Absent government interference with basic economic laws, North Carolinians would not be facing gas lines and shortages. In the wake of Ike, prices would have skyrocketed ? forcing people to think twice before making panic purchases of gasoline. Pre-Ike supplies would have lasted longer.
In addition to limiting purchases, the higher prices (acting as an “invisible hand”) would have steered more gasoline supply to North Carolina. Customers would have grumbled about the high prices, but I suspect they would be grumbling less than they’re grumbling about empty gas pumps now.
Instead of allowing the market process to work, state officials activated a price-gouging law that forces gas station owners either to ignore the need for higher prices or to hire a legal team that can justify higher prices to skeptical politicians.
Seeing the negative consequences of the price-gouging law, the politicians could say, “You know what. It just didn’t work. We’re out of gas. Let’s scrap this thing.” Instead, we get this:
Gov. Mike Easley says gasoline
distributors in Charlotte can get more fuel for stations they serve if
they haul their trucks to the coast.Easley said Monday gas at port terminals in Wilmington and two other
states should help reduce supply problems in North Carolina –
particularly in Charlotte. Some outlets have been empty for days.The governor said his office is trying to connect needy distributors to the oil companies with port supplies.
What’s sad about this mess is that Gov. Easley likely believes he’s helping people by inserting himself into a process that works just fine without him. Had he never activated the price-gouging law in the first place, he wouldn’t feel the need to try to micromanage gas supplies now.
Remember this incident the next time you think government offers the best solution to a problem.
