What Price Gouging?

What The Heck Do They Mean, Price Gouging?

It was in our paper here in Idaho this morning. Similar articles have appeared, I’m sure, in almost any state, county, and municipality across the United States of America, and it makes me shake my head and question where our country is headed.
It was an article about “price gouging” at the gasoline pump.
Gas prices are high. They have been high. Some places have had their gas prices go down as of late, and some places (like Idaho) are still high. People living in high-price places (again, like Idaho) immediately have a knee jerk reaction where they scream, “We need to pass a law to ban this extortionate pricing!” Some have even gone so far as to sue gasoline companies for “price gouging.”
This is ridiculous.
One of the beautiful things about this country is that businesses can charge what they will for their products. If they can make more money, why shouldn’t they? If you owned a grocery store, and people were willing to pay $10 per apple, you would charge $10 per apple, wouldn’t you? Well, if you were smart you would. If the government came along and put a cap on what you could charge for apples, it could hurt your business quite a bit.
This type of legislation is counterproductive, and seeks to solve a long term issue with a short term solution. Inflation would soon render any arbitrary price cap obsolete and even more ridiculous than it is now.
Gas companies have the right to charge whatever they want for gas. If they wanted to charge $5 a gallon, then they could. However, if they did, then fewer people would buy their gas, which hurts business. Therefore, the consumer’s right to choose keeps prices down from what they could be.
Lets extend this out, and extrapolate for a minute. If everyone decided to buy gas only at the gas station with the cheapest gas in town, then every other gas station would begin to lose business. They would have to lower their prices to stay competitive. This lowers gas prices citywide without any federal intervention at all.
Consumer responsibility is key. If people educate themselves and make intelligent decisions, then many of today’s cumbersome legislation becomes superfluous. Consumers have the right to choose to take their business wherever they want, and this power holds great sway over company policies, especially pricing.
Don’t like how a clothing company makes clothes in sweatshops? Buy other clothes. Don’t like customer service at a restaurant? Eat somewhere else. Hate high gas prices? Buy a fuel efficient car, a car with an alternative energy source, conserve energy, and/or shop where gas is cheap. These send a serious message to the corporations… they have lost business. Encourage others to do the same, and that power is doubled.
All without government intervention.