John Locke Foundation’s Jon Sanders wrote a piece for Carolina Journal’s Daily Journal that says North Carolina’s price gouging law makes thing worse, not better. The piece was featured on Instapundit.com.
In the next few weeks, as recovery begins, normally plentiful goods will be hard to come by. Already shelves are emptying of water, bread, batteries, and other survival necessities. Gasoline will also be hard to find. Elsewhere across the country, consumer products will be readily accessible as normal.
But who’s going to bring those necessities to North Carolina if they can’t afford to?
Bottled water suppliers, bread makers, and gasoline distributors are people, and they have families, and they need to be able to take care of their families first. If they see our needs but can’t redirect their supplies into North Carolina while still being able to take care of their families, they won’t do it.
What do you mean, if they can’t afford to bring us water and gas?
Because North Carolina has a law against “price gouging.” It outlaws “excessive pricing during states of disaster, states of emergency, or abnormal market disruptions.”
Jon says that higher prices are not a scam, but “signal flares calling for more supplies”.
Rather than being scams taking advantage of desperate people, higher prices are exactly what we need to ensure we don’t run out of necessities like water and gas. They are like flashing red lights to bottled water suppliers, bread makers, and gasoline distributors in other states, telling them Yes! You CAN redirect your stuff to North Carolina because you can still take care of your families when you do!
“Rising prices are like signal flares,” as economist Art Carden puts it. They’re saying, Bring supplies from where they’re plentiful to where they aren’t!
Look at it from a supplier’s perspective. It costs money to change supply plans, to disrupt your expected distribution of goods, to ship stuff longer distances. If you can’t at least break even doing it, you’d lose money — and that means you’d hurt your family’s interests.
Jon writes that our state’s anti-price gouging law is what empties our shelves in times of disaster. People buy more than they need and stores run out.