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To: sully777
Every gas station that raised prices for gasoline from 1.50 to 3.50 in my area after 9-11 went bankrupt.

That's totally different. For one thing, they were charging more than the market would bear, which is always a bad idea. For another, in that situation, there was no shortage of gasoline that needed to be remedied, and no mechanism by which high prices would attract more gasoline to aid stranded motorists.

In the case of a hurricane, prices are high because the supplies are low. The first order of business is to increase the supply of whatever is lacking. By allowing price of widgets to rise sharply in the afflicted area, you automatically attract widgets to that area. As you say, no government intervention needed. Enterprising people outside of the area will load trucks with widgets and drive them in, in hopes of making a quick buck.

If instead the price of widgets is not allowed to rise, the widget shortage will continue until the government corrects the problem it created. "The widgets will be coming any week now. But get in line: maybe we can ration you a widget or two to hold you over until they come in."

23 posted on 09/17/2004 8:48:45 AM PDT by Physicist
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To: Physicist

That's totally different. For one thing, they were charging more than the market would bear, which is always a bad idea. For another, in that situation, there was no shortage of gasoline that needed to be remedied, and no mechanism by which high prices would attract more gasoline to aid stranded motorists.



9-11 is a prime example because S&D-gouging did occur that day. No one knew the scope of the disaster. People were making runs on Billy Bobs because reports talked of other planes and the futures market in a state of shock (but shut down for the moment, with the prospect of Arab terrorism including future OPEC embargoes. The supply was questioned openly. Billy Bob made a hefty profit for himself and his supplier based on the version of S&D you espouse.

And that gets to the crux: Fact of the matter is that Billy Bob got a call from Sinclair Oil to raise the price ASAP. Conoco also told its venders to raise prices although at a significantly lower gouge.

(And yes, we all remember Conoco and Sinclair and their stations are doing piss poor in this area).

You must remember that oil stocks at 9-11-01 were very similar to oil stockpiles today--low. Refineries were down for repair. Fall oil formulae were being phased into production. Supplies were very tight. If the market followed S&D rules as per your post, the price of gas should have been $5-10 within a day, with supply trucks hauling gas away from fly-over country to high volume markets such as LA/SF, Great Lakes, East Coast, DFW-Houston-San Antonio Golden Triangle for greater profit motivation.

Thankfully cooler heads prevailed in the national emergency over Maslow's theory. 9-11 is a prime example that there's more to life than profit motivation. Blood money is never worthwhile in the long run, just ask Judas or Billy Bob. Which gets back to my original contention with the S&D comment. IMO, Hume and some of the other free market philosophers kicked morality out of the economic system they envisioned thus making their conclusions flawed in this respect. America thankfully adds the moral dimension into the equation, making us the most prosperous and giving nation in world history. The formula should not work that the more we give the more we receive and yet we are living proof of the very same moral law ignored by some free capitalists.

However, I do agree with you concerning excessive government taxation (which should never be considered charity because it is coerced and confiscatory) and destruction of Bill of Rights for their own greed for power and money. Interesting how politicians are applying a version of S&D to their power/money motivation-benefit. It's not pleasant or productive years down the road.


27 posted on 09/17/2004 9:42:32 AM PDT by sully777 (Our descendants will be enslaved by political expediency and expenditure)
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To: Physicist
people outside of the area will load trucks with widgets and drive them in, in hopes of making a quick buck.

When a storm the size of Texas is about to hit the state, all lanes on evacuation routes are redirected in a direction away from the storm. Rail and airports close and planes are either flown out, hangered or tied down with a hope for the best. It would be a very hard working and death defying widget provider, possibly interfering with evacuation, who brought his product in.

In the first few days after the storm has passed, live power lines and downed trees usually result in a request from local authorities to stay off the roads and allow emergency personel the greatest opportunity to get to people in need. Priorities are set so that people who require electricity to survive are provided assistance first.

My son works as a grocery stock boy. In the days before the storm, he was stocking water. Water supplies are frequently contaminated by power failures. The grocery store, realizing that a storm was coming, ordered in extra pallets of water and other supplies. Their volume was huge and they made good profit. My son made money stocking water. Doctors in emergency rooms made money caring for patients...but as a person licensed to do business in the state of Florida, doctor's can't jack up their rates in the hopes of profiting the storm. Why should we allow congress to get away with this?

28 posted on 09/17/2004 10:17:42 AM PDT by Dutchgirl (FreeRepublic !! The best pajama/ cocktail party on earth!!)
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