scratch-mark

Price Caps = Price Fixing = Stealing; Price “Gouging” = Freedom (and it’s good for thirsty babies)

Emotions are not tools of cognition

But set that aside, for now. Then, ponder its meaning after digesting the following.

Last March, I had occasion to blog about ABC’s John Stossel calling out the morons for thier lack of vetements.

This is a bit different. First, you must read Stossel’s op-ed, In praise of price gouging. Some key excerpts, but you ought to read the whole thing (short).

Consider this scenario: You are thirsty — worried that your baby is going to become dehydrated. You find a store that’s open, and the storeowner thinks it’s immoral to take advantage of your distress, so he won’t charge you a dime more than he charged last week. But you can’t buy water from him. It’s sold out.

You continue on your quest, and finally find that dreaded monster, the price gouger. He offers a bottle of water that cost $1 last week at an "outrageous" price — say $20. You pay it to survive the disaster.

You resent the price gouger. But if he hadn’t demanded $20, he’d have been out of water. It was the price gouger’s "exploitation" that saved your child.

It saved her because people look out for their own interests. Before you got to the water seller, other people did. At $1 a bottle, they stocked up. At $20 a bottle, they bought more cautiously. By charging $20, the price gouger makes sure his water goes to those who really need it.

The people the softheaded politicians think are cruelest are doing the most to help. Assuming the demand for bottled water was going to go up, they bought a lot of it, planning to resell it at a steep profit. If they hadn’t done that, that water would not have been available for the people who need it the most.

[…]

Consider the storeowner’s perspective: If he’s not going to make a big profit, why open up the store at all? Staying in a disaster area is dangerous and means giving up the opportunity to be with family in order to take care of the needs of strangers. Why take the risk?

Now to the funny part. The parade of useful idiots. Here are some letters republished from Stossel’s weekly email:

"John, The following is a serious question: Are you retarded? I just finished reading your op-ed piece on price gouging and I can’t decide if there is some tragic and pervasive problem with your mind, or if you are just the most dishonest, most despicable man on the planet…How do you sleep at night?" Steven Bandyk

"Price gouging is illegal. It kills people. Or is that ok with you, too?" Sharon, Binghamton, NY

"you’re article ‘in praise of price gouging’ is the single stupidest, most offensive thing I have ever read. I hope you lose your job over this you soulless cretin." Rev. T. Sam Bailey

"You sir are scum. Plain and simple, you are scum. How dare you say that the price gougers are saving lives." Robert Pearce, Knoxville, TN

"When I see someone like you on television I know you spent a lot of time under a desk somewhere. Seen you on 20/20 a couple of times and you have to be the biggest idiot I have ever seen. Guess that’s why I never tune you in anymore. What a nut case you are. ABC must really be hard up." Harold Dundee

"You’re a truly a bottom feeder, the lowest form of scum. Anyone who says that only those who can afford things like water and food are the ‘truly needy’ is just an idiot. I suppose using your logic, that if you lived in occupied Poland during the Second World War, and you saw someone selling out their Jewish neighbors to the nazis that you’d feel that they did what they had to to survive? I can’t believe a reputable media organisation like ABC keeps you on. Do you have any shred of humanity left? Do you actually feel it’s ok to sell your fellow human beings ‘down the river’ in some sick social-darwinist idea of survival of the fittest? Where do you get your ideas? Mein Kampf? You disgust me and I’m going to write everyone I can at ABC…" John Arnold, Aberdeen, WA

"Stossel, give me a break. You can’t be this dumb, can you? The price gouger isn’t saving resources for those who need it…he’s ransoming those resources to the highest bidder. So your little scenario really ends up with the baby dying from dehydration because the parent didn’t have $20 bucks on them. I guess that makes the gouger a murderer using your logic…"

Yet, not everyone who writes to Stossel is a useless moron.

"Would you rather have the baby die because there IS NO water left? Or have the chance that the store owner sees a dying baby and gives up a $20 bottle of water? In your world, there is no water left for the baby regardless of the kindness of the store owner. On the other hand, the baby has at least a chance, even if the mother has no means or money (which is unlikely she wouldn’t be able to scrounge up something to save her own child). Stop assuming business owners are evil. They are just like you. Have you learned nothing from the price caps applied to the gas market in the 70’s, look what that did for supply? You could only buy gas on certain days, supply was nearly run-out completely. Take a look at history and stop being so naove…"

"The store owner who charges $20 for water might have the resources to help the woman with the thirsty baby. When prices are controlled, the store owner closes his doors, and the baby dies. When the free market moderates the prices, lower priced water floods into the area in a normal competitive fashion, and the baby gets a drink. Gouging saves lives, hoarding at artificially low prices (set by the truly evil politicians and bureaucrats) kills babys. John Stossel is courageous for standing up for good, amid the politically correct morons that post here."

"the everyday consumer does in some fashion horde resources for themselves if they can get it for a lower price. That is why I witnessed everyone last week rushing to top off their gas tanks before the prices went up…Price is the primary signal to efficiently direct limited resources to those with the most need. Without it we would have to rely on our incompetent goverment (republican and democrat) to ensure everyone got what they needed (and we’ve seen how well that works)."

"Anti-price gouging laws have been passed for builders in areas affected by hurricanes dating back to hurricane Andrew. In every case, these laws have effectively ended rebuilding in the area. I know your government school educated mind has a hard time understanding the market, but it’s irresponsible to be so naive…Anti-price gouging laws will leave the entire Gulf Coast in disrepair and make it impossible for the rest of the country to get the gasoline it needs. Here is a link to help you start your re-education. I hope you can learn enough to abandon your destructive viewpoint.

Richard Nikoley

I'm Richard Nikoley. Free The Animal began in 2003 and as of 2021, contains 5,000 posts. I blog what I wish...from health, diet, and food to travel and lifestyle; to politics, social antagonism, expat-living location and time independent—while you sleep—income. I celebrate the audacity and hubris to live by your own exclusive authority and take your own chances. Read More

8 Comments

  1. dtom on September 15, 2005 at 21:27
  2. Doug Wolf on September 15, 2005 at 22:09

    Rich,

    Generally when I read your articles, I only post a response if I can come up with a (in my opinion) intelligent retort, or in some way open a debate that is worth having.

    But for once in my life, I'd like to just chime in with a "well… DUH!".

    Where have people gotten this bizzare notion that "businessmen" are evil? Why is it somehow more evil for a business owner to serve his own best interests than it is for *any* individual to serve their own best interests?

    There are indeed some folks who own business that are evil…. just as there are folks who *don't* own business that are evil. But in general, business owners are providing the jobs that allow you to feed (and buy water for) that baby in the first place!

    To your list of evil meddling with freedom and free markets, please add (along with "price caps"), "subsidies" and "tariffs".

    'nuff said.

    — Doug

  3. Kyle Bennett on September 16, 2005 at 07:51

    " Where have people gotten this bizzare notion that "businessmen" are evil?"

    The one single ideological battle that has defined all of human history is collectivism vs individualism. How collecivism arose in the first place, I don't know, but I have some hypotheses.

    One that is most likely partly responsible is that it is a fallacious extension of the observable fact that when small groups cooperate, they can accomplish more. This cooperations works great in small groups where everyone knows everyone else, knows what they are doing directly, and have some emotional connection to each other. It falls apart completely when the group gets big enough that any one of the three no longer apply.

    Individualism reconciles this wto a larger society through division of labor and voluntary trade, collectivism reconciles them through heirarchal command societies.

    A darker reason that almost certainly has contributed to the perpetuation of collectivism is that the less able or the simply lazy can acheive more through collectivism by taking from those more able or less lazy than they can with the limited effort they are willing or able to put forward.

    In light of this ideological battle, anyone practising individualism is naturally evil, they have the opposite ideology.

    But collectivism is based on a fundamental contradicion – the idea that people can as a group have ideas, thoughts, interests, etc. Individualism is a simple fact of nature. Human minds cannot share concepts, and thus cannot, through any gymnastics of thought, create a group that has the same atributes as an individual.

    In order to mainatain the ideology of collectivism, then, one must go to increasing lengths of fallacious logic in an attempt to reconcile the root contradiction. Since that contradiction is irreconcilable, these attempts are also contradictory. So then those new contradictions have to be resolved, and so on and so on.

    The result is that businessmen have to be evil because it is impossible to reconcile the root contradiction if businessmen are good. But then that contradiction has to be reconciled, and so we find that the nature of money and trade must be redefined, then the nature of law and government must be redefined. Then when that redefinition of law and government is found to be incompatible with the US's founding ideals, those ideals must be redefined, history must be rewritten to eliminate the facts that reveal this contradiction. The founding fathers must be cast as demons in an attempt to negate their ideals.

    Finally, an ultimate point is reached where there is nothing left to redefine, ignore, evade, or force, that can reconcile the contradiction. At that point the only option that does not include renouncing collectivism is to deny the fact of contradictions themselves. And this can only be done by renouncing entirely the idea of logic itself. Some do this implicitly, through tactics of simply avoiding any argument using logic.

    But look in some of the dark corners online, and you will find many people in this final state of complete cognitive collapse, where they state explicitly that logic is not valid, and that they can prove it. At that point, such people have declared themselves to be no longer human. But that's OK, they will then gladly renounce all that is human in order to not have to renounce collectivism.

    At that point, what you find is a Green.

  4. Kyle Bennett on September 16, 2005 at 07:54

    To your list of evil meddling with freedom and free markets, please add (along with "price caps"), "subsidies" and "tariffs".

    Isn't that what the FDIC is? Isn't that what a monopolistic force-backed goverment protecting our rights for "free" is?

    Doug, you seem to know the facts, it's some of the conclusions that flow from them that you have trouble accepting.

  5. Doug Wolf on September 16, 2005 at 13:23

    Kyle,

    You were doing so well until you fell off the deep end. 🙂

    At that point, what you find is a Green.

    Ignore for a moment the eco-terrorist nut-jobs. (In fact, for most of our debates, lets try to ignore the nut-jobs on all sides.)

    I know you hate it when I start talking about "middle ground", but alas.. the notion of extreme individualism does smash into reality in a couple of places.

    I'm going to take a very extreme example. Let us suppose that Mr. X has found a way to "mine oxygen". He's discovered a wonderfully efficient method of sucking the oxygen out of the air so that he can then sell it back to us. (I'm choosing an extreme example so that the point is obvious.)

    Obviously, from a 100% pure free-market philosophy, this is a great thing.. he'll be generating wealth for himself and his employees.

    Obviously, from any rational point of view, killing off most life on earth for the benefit of one (or a very few) individuals is a terrible idea.

    I consider myself a "ecological conservative" is the most literal sense. While it might be economically beneficial for *you* as an individual to fish-out the oceans… it's not a particularly good idea for the rest of us.

    Our choices are *not* limited to "pure free market" and "pure communism". I maintain there are times when our collective values and best interest (i.e., oxygen and food) outweigh the right of any one individual to derive a profit.

    Your obvious retort is going to be "Great… where do you draw the line?" I have to admit, experience and a familiarity with history (along with my own philosophical convictions) says "when in doubt, decide for the rights of the individual". But I'm not willing to say that in all cases, the rights of an individual outweigh the rights of the rest of us collectively.

    You asked about the FDIC… and I'm still considering that. One one hand, I (personally) *require* a stable banking system so that there is a sufficiently robust economy for me to be able to find skilled workers and to sell my goods. On the other hand, I have to wonder if perhaps the government hasn't usurped the function of what should rightfully be a private enterprise. (i.e., deposit insurance.)

    So yeah… I would agree that the FDIC is a subsidy. And like I said… subsidies are evil. 🙂

    — DW

  6. Kyle Bennett on September 17, 2005 at 07:51

    Doug,

    Your mistake regarding greens is your identification of what you think the green movement is about. Think about what it is rather than what it is called. Sure, there are some honest conscientious enviromentalists in the green movement, but the movment as it curretly exists is one devoted to reducing human beings to the same level as animals. And it seeks that explicitly and on principle, not just as an unintended consequence.

    You identify a problem that libertarian philosophy cannot deal with: the property status of those things that by their natures must transcend property boundaries. Air, water, sunlight, the earth itself, some wildlife, etc. Libertarian philosophy stops at "Non-initiation of force", and thus cannot address these issues.

    Objectivism goes deeper, and sees NIOF as a derived principle – it is based on deeper principles. It may have an answer to these issues, but that is still an open question from everything I know.

    I (personally) *require* a stable banking system so that there is a sufficiently robust economy for me to be able to find skilled workers and to sell my goods.

    Don't make the mistake of thinking that this is in the same class of problems as those above. You may require a stable banking system, but you don't have the right to one. You only have the right, along with everyone else, to act in whatever ways (with all the usual property caveats) that are necessary to create and maintain that value for yourself. Nobody is under any obligation to produce it or maintain it for you. Along with the right comes the responsibility to yourself to act to protect yourself against the risk of that system no longer being there, or being seriously undermined.

  7. Doug Wolf on September 17, 2005 at 23:32

    Kyle,

    Don't make the mistake of thinking that this is in the same class of problems as those above. You may require a stable banking system, but you don't have the right to one.

    Agreed. I may not have the right to one (because, I think I've mentioned before, I get mighty uncomfortable with anyone's claim to "rights")… but I do indeed require one for my prosperous survival within our current society.

    Nobody is under any obligation to produce it or maintain it for you.

    But, living under the government that we do and in the nation that we do, it is in my best interest to try to persuade my peers that our laws and customs should reflect the common value of a robust economy.

    Hope you guys are having a good weekend!

    — DW

  8. The Commentator on September 22, 2005 at 16:26

    I must say that this is one of the more enlightening blogs around – posts and comments alike. I'm not even sure I can keep up. That's a good thing. Indeed, things are truly bizarre in this postmodern system. The other day I was in a discussion with TWO wealthy businessmen who untiwttingly agreed with big government and socialist policies to prove their dislike of Bush. They failed to see the inherent contradiction in their arguments. They felt man was too greedy to be left to his own devices. Too often people simply talk without thinking things through. Economics is a prime example. In Canada and Europe, the individualist who excels is purposely slowed down so that the mediocre can keep up. I see Stossel's point and the responses were all too typical. In Quebec, where parts of the province wallows in 20% unemployment, Wal-Mart tried to set up. Before it could even open its doors the region that needed the jobs the most wanted to unionize. Bye-bye Wal-Mart. It was the correct move. I'm not sure this ties with this post but it's all in the same area of discussion I suppose. Price ceilings are superficial. Just like wage control. Anything that is specifically designed by bureaucracy automatically runs contrary to the human spirit.

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