There Is a Plague Loose Upon the Land [View all]

[marmar]

Published on Friday, May 4, 2012 by Common Dreams
There Is a Plague Loose Upon the Land

by David Macaray


Most states in the union have laws against “gouging.” Broadly speaking, gouging is defined as the practice of arbitrarily raising prices on necessary goods, such as milk, bottled water, baby food, baby formula, bread, etc., in response to civil emergencies (riots, martial law) or natural disasters (earthquakes, floods, tornadoes).

For example, an anti-gouging law would prohibit the owner of a neighborhood convenience store, in the wake of a massive earthquake, from tripling or quadrupling the price of drinking water. This consumer-protection device is one more instance of a benevolent government’s vital role in regulating the so-called “free market.” What could be fairer?

However, there are market fanatics out there who abhor these anti-gouging laws. One of their arguments is the reliable, time-honored appeal to the “slippery-slope.” This argument maintains that if we allow the government to interfere with the sacrosanct Law of Supply and Demand, if we give it the power to approve or disapprove of a sticker price, the next step will be rigid restrictions on how much profit we’re entitled to make, and the next step after that will be transforming us from the Land of Opportunity into a communist state.

Another argument is that, even in a grave emergency—say, in the aftermath of a major earthquake, with roads buckled, buildings collapsed, gas lines and water mains broken—the free market, in its genius, can be counted upon to automatically make the necessary “corrections,” because competing stores will adjust their prices accordingly, in order to attract customers (as if “comparison shopping” will continue unimpeded). .................(more)

The complete piece is at: http://www.commondreams.org/view/2012/05/04-1