As Floridians assess the damages caused by Hurricane Charley, Roderick T. Long has written a timely post at Liberty & Power reminding us of the idiocy of anti-gouging laws. These are laws that prohibit charging greater than customary prices for products that are in high demand and short supply during and shortly after a disaster.
Not only is it immoral to prohibit such transactions; it’s counter-productive. It reduces the extent to which these goods that people want and need are available at prices that they are willing to pay. How does that help the situation?
Anybody who wants to provide charity in the form of selling high-demand goods at below market prices would still be free to do so, without these laws. Anybody who is offended by others profiting from other people’s misfortune would be free to get off his ass and provide these goods himself if he thinks it’s a good idea to help people in this way.
What the laws do is to remove the incentive for others (who don’t want to engage in this form of charity, but have skills at bringing these products to market) to make these goods available faster. Interfering with the market pricing mechanism just guarantees a prolonging of the shortage.
This is just another example of politicians hurting people by taking advantage of their ignorance to score political points. All of the guilty politicians either know this, or should know this.