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September 01, 2005

Idiots at the NY Times.

One part of a sentence in a leader. A demonstration of the most stunning ignorance:

...and profiteering must be brought under control at a moment when television has been showing long lines at some pumps and spot prices approaching $4 a gallon have been reported.

Guys, prices are signals. Prices go up it encourages people to offer more of the item for sale. What do we want to happen in those flood affected areas? Why, for more people to get gasoline in there to offer for sale. So high prices, in response to shocks like this, are a good idea.

Sheesh, you’d think that someone there would have read a textbook at some time of their lives.

September 1, 2005 in Economics | Permalink


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Tracked on Sep 1, 2005 4:48:50 PM


European Governments do this kind of thing all the time. I bet the NYT wouldn't criticise that.

Posted by: EU Serf | Sep 1, 2005 10:34:34 AM

As well as being a signal for more supply, surely high prices encourage more disciplined usage in times of shortage.

But enough of theory. On the practical side has the editor of the NYT considered how much harder (and thus more expensive) it must be to get a tanker load of diesel into Louisiana at the moment? From the news I that see any budding fuel baron will need skills more akin to those required to cross the Amazon basin on foot than those of a yorkie munching trucker.

Typical effing NY liberals. Profit is always nasty (unless its from the movies, "art" or journalism, of course).


Posted by: Remittance Man | Sep 1, 2005 1:22:56 PM

I'm not sure that it is even necessary to have read a textbook: some experience of life, or possession of a few of zee leetle grey cells, would do.

Posted by: dearieme | Sep 1, 2005 1:26:59 PM

Effing NY liberalism seems to be spreading... One of its supporters is a certain George W Bush, speaking on ABC this morning.

And Louisiana law makes it illegal for providers of goods and services to hike prices in the aftermath of a natural disaster. So the NYT is only calling for the rule of law to kick in.

Tim adds: Dosn’t make me all that confident about the state of Louisiana law really.

Posted by: Third Avenue | Sep 1, 2005 1:54:37 PM

Even fratboy can distinguish "market forces" and "price gouging".
"I think there ought to be zero tolerance of people breaking the law during an emergency such as this, whether it be looting, or price-gouging at the gasoline pump or taking advantage of charitable giving, or insurance fraud," Bush said in an interview on ABC's "Good Morning America."

Posted by: Tony Hatfield | Sep 1, 2005 5:07:17 PM

Even fratboy can distinguish "market forces" and "price gouging".

This makes every politician dumber than a fratboy. Which, honestly, isn't all that shocking. Every time there's a crisis, some idiot pol or another gets his/her panties in a bunch about price spikes. Like, they think both supply and demand are completely price inelastic, or that prices are determined by evil pixies. Morons.

Posted by: Timothy | Sep 1, 2005 5:52:16 PM

I'm a big fan of price-gouging, at least compared to shortages. Last year we had gasoline lines in Phoenix because there was a pipeline break that caused a shortage, but station owners were being threatened by the AG if they raised prices too much. So of course idiots were getting in line when they had 3/4 of a tank left just so they could top off. If somebody had been allowed to go to $5.00 a gallon those idiots would have waited while those running on fumes (i.e., me) would have been able to at least get enough to keep going.

Posted by: Brainster | Sep 1, 2005 10:28:09 PM