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To: Dan Evans

I don't hate anyone. I simply call a buzzard a buzzard. The gougers aren't helping anyone. They're stepping hard on the truly helpless. Sorry, but I'm not buying the "gouger as filling a public interest need" line today. Perhaps I will after the sting wears off around here.


10 posted on 08/24/2004 11:49:28 AM PDT by dukeman
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To: dukeman
Sorry, but I'm not buying the "gouger as filling a public interest need" line today. Perhaps I will after the sting wears off around here.

The sting it is going to take a lot longer to wear off if you have to wait a year before you can hire someone to get that tree off your roof.

11 posted on 08/24/2004 12:03:41 PM PDT by Dan Evans
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To: dukeman
When there is a high demand and limited supply of anything, there has to be a way to ration it. Raising prices not only rations the immediately available good in a rational way, but it also insures that the supply will become much less limited as quickly as possible.

For instance, suppose I sell widgets. I can get $10 per widget at my home in Swan Quarter, NC. Suppose that I read that widgets are going for $100 apiece in southwest Florida. That might induce me to pack up my supply of widgets, leave my comfortable air conditioned house and my lovely wife, and drive a large truck or train load of them to Florida, so that I can sell them at a higher price.

The beneficial effect of this is two fold: first, it makes widgets available to the residents of southwest Florida at some cost; and second, it increases the supply of widgets in southwest Florida, thus putting downward pressure on the price.

If I cannot charge a higher price for my widgets in southwest Florida than I can get at home, I am going to stay home in my comfortable air conditioned house with my lovely wife and perhaps donate a dozen cans of food to the food drive that some church will have to help the victims of Charley. (N.B. Expect some snide comment from southernnorthcarolina about it being more pleasant in ravaged southwest Florida in the middle of a hurricane than being in Swan Quarter on the most pleasant day of the year.)

Perhaps this argument breaks down when you are dealing with something like insulin, but I have been through many bad hurricanes in 50 years of living in coastal North Carolina. In reality the absolute necessities of life are not in short supply for any significant period of time. The wonderful people of the Salvation Army, various churches, FEMA, the National Guard, and a raft other government and eleemosynary institutions are on the spot within 12 to 24 hours with food, clean water, diapers, medicine, etc.

It is unpleasant for days and weeks after a hurricane, but making goods available at some price cannot hurt the situation, and as stated by Jacoby, it almost invariably helps the situation immensely. If you still doubt what Jacoby says, read Adam Smith's Wealth of Nations

17 posted on 08/24/2004 2:51:38 PM PDT by Tom D. (Beer is Proof that God Loves Us and Wants Us to be Happy - B. Franklin)
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To: dukeman
This article has new currency with Frances approaching eastern Florida.

My sister-in-law's family lives in and around Vero Beach, Florida. Last evening he mother was waiting in a very long line at Home Depot trying to get plywood. There were long waits while people bought plywood faster than trucks could bring it in. HD was limited each customer to six sheets.

Imagine that the law allowed the price of plywood to triple. More businesses would be willing to haul plywood from more places. With more supply, people could spend time actually boarding up and preparing rather than waiting in line. If plywood became more expensive, perhaps some people would forgo putting plywood on garages and people further from the coast might forgo plywood all together, thus decreasing demand. This would also shorten the lines and give more people time to get boarded up and out of the way. As it stands though, the cost has shifted from dollars to time spent in lines.

As indicated above, when any good is in short supply, there needs to be a rational way to ration that good. Cost is the best way to do that because it simutanelusly decreases demand and increases supply.

21 posted on 09/02/2004 4:57:18 AM PDT by Tom D. (Beer is Proof that God Loves Us and Wants Us to be Happy - B. Franklin)
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