“Colorado law now bans price gouging during disasters — but doesn’t define the term.” Price controls are especially harmful during an emergency.
Posts Tagged ‘price controls’
Colorado Price-Gouging Law
Thursday, July 16th, 2020Prices of Tax-Subsidized Health Treatments
Wednesday, June 24th, 2020“Lawmakers push Covid-19 bills to prevent price gouging, track federal funds used to discover drugs.” To me, this article points to the problems created by government-funded science. People forced to subsidize the development of drugs and treatments reasonable expect government to regulate such things as the pricing of the developed products. I’ll note here that some people (Alex Tabarrok) have the idea of government offering cash awards for the successful development of certain treatments, after which government essentially owns the results. I do worry that politicians looking to control prices will disincentivize some companies from developing some drugs and treatments in the first place. The easiest way not to “excessively” profit from some product is not to make it at all.
Price Controls Are (Still) Stupid
Saturday, June 13th, 2020Economist Michael “Munger explains that increasing prices on in-demand products serves several functions: it discourages people from buying more than they need; it tells producers to make more of this newly valuable product; and it nudges people into looking for alternatives.”
In other news: “Amazon price-gouging crackdown worsened shortage of sanitizer, wipes.”
Colorado Price Controls
Thursday, June 11th, 2020Colorado Senator Mike Foot bragged, “My last bill ever in the [Colorado legislature] just passed and is on its way to the [governor of Colorado]. It adds consumer protections for Coloradans against price gouging during disaster emergencies.” I replied, “This is incredibly stupid. Price controls cause shortages, which are especially damaging in times of emergency. Don’t hurt people, [Governor]; veto this knee-jerk bill.”
New Jersey Attorney General Fights for Shortages
Monday, June 8th, 2020New Jersey’s “Office of the Attorney General has not stopped receiving complaints about businesses illegally hiking prices of cleaning supplies such as bleach and hand sanitizer as well as disinfectant wipes and spray. In the past week, an additional 100 cease-and-desist letter have been sent to business owners who have tried to cash in on the COVID-19 pandemic by price gouging, Attorney General Gurbir S. Grewal said Friday.” The AG has issued a total of 1,586 such letters, NJ.com reports, and state law prohibits price hikes of “more than 10% during an emergency.” In other words, New Jersey authorities want to make absolutely certain to maintain shortages of essential goods during emergencies.
Titone Runs Price Gouging Bill
Friday, June 5th, 2020On June 4, Colorado Rep. Brianna Titone announced, “I’m running the bill on #priceGouging with @mjweissman [Mike Weissman] to be sure that pandemics like the one we’re experiencing now doesn’t result in higher prices merely because they can.”
Previously, Governor Jared Polis encouraged Congressman Joe Neguse to crack down on price gouging: “These tough times bring out the best in us, but also bring out the worst. Thank you @JoeNeguse for going after snakes who profit from exploiting us.” I responded, “‘The snakes who profit from exploiting us’ are precisely the politicians such as @JoeNeguse who impose (or seek to impose) shortage-causing price controls.”
AG Phil Weiser wrote, “Keep the calls coming about scams and cases of extreme price gouging. Here’s our advisory. https://coag.gov/press-/3-12-20/” Reporter Allison Sherry Tweeted March 12, “AG @pweiser office says they’ve been swamped with calls about price gouging on hand sanitzer—turns out Colorado’s statutes don’t have anything in there on gouging but his office is working with Amazon when reports come in.” Weiser wrongly conflates higher prices with “scams” in the press release: “The office’s Consumer Protection Division has been in contact with representatives from Amazon to coordinate efforts to address potential price gouging on items such as paper products, cleaning supplies, hand sanitizer and soap, and other goods. It is important for Colorado consumers to remain vigilant and report any scams. With these reports, the Attorney General’s Office will be able to work with other law enforcement agencies, including on a national level, to protect Colorado consumers and stop fraudsters. If you notice any scams, fraud, price gouging, or other attempts to take advantage of Coloradans during this public health emergency, contact Stop Fraud Colorado at 800-222-4444 or www.StopFraudColorado.gov. “
In an April column, I argued that laws and legal actions against price raising are unjust and harmful.
Update: The Colorado bill in question is HB20-1414.