few minutes"

Super. Thanks for the most dire example you can think of.

Now, answer a question:

Who owns the ladder?

Now, keep in mind you may want to change the subject to what the ladder owner SHOULD do in this siutation...how he's going to hell if he charges any money, how the goverment should step in and take it, etc. That's the easy way out. Try not to take it. Instead, think about the most basic issue- who owns that ladder?

Your answer will determine what you truly believe in.

Who owns that ladder? The person who planned ahead and bought it, the people who didn't plan ahead but need it, or the government?

If you answer 'the person that bought it', you believe in freedom.
If you answer 'the people who need it but didn't plan ahead', you believe in theft.
If you answer 'the government', you believe in socialism.

Only the true owner of the ladder has the right to determine how something he sacrificed his time and money to buy has the right to determine what he should do with it. So answer who really owns that ladder.

Of course, forcing people to acknowledge this distinction will likely either get me called a nazi, cold hearted, or whatever else the offended party can managed to spew out with the hatred and anger. But it doesn't change what they believe in at their core. The personal attacks and emotional bile that spews forth is just a sign that they only can think with what they feel at the moment. They have no core principles on which they are based - they merely drift along from situation to situation, changing their principles like a weather vane in a windstorm.

[OCgolfer]

You seriously should consider a visit to a shrink.

I'd also be interested in hearing your anti-price gouging proposal, flaglady47. Maybe I need a shrink too. :)

[flashbunny]

"You seriously should consider a visit to a shrink."

Wow, pithy. But again, I predicted it.

You have nothing to back up your arguments. You have no core principles. Only emotion. So your only outlet is yet another personal attack.

Every time governments do what you advocate, people suffer, and some die.

Yet you think you are the compassionate one.

Way to go, Hillary.

[flaglady47]

I'd also be interested in hearing your anti-price gouging proposal, flaglady47. Maybe I need a shrink too. :)

You throw them in jail, just like Jeb Bush has said he will do in Florida if he catches gas stations dramatically overcharging. That should solve the problem.

[FreedomCalls]

Yes, to put in their cars that are underwater.

First, most of the people evacuated a week ago in their cars. The figure usually tossed around is 90%. They still have operable cars and are using them. You are concentrating on the 10% who did not. Secondly, the 10% still are actually demanding gas from the system -- although indirectly. How did they get to Houston? Did they walk or did they ride in a vehicle? How does their food and other necessities constantly arrive at their new location to keep them supplied? Carrier pigeons?

[OCgolfer]

You throw them in jail, just like Jeb Bush has said he will do in Florida if he catches gas stations dramatically overcharging. That should solve the problem

That's pretty scary. Tell me, should he also be thrown in jail if he decides he doesn't want to sell his $6 gas for $3 and decides to close the gas station?

[konaice]

Gouging is when the customer needs something that is critical to their health and when the supplier has a monopoly over a short time period.

I'm sorry, but you don't get to define gouging for us.

"Gouging" (to the extent that it exists at all) can occur without a monopoly and without a real shortage, and without any threat to health or safety.

All it takes is a perceived shortage, or a perceived impending shortage.

Further, in those cases where such a perception triggers panic buying, the natural tendency is for prices to go up, because a properly functioning market derives the highest price the customer is willing to pay, and/or the lowest price at which the supplier is willing to sell. This is a GOOD THING^tm. It regulates demand. It regulates supply.

Gouging is ill defined, but generally is perceived to be any price which results in "excess" profits (what ever that might be). Gouging is largely a pejorative used to describe a market situation unfavorable to the the person making the allegation. There is no universally accepted description of the term in Economics.

Gas stations in Atlanta can charge $6/gal not because there is an actual shortage in Atlanta, but merely because there is a perceived future shortage.

They can do this without any collusion in what clearly is a non-monopoly situation, by simply doing business according to the free market principals.

[stylin_geek]

Let me see "Those who refuse to learn from history are doomed to repeat it." Santyana, I believe.

[stylin_geek]

Define "dramatically overcharging."

[flashbunny]

He's the one who said it best.

This thread is a little like the collapse of the soviet union. Liberals still thought the principles could work, it's just that the 'right people' weren't in charge. The supposed conservative / freedom oriented people here somehow think THEIR price caps (which is what anti-gouging laws are) will somehow work this time. Because they have good intentions, of course.