Price Gouging: The Economic Fallacy Of Emergency Situations
Channel: PeacefulAnarchism
Date: 2014-11-04

According to Wikipedia “Price gouging is a pejorative term referring to a situation in which a seller prices goods or commodities at a level much higher than is considered reasonable or fair.” This often occurs in the context of a natural disaster or other emergency. Such unusual circumstances immediately increases the demand for necessary items such as food, water, clothing, gasoline, and generators. A cursory glance of the situation may yield a vile contempt for the sellers of such highly priced items during times when they are truly needed, however one is advised to not draw hasty conclusions on a whim without adequate thought. When considered a little deeper one will discover the utter elegance of the free market at work in such scenarios. 

The price mechanism is unreservedly beholden to the laws of supply and demand. In emergency situations the supply for certain items are increased. Since resources are finite and human desires are infinite the price must either naturally rise to meet this demand or less product must be sold for the same previous price. The deleterious effects of “government” imposed price controls, while superficially appearing to bestow mercy on the victims of the catastrophe, actually harms the victims even more. This occurs by the resultant shortages and surpluses as those who do not necessarily need the products buy up large amounts of them at artificially low prices and either hoard them or sell them back to the public at vastly exaggerated prices for an obscene profit. Long lines, lack of food, or a lack of heating during emergencies are some of the painful consequences we must endure living under a Socialistic authoritarian “government”. The penalty for entrusting our lives to sociopaths is the extent to which we must suffer under their rule.

“The government solution to a problem is usually as bad as the problem and very often makes the problem worse.” Milton Friedman

http://peacefulanarchism.com/price-gauging-the-economic-fallacy-of-emergency-situations/

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