That’s the best one can say about the price gouging nonsense the House passed last night. The bill would authorize the Federal Trade Commission to define price gouging — in other words, passing the buck from lawmakers to unelected bureaucrats.
Further, in a market of choice between competitors, how would price gouging exist? I’ve heard commercials by local news stations with hot reports about how “customers paid $5.75 a gallon before they knew better.” That sounds like uninformed customers not making a responsible market decision. The price of a good is what people will pay for it. That “gouging” station will gouge for a short period of time before his customers dry up, and he has to lower the price to bring them back. Accordingly, if costs (like, say, crude oil) go up for all retailers, they’ll all increase prices at the same time.
Collusion is one thing. Theoretically, it would enable oil companies, distributors, or retailers to fix prices. But without collusion, price gouging is a fiction. The Bill O’Reilly/black helicopter crowd won one last night.
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