BrianGarst.com

It’s a little weird to think of Nevada as a place to reject free behaviors that harm no one, but that is precisely what state Sen. Dina Titus is proposing to do with her quest to ban “price gouging”.

People like Mrs. Titus would argue that price gouging does harm people, but they are fundamentally wrong. The single most important concept behind any free trade is that everyone wins. If a person chooses to purchase a product, it is because they have decided it is to their advantage to do so. Only when they would not voluntarily purchase a product do they find it to be to their disadvantage to pay the cost of that item. Milton Friedman once said, “underlying most arguments against the free market is a lack of belief in freedom itself.” What Mrs. Titus is really objecting to is freedom. She does not want individuals to be free to choose when an item is worth its advertised cost to them and when it is not. What’s more, she is the one bringing harm upon consumers in her ill-conceived attempt to “protect” people.

[In an emergency], if ice prices rise to the market, the man who needs to keep his insulin cold for his diabetes treatment will place a higher value on it than the man who wants to keep his beer cold, and will have a better chance of getting it. The man who might rent two hotel rooms for his family for additional comfort might, in the face of appropriately higher prices, inconvenience himself and only get one, releasing one for another whole family.

Mrs. Titus can afford to harm these individuals in her populist chest-thumping attack on price gouging, because they’ll never know they’ve been harmed. When disaster strikes and there are no supplies, it will be the Mrs. Titus’ of the world that insure goods take longer to arrive than they otherwise would have, but no one will notice at the time that, if it weren’t for liberal meddling, they might have had crucial supplies a little bit sooner. Thus it usually goes when people try to step in and say they know better than the market.

Hat tip: Club for Growth

"price gouging"