Carpe Diem

Shortage of generators in north New Jersey? Not on Craigslist, the informal marketplace where market prices prevail

There are more than 600 listings on the North New Jersey Craigslist for portable generators, with prices starting at about $700, but with most going for $1,000 and up.  Here’s an example of a new Black Max 5,000 watt generator that was purchased at Home Depot (according to the ad) and is now selling for $1,100 on Craigslist. That generator normally sells for about $700 at Home Depot and elsewhere.

So apparently the “price gougers” entrepreneurs and speculators are buying up all of the portable generators at Home Depot, Sears and Lowe’s at regular retail artificially low prices and re-selling them at prices that many consider to be “price gouging” what the market will bear, or market prices.

And here’s a listing on Craigslist in the generator category warning people of the “Generator Scam” – “The listings for generators are from people looking to take your money! The generators were purchased at Lowe’s, Home Depot, Sears, etc. They only cost $799!! These people stood in lines to buy generators only to take your money and make a profit. In return many people are without a generator – many little children don’t have electricity in their homes because their parents can’t afford to pay twice the price of a generator from price gouging!”

Well, maybe if Home Depot, Sears and Lowe’s had been allowed to raise their prices to $1,000 (or more) this week to reflect the true value of gas generators following the hurricane, more people with children would actually have a generator right now because the retailers wouldn’t have sold out so fast!  And you really can’t blame the retailers for not raising prices, because they could have been charged with price gouging by the state of New Jersey.  So now gas generators are sold in the secondary market for market-based prices on Craigslist, where it is probably difficult for state officials to charge individuals with “price gouging.”

Bottom Line: The active market for gas generators on Craigslist demonstrates that government enforcement of “price gouging” laws doesn’t eliminate voluntary market transactions for critical items like generators at market-based prices, it just drives the market for generators into the informal marketplace on Craigslist, where market prices prevail.

115 thoughts on “Shortage of generators in north New Jersey? Not on Craigslist, the informal marketplace where market prices prevail

  1. So, if a church wanted to buy generators to donate, they’d have to pay $1,100 instead of $700, thanks to “entrepreneurs and speculators.”

    I suspect, by the time production ramps-up for generators, the emergency will be over. Then generators will be available for $400, when victims of the natural disaster no longer need them.

    • Once the price comes down, the churches can then buy a large inventory of (100?) generators at $400 and incur the cost of storing them for the next 5 or 10 years until the next big hurricane. Then they’ll be ready to donate them, and they won’t have to pay $1,100.

      But then there’s the storage costs and the opportunity cost of the funds tied up, so it might actually cost more than $1,100.

      And it doesn’t have to be churches, you can do that Peak, or you can buy some in your area now at the regular retail price, and rent a U-Haul, drive to NJ, and donate them.

      • re: churches and generators

        should churches really get in the business of buying and selling generators ?

        better perhaps would be for the church to buy it’s own backup generator to power it’s own shelter – with it’s own pre-provisioned fuel supply – like natural gas or propane.

        the problem with most gasoline generators is their fuel use – which means you have to go get more – which assumes you have a car and gasoline available nearby.

        generators are not necessities anyhow like food and medicine and other staples that people need to survive, people that live in apartments and cannot use generators generally anyhow.

        Much more important is where they’d find food – and prescription drugs and the like.

        there’s much more damage than just the lack of electricity and those who want to make this disaster all about market pricing and shortages are whistling in the wind IMHO.

          • Methinks, the supply is fixed in the short-run, since it takes time to produce more generators.

            I guess, you believe the millionaire banker in Manhattan should get everything he needs, while the poor old grandma on Social Security in Staten Island can suffer and die.

          • “the supply is fixed”.

            No more so than gasoline or pinto beans. The disaster hit the Eastern Seaboard. There are a surplus of generators in the Mountain West, but getting them from Denver to Newark in these conditions is neither easy nor cheap. Government anti-gouging laws have insured that it is also either unprofitable, or illegal. So, the generators will stay in Denver.

          • What Brotio said. I’ll add that you are one deluded puppy if you think the rich i-banker isn’t the one getting whatever he needs in either scenario. If I have to sell my now much more valuable goods at stale prices, I’m putting family and friends before some stranger’s grandma. Charity begins at home. And who do you suppose has more connections that can hook him up with scarce goods – the i-banker or the grandma?

            Dude, you wouldn’t have survived to reproduce in the price controled world of the Soviet Union.

  2. the big Achilles heel with gasoline generators no matter the price is the availability of gasoline to power them.

    remember – during a power outage, the gasoline station ALSO does not have power to pump and the ones that do are soon out.

    so is anyone selling gasoline on Craig’s list?

    • I’ll bet there’s quite a bit of re-sale, Larry. Go over to Cafe Hayek and take a look at Don Boudreaux’s recent post on gouging where he recounts the story of a second cousin who bought it from his neighbours in the 1970′s.

      • I LOVE Cafe Hayek. Very cool blog over there. unfortunately it is blocked at school. I’m decent friends with my old Econ teacher and may ask if he can get it unblocked for reference at school.He actually showed me this blog.

        • Wow. Why would a great site like Cafe Hayek be blocked? Is someone afraid students might learn some actual economics or logical thinking?

      • there’s obviously “opportunity” for “neighbors” to go on a gas run to a far enough away place where it’s available and bring it back to share but I suspect those who brought it back to sell at exorbitant prices to their neighbors would not be welcomed.

        I think you woefully underestimate the average person’s sense of morality during disasters. Most people do not
        appreciate those who are benefiting at the expense of others – even if it somewhat mitigates some temporary shortages.

        people remember who did it and those folks usually have
        to move on afterwards as they are not wanted nor accepted any more that a corner drug dealer.

        • Morality has nothing to do with what people appreciate. Morality has to do with doing the right thing.

          People do not appreciate a Nazi pride rally in their hometown, but is it moral to shut them down?

          People do not appreciate it when a criminal walks free at a trial, but is mob justice moral?

          People do not appreciate it when a politician walks over their rights, but is an assassination moral?

          People do not appreciate high prices, but would killing the merchant be moral?

          There is no moral code out there that prohibits profit. Not Christian, nor Jewish, nor Muslim, nor Atheist. All of these accept the profit motive as a reasonable and fully acceptable motive for providing help.

          Charity is a good and glorious thing. It represents the best of humanity. The thousands of people who are down in New York and New Jersey right now, cleaning up the cities are good people. But they are not enough. They need the connections that merchants can provide. Even Christ Himself said He did not have the resources needed to save everyone from their temporal lot, and He is divine. Charity is a good start, but it is not the be all and end all. Charity is a compliment to commerce, not a competitor. Charity catches those who fall through the cracks. It was never intended to do more. To ask charity to take care of everyone is to invite disaster. Let charity and commerce go hand-in-hand to solve our problems. Do no limit either.

        • there’s obviously “opportunity” for “neighbors” to go on a gas run to a far enough away place where it’s available and bring it back to share but I suspect those who brought it back to sell at exorbitant prices to their neighbors would not be welcomed.

          Do you even try to think about what you’re writing before you post it?

          First of all, let’s ignore the logistics here, as you have, or we won’t have anything to discuss. If one neighbor can drive somewhere and get a supply of gas sufficient for everyone, then so can anyone else, and there’s no serious shortage, just inconvenience.

          Assuming you don’t feel foolish yet, and that’s a pretty good assumption based on your past comments, what do you think would be a reasonable price for this civic minded gas runner to charge for the gas he brings back, based on his costs to get it? Should it be more than the price posted at the nearby station that’s closed?

  3. Here’s what I find sadly amusing: The same people who trot out “the poor” to bitch and moan about briefly increased prices resulting from a natural disaster forget all about “the poor” when they insist on artificially and permanently increasing the price of food by forcing food companies to attach a worthless label to perfectly safe GMO foods (California prop 37).

    • Liberals generally don’t actually care that much about the poor. They care about two things:

      1. Being SEEN as helping the poor. Loudly touting activities that can be labelled “helping the poor” make them look good. This works especially well if you’re using other people’s money. Hence Joe Biden can run around claiming that he is helping the poor while his own charitable giving (prior to becoming VP) was virtually zero.
      2. Getting more and more power to make decisions about how other people live. Since you are much wiser than others, it stands to reason that you should have more authority to allocate their resources.

      We have spent untold amounts of money on various Wars on Poverty. The number of people on welfare keeps increasing. The number of people “in poverty” keeps increasing. If “helping the poor” were really your objective, you’d have to say you were failing. But your two real objectives would be fully satisfied.

  4. re: churches “donating” generators

    the whole concept is silly perhaps contrived tongue-in-cheek to start with.

    there are not near enough generators even for an entire church and so you’d be asking people in the church to donate money to buy generators when the folks in the church itself needed generators.

    I help out at a church pantry – and I can tell you that distribution is strictly based on need and rationed.

    that’s the way that churches work – they have limited means and strive for fairness and equity – totally UNLIKE the “free market”.

    Most people APPROVE of the churches using “need” and “rationing” so it’s not surprising that they would expect
    a similar approach from govt -in disasters.

    What I do find interesting is that in our neck of the country, schools and churches and other local community institutions are designated shelters.

    They have backup generators, adequate fuel for several days, cots, and stores of canned food – paid for with taxes and in the bigger scheme of things a very small per capita tax compared to the biggies likes schools, law enforcement and fire/rescue.

    I’ve not heard much about such shelters in NJ and NY although perhaps not reported or reported and I missed it.

    • The difference is, if people do not wish to wait in the church’s lines, but rather seek supplies elsewhere, the church cannot force them to do otherwise. What anti-gouging laws do is say “No, you will eat from our soup kitchen.”

  5. And if enough people are upset about the secondary market on Craiglist, they will call their state legislators and they will try to enact a law against it. Thirty four states do not have anti-gouging laws because lawmakers were sitting around and did not have anything better to do.

    It will take much more than a supply and demand chart to convince average voters to re-elect someone who advocates high prices to solve supply problems in an emergency.

    • “It will take much more than a supply and demand chart to convince average voters to re-elect someone who advocates high prices to solve supply problems in an emergency.”

      That’s true. It will require that voters be educated in basic economics. And that is also something I have written letters about.

      Right now, the typical high school graduate knows more about cultural diversity and about the evils of big corporations than he does about the economic principles which really control his life.

      Your arguments this week about price controls seem to be that trying to educate the voting public is a waste of time. I disagree completely with you on that point.

      • re: convincing people about Econ 101.

        I’d posit that all you really have to do is to convince them that the Econ 101 path is a better path than price gouging restrictions.

        people may not be able to grasp the finer points of Economic theory but they respond to known outcomes regardless of the theory behind it.

        So what we have is not economic theory ignorance but rather serious skepticism that the “theory” will produce better outcomes. (and also assuming what people perceive “good outcomes” to be).

        elected officials are not likely to go against what most of their constituents believe – even if they think their constituents are wrong. For instance, you’ll likely not see a single elected official advocating letting gasoline prices rises as high as the market will bear because it will assure an adequate supply.

        Has anyone heard any elected official making that argument?

        • people may not be able to grasp the finer points of Economic theory but they respond to known outcomes regardless of the theory behind it.

          No, Larry boy, you are living proof that not only are there people who don’t understand economics, but that they don’t respond to predictable outcomes even when bitten in the ass over and over.

      • “Your arguments this week about price controls seem to be that trying to educate the voting public is a waste of time. I disagree completely with you on that point.”

        My argument is that there is not a visible group of people with the political wherewithal to get price gouging laws changed, so it is not going to happen. We can revisit this point in six months and see if I am correct (we are at 34 states and D.C. with anti-gouging laws on the books now). Resources should be spent fighting winnable battles. Educate away, but have a plan B ready if you fail.

  6. The majority of businesses in and around those struck by Sandy do not price gouge. They know their local customers will remember – and once things are back to normal – take their business elsewhere.

      • re: laws – that’s how people formalize their dislikes.

        you and other keep thinking binary on this – as if there are only two options.

        there are a wide range of options that range from ostracizing those that are known that engage in it to the fly-by-nighter types hoping to make a quick buck on those who are vulnerable or at a disadvantage.

        why you fail to understand Methinks is that people are not like you and those who think like you. They do not see everything in terms of dollars and cents.

        if everyone was like you – we’d have no churches or charity because everyone would be out for their own bottom line and not willing to share.

        People who care about other people – and want to share – do not act in opportunist ways during a disaster.

        they do the opposite.

          • In fact, no. But it somehow doesn’t surprise me that a complete moron like you doesn’t realize that giving pre-tax dollars simply means that you are able to give more because you don’t have to pay taxes on it. And imbecile like you believes that “writing it off” means you don’t actually part with the money.

            Never mind me, asshat, what have you done besides sit on your ass and spout endless justification for theft and coercion? Since you’re so given to charity, what have you done?

          • @Methinks – it’s not what or how much you give to charity as much as it is what you advocate for – to happen to people in a disaster.

            in my view, your attitude towards people in distress in a disaster is repugnant no matter how much you “give”.

            you have the classic “let them eat cake” issue and you excuse it by saying you “give” to charity.

            most people – including those that give a LOT (WAY more than even you!) to charity ALSO support laws against predatory and opportunist behaviors in a disaster. They see BOTH things are moral and right.

            you excuse your anti-people attitude by saying you “give” to charity.

            Bill Gates would be horrified!

          • You’re an imbecile lacking even a shred of moral fiber. You and all your leftist buddies. I can only hope that you one day suffer and suffer greatly from the very policies you pigs squeal for and to which you condemn innocent people.

          • re: leftist buddies

            you mean Christie and Bloomberg? I didn’t realize they were “leftists” but hey.. I learn everyday from folks like you!

            I’m with most Republican Mayors and Governors on predatory business behaviors during disasters, and who are you with?

            I just strongly disagree with you – but I do not need to call you an asshole… you know? you’re one arrogant son of a gun though.

          • Larry, I think you are being rather unfair.

            Charity and commerce are both ways of accomplishing the same thing. It is perfectly moral to support charities and fight anti-gouging laws.

            Look, we know anti-gouging laws create shortages. This is not only true in economic theory, but in real life. I mean, just look at the gas lines. Is waiting in line for something you don’t even know if it will be there somehow more moral than paying someone more for no line and a gaurenteed product? Is having a store shelf completely empty of supplies, but at “acceptable” prices somehow more moral than having a stocked store with higher prices? Look, I understand the whole “suffering for Salvation” mentality. I fast through Lent. I get that. But it should be a choice.

            Methinks is not advocating “let them eat cake.” All she is saying is give people the choice to buy or sell these generators/fuel/food/water.

            There is no profit bottom line here. What we are talking about is getting necessary supplies to where they are needed. We can bitch and moan all day about what the “proper” price is, but we have the luxury of food, water, electricity, and heat. They do not. While we sit on our ivory thrones arguing morality, they are cold, wet and hungry. There are people out there, right now, how have the supplies they need. Let them go to New Jersey. Let them help! Really, what these laws do is prevent help when it is needed most. Is that moral?

          • Jon – I do not support price controls on anything at any time except during disasters.

            and I started out fairly polite but sticking to a point that I supported.. and.. willing to listen to other views.

            that hardly makes me a leftist nor an asshole.

            We can debate and disagree civilly and I do appreciate that with you.

            but some days I get short tempered at the infantile reactions from some here.

            It’s hard to tell what Methinks “thinks” when she’s hurling insults left and right…and truth be known, when she is like that – I simply don’t care what she thinks.

            she can behave and be civil or she can be a snarling cur …. it’s her choice.

          • We can debate and disagree civilly and I do appreciate that with you.

            Do you have Alzheimers? If what you said upthread is what you consider “civil” and “polite”, then you are one demented asshole.

          • and Methinks you are one infantile girl. you keep throwing the insults fool girl, and you’ll get them right back.

            that’s the only way to deal with people like you.

            straighten up and behave yourself if you can.

          • But it is in disasters that we need the market the most. During the good times, when goods are plentiful, the damage done by price controls is limited, at best. In bumper years, not many of us complain about corn prices.

            But when a disaster strikes, and goods are in limited supply, there needs to be an encouragement to get more of the needed supplies to the disaster areas. Artificially creating shortages will not solve the shortage problem.

            I understand what you are saying about equality, but that doesn’t solve the problem. It’s like pulling off a band-aid slowly: the pain may be lesser, but it lasts much longer than it has to.

            Now, I am not saying we have to do away with the rationing. I just question why it has to be the only choice. If the government wants to buy food, water fuel, blankets, clothing, and distribute it, that is fine. I see that as a perfectly legitimate role for the government. But do not restrict others coming in to help just because you question their motives. Let everyone who wants to help come in. Let those who wish to pay the premium pay it. Let those who wish to stand in line do so.

            We can rebuild New York (New Jersey got an upgrade in the storm :-P). But to do so, we need to allow cooperation, not hinder it.

          • re: ” Now, I am not saying we have to do away with the rationing. I just question why it has to be the only choice. ”

            Jon – how do you get away with saying something like that and not get called an asshole?


            I actually agree with you. I do NOT think it’s the ONLY option either.

            I actually would support SOME higher prices for SOME things during a disaster.

            As I said earlier – I am OPPOSED to any/all price controls outside of disasters.

            And I’m content to abide by what most people want during a disaster.

            but when the Govs of two states both impose limits during a disaster – they do not do that lightly and both would be thrown out of office if in doing that – most people disagreed with it.

            The way I see it – either you try to control predatory business practices in a disaster OR you’re going to need a LOT of police and military because once people know the rules are “get whatever you can get” – they’re going to join in that game with weapons ala New Orleans style.

          • And don’t kid yourself, Larry. You poor defenseless victim. I’ve stupidly wasted countless hours patiently explaining elementary concepts to a moron who lacks the intelligence to grasp and make no effort to grasp.

            You’re the thug who seeks to rob people of their few options and no matter how many times and in how many ways that is explained to you by well-meaning people, you not only insist that robbing people is great, you accuse those trying to help of being uncharitable. You’re worse than anything I’ve called you on this thread. What you really are can’t be mentioned in public under any circumstances. May the next disaster hit you and may you rot in it to get a well-deserved taste of your own medicine.

          • Both of you need to calm down, or I am going to bitchslap a voodoo dummy that will represent you.

            That’s a lie. I don’t have a voodoo dummy. Those things creep me out.

          • Trust me, Larry, I’ve been called much worse than “asshole” :-P

            Mentally deficient, most recently. But also on the list are:
            Genetically inferior
            Koch Brothers Enforcer (I kind of like that one)
            and dumbass.

            But back on topic, I think there is rather a large difference between predatory pricing and robbing someone at gunpoint.

          • re: ” a large difference between predatory pricing and robbing someone at gunpoint.”

            Jon – do you think one could lead to the other if no police are around?

          • re: how much do you give?

            it not how much you give – it’s how much you give relative to what you have – not only in money but in other ways.

            money is not the sole determinant for most folks.

            “giving is more than “money”.

            Jon knows that I bet.

        • aha, you laugh, but in a generation or two public schools will have sufficiently dumbed down the population so that people will believe that will work.

          • Obama has already said he would stop the rising of the oceans. I assume he meant through legislation. How much harder could it be to prohibit hurricanes?

  7. When you are miles away, with food in the fridge, heat and a roof over you head, looking at issues like this through an econoimic lens is pretty darn easy. I would bet the view differs for those that are wet, cold, and hungry. Price gouging is just that extra salt in the wound at times like this that would drive me to want to beat someone.

    I can understand the economic rationale posed by some here, I’m just pointing out – not every situation warrants taking an “economic” view.

    • Yes, and I can understand why an addict might think that mugging someone to buy drugs made more sense than going into rehab, but that doesn’t mean that’s the decision that will benefit him most.

    • So, you think it’s more humane to prevent cold, wet, hungry people from alleviating their condition at any price. Noted.

      Personally, if I were wet, cold and hungry I’d want to option to pay a price to get dry, warm and fed. But you jackbooted compassion thugs are eager to rob people of their few remaining options in the wake of horrific losses.

      Nice job.

      • Do I think it’s more humane to prevent cold, wet, hungry people from alleviating thier condition at any price? Noted.

        Tell me, how were you able to surmise THAT from what I wrote?

        • what do you mean by: “I’m just pointing out – not every situation warrants taking an “economic” view.”

          Which, incidentally, can be read just as easily as “not accepting reality”. You can wish that scarce resources weren’t more expense, but you’d have to kiss reality goodbye to think you can legislate such a thing.

          In the context of your comment, I took this to mean you think pro-shortage laws are a great idea because pointing out that people hate paying a higher price for goods is just a banality.

          • What I meant was; not every situation warrants taking an economic view of it. If one doesn’t take an “economic” viewpoint of every situation in life, it doesn’t necessarily mean they are not accepting reality.

            Here’s an extreme examples: It’s far more “economical” for parents of a severely mentally challenged child to have him euthanized as opposed to spending years, stress and untold sums caring for him over his lifetime.

            Here’s a more subtle example: A Methinks who sits in her warm house, miles from the disaster with food in the fridge and roof over her head has the luxury of saying “it’s good for sellers to charge exorbitant prices in a crisis because it’s good economics.” However, a Methinks who has just lost her home, has no food and shelter would take a different viewpoint of being charged triple for all of her basic needs – because THIS Methinks does not have the luxury of it being merely a thought exercise.

            Another example: A Budweiser bottler in Georgia has switched over to filling their beer cans with water and are donating 44,000 cases for free. They are not looking at this situation in pure economic terms.

            Better yet; are things that matter most to you in life measurable in economic terms?

          • I see, Moe. The answer is you have no idea what you meant and you think that euthanizing a child is a decision similar to paying more to acquire milk right after a hurricane.

            A Methinks in desperate need of milk is willing to forgo some of the itunes songs she was planning to buy in order to acquire it right after a hurricane. A Methinks who doesn’t have the option to acquire milk at any price because the store shelves are empty and will stay that way for a while because prices can’t adjust to compensate the suppliers of milk for bringing the supply will be one pissed off person.

            If you can’t understand that, I can’t help you.

          • I think that euthanizing a child is a decision similar to paying more to acquire milk right after a hurricane…that’s what you got from my comment?…pathetic the way you have to mangle peoples comments into something you can argue against.

            What lala land do you inhabit?

            You assume you’ll have access to milk that will only costs you a couple MP3s? on an iPod you assume you will still have after a hurricane that sent your house a mile down the road? and if you don’t have access to milk you’ll be angry?

            I hope to God you never have to endure a hurricane… the shelves are gonna be empty no matter if your rose colored economic RayBans are on or not…

          • Well, Moe, I inhabit the the lala land where where i don’t confuse the economic decision to buy milk with the moral decision of not killing a child.

          • What the Methinks without shelter might also decide is that since anti-gouging laws make it illegal for a motel owner to raise his prices to reflect the sudden increased value of his rooms, that it is more convenient to rent a separate room for her pain-in-the-ass teenagers, whereas at market value, she might think it’s worth tolerating the brats, thus freeing up a room for someone who desperately needs shelter.

          • Normally, I’d agree with you, Brotio. If i got to the hotel with my bratty teenager and annoying cousins before all the rooms are rented out, I’d put them into seperate rooms (so they can’t feed off each other) at the abnormally low price. It would be idiotic not to take advantage of such cheap prices. I might even get a couple for my elderly neighbours too. I’m rich, after all. Hoewever, “moe logic” adds a moral dimention to my economic argument – By buying 5 rooms, I leave less for Moe’s family. As he huddles outside in the freezing rain, he can console himself with the knowledge that at least the hotel wasn’t mean enough to raise prices which would have increased the probability of him getting shelter for the night. Increasing such probabilities is unethical, according to Moe.

          • Oh, I forgot to address Moe’s beer example. Why yes, that is an economic decision, Moe. It’s called “marketing” and companies like Evil Walmart engage in just this sort of activity in order to build goodwill and brand loyalty.

            People also donate all sorts of things to those struck by disaster. Certainly, for individuals and most donors charity is a moral imperitive and a laudible activity. I feel I can safely say I speak for the people on this blog who understand the value of “price-gouging” when I say that we fully support helping our fellow man in need. But, as Jon Murphy so rightly points out, charity will never be enough and it is not in competition with markets. To minimize pain, You have to also allow the price mechanism to signal to providers of goods where those goods are most urgently needed. Prices are the messengers between the producers and consumers and deadening their signal only leads to confusion and pain that charity has no hope of completely alleviating.

        • re: ” Might as well get what you can. In part to avoid having to stand in line all day again in the future”

          there are those that think this way and there are those that will accept sharing….realizing that if it devolves into “get what you can” that lawlessness will accelerate.

          In Port-a-Prince – generators were being stolen from those that bought them – at a premium – literally at gunpoint.

          when basically everyone is doing that – the only way to quell it is with a military mere police are not enough.

          the “get it while you can” folks are not near as rough and tough as the “give it to me or you’ll die” crowd.

          • Haiti? WTF…?

            Do they let you cross streets without assistance? I doubt you can manage that simple task on your own

          • WTF? Port-a-Prince is what happens when fools like you decide shortage policies in disasters.

            that’s essentially what you are advocating.

            you want riots and anarchy apparently.

            90% of what you blather about here is essentially how 3rd world countries “work” which is fine if you are rich and can afford walled compounds and body-guards.

            being “helping across the street” is a minor issue compared to yours.

          • Larry, you wouldn’t know a third world country if it bit you in your behind. You’ve never been out of your mother’s basement except to run to the 7-11 for more jolly ranchers.

          • Larry,

            Your comments on Haiti are pure nonsense. Everyone knows what Methinks was saying…..she was saying that shortages happen because if you just spent countless hours waiting in line then you are likely to want to buy as much as you can get, more than you actually need at the present, and then there will be nothing left for some people who come after you. That is what hoarding is and hoarding does happen and is happening on the east coast right now.

            At this moment, in any city, most people are driving their cars with something less than a full tank of gas. If tomorrow something was to happen in that city (some type of disaster) or even if people in that city started to think that something was about to happen, and that this might hurt the supply of gas, then what you would have is alot of people topping up their tanks. There is alot more excess room for gas in the cars tanks in a certain area than there is gas in the tanks at the local gas stations so this will cause shortages.

            The issue here is do you want people to get the things that they need? Because right not in New Jersey they are not getting it. Why is price more important than need? It is not a moral issue, it is a suffering issue.

  8. Look, no one here is saying to do away with charity, or to make people fight it out on their own.

    Our point is simple:


    This is all we are talking about: choice.

    • This is the same choice every human being on this planet faces everyday. There is nothing special in a disaster that allows people to suddenly be denied the right to choose.

    • To expand on Jon’s point, also give companies the choice to decide to spend more on emergency supplies of goods knowing that they can recoup those extra costs by charging higher prices. Give companies the incentive to bring in those supplies by repealing the price gouging laws, knowing then that they will not have to do it at a loss since they can increase the price to reflect this extra cost.

      Do you wonder why, after 6 days since the storm ended, there are still shortages for gas? It takes 3 or 4 days max to drive from Texas to New Jersey…….there is lots of gasoline in Texas. Why didn’t companies do that as soon as the storm hit?

  9. There is another downside to these price controls:

    They encourage hoarding.

    If you are lucky enough to, having stood in line for hours, actually get the resources you need, the unnaturally low price encourages people to buy more than they need. After all, you just stood in line for an entire day. Might as well get what you can. Hoarding, then, leads to even greater shortages.

    There is nothing about these anti-gouging laws that solve the problems posed by a disaster. They are merely “feel-good” laws: they serve no purpose but to make the ones who passed them sleep better at night.

    • Might as well get what you can.

      In part to avoid having to stand in line all day again in the future.

      I can already smell the putrid “most folks” argument waddling toward you. I do genuinely hope that the people who favour legislation to rob the disadvantaged of options reap what they sow at some point and the reap it really good and hard.

    • re: hoarding

      you limit people to one item per .. some will game it but most will not.

      it’s not an adequate justification for a policy that will actually deny those without adequate funds anything.

      what is worse?

      when items are scarce – you allocate equitably and fairly until the “market” can once again get established.

      • you limit people to one item per .. some will game it but most will not.

        Ha ha ha ha! The family or housemates split up and each person buys the maximum allowed. No business owner is going to add to his burden to police which person belongs to what household. Only unimaginative twits couldn’t figure out how to game that.

        • re: unimaginative twits – most of the retail companies do this on some kinds of sales you know.

          and If a church or local community group is passing out stuff – they “know” whose gaming the system.

          • Actually, they don’t, twit. But, we’re not talking about churches, are we, genius? Unless, of course, you gave money to the church to go buy out the stock in the store, but you believe charity is for other people, so that can’t be it.

      • The market is established! The market never went away! The market is not a physical thing that can be washed away by the sea.

        I think you mean to say when the market returns to normal circumstances. But not allowing the market to operate normally will not bring it back to normalcy any quicker.

        At any rate, how is rationing by decree any better than rationing by price? Because it’s “fair”? If you have a man who doesn’t need fuel, but he still has his ration card and gets his fuel anyway, how is it fair to the man who needs more fuel than his card allows? Decree rationing is inherently wasteful. Resources are distributed, not according to need, but according to policy. That means that some will get wasted (ie, the man who doesn’t need fuel but gets it anyway).

        Wasting scarce resources is not a method for improvement.

      • you limit people to one item per .. some will game it but most will not.

        Complete nonsense. Everyone who wants more than the limit will game the system.

        when items are scarce – you allocate equitably and fairly until the “market” can once again get established.

        Who is “you” in those statements?

        If “you” is the retailer, why should they be made to police people’s purchases? It’s not their job, and exposes employees to abuse and violence. No thank you.

        “You” can’t possibly allocate fairly as “you” have no idea what is fair. “you” can’t possibly know what others’ needs are.

        re: unimaginative twits – most of the retail companies do this on some kinds of sales you know.

        Do you not understand a sales gimmick when you see one? Unimaginative twit is an accurate description, I guess.

        Do you really believe that retailers care who buys their products? Even when cashiers take that limit seriously, multiple members of a group can buy the limit as Methinks explains, you can get in line more than once to buy the limit, and.or you can get in different checkout lines.

        If someone wants to buy more than the limit, they can do so with very little effort.

        If gas is limited buyers who need more will get in line again. this makes lines worse, not better.

        You must have missed the misguided government limits the 70s.

        People will manage to get what they want despite government idiocy. Think of the war on drugs if you have any doubts.

        • isn’t that the way that church’s allocate to the needy?

          most people prefer the ration system rather than auction.

          you convince them how wrong they are and you’re in business otherwise you’re spitting into a stiff wind.

          • isn’t that the way that church’s allocate to the needy?

            Who knows? You’ll have to ask them.

            most people prefer the ration system rather than auction.”

            You have no idea. Stuff pulled from your ass. What we DO know though, from simple observation, is that people sure as hell don’t like rationing and will defeat it every chance they get.

        • there’s another way to go at this and that is there appear to be about 10-15 states that do not have anti-gouging laws.

          those states should be the perfect example of how things work out better when prices can rise according to demand.

          here are the states (I think) that do not have anti-gouging laws:

          New Hampshire
          New Mexico
          North Dakota
          South Dakota

          so do thing work better in these states?

          it’s apparent that most of these states are not subject to massive hurricanes so maybe the history of anti-gouging laws are rooted in areas that suffer major hurricanes.

          • Heh! Where to begin? Ad populum seems to be his favorite, for sure.

            Larry never did explain why he shouldn’t be shot for refusing to learn economics if most commentators on this blog thought it was a good idea.

          • I guess he found that getting trapped in a fallacy noose of his own making is not all he thought it would be.

    • “Under Christie’s order, car owners with odd numbered license plates can get gas on odd days, and car owners with even numbered license plates can get gasoline on even days. If one’s license ends with a letter, Christie said it would be regarded as an odd number.

      Despite the measure, the governor said on Sunday that he could not prevent people from topping off their nearly full gas tanks.

      “You can’t legislate selfishness,” he said.”

      No, your price control policies ARE legislating selfishness! If gas were $15.00/gallon people would not top off their nearly full tank and would instead wait until they were on empty before buying more gas!

  10. I may differ from other libertarian-types when I say I have no issue with FEMA (or their state equalivents) assisting in disaster relief. What I object to is FEMA (or whoever) coming into a disaster zone and saying “We are the only ones who will assist. You will play by our rules.”

  11. Jon says: “There is another downside to these price controls: They encourage hoarding…”

    You make a strong case for government intervention.

  12. I’ll use an analogy to show why Jon is wrong and Larry is right.

    Suppose Jon is on a ship that sinks. He finds himself on a lifeboat with a jug of water and 10 other people on the lifeboat.

    Jon says, I’ll sell half of this jug of water to the highest bidder. Methinks offers a million dollars and Jon decides to share the water with Methinks.

    Do you believe the other passengers, nine Sumo wrestlers, will sit around and die of thirst, while you and Methinks drink the water?

    • Let me explain to Peak, the supposed economist, the obvious flaws in his dumb scenario.

      From obvious to less obvious:

      1.) There is no hope of additional supply from outside suppliers on a desert Island and one can expect that to be an indefinite state. Consulting my map of the United States, New York and New Jersey are not desert islands and are fully accessible to suppliers who are encouraged by the higher prices to supply the afflicted area. Peak doesn’t understand the law of supply and demand, so I’ll just fruitlessly point out to him that increasing supply has the magical ability to drive down price.

      2.) If we’re all in a dingy, headed to a desert island, then my million bucks (assuming I can even get to it) isn’t going to mean anything. Dollars are not the currency on a deserted islands.

      3.) Methinks, the sumo wrestlers and whatever other hodgepodge of humanity is on that boat are probably not quite as simple-minded as Peak Trader and realizes that we have a new society and a new dynamic here. One that has nothing to do with New Jersey, but whatever.

      A small group of people stuck on a deserted island resembles a family and has every incentive to cooperate with each other as their survival depends on the small group. A large state with millions of people doesn’t resemble such a family in the least.

    • In the real world, you own what you can keep…

      Asuming jon owns the water in this particular situation but can’t maintain his grip on it, then obviously jon no longer owns the water…

      BTW nine sumo wrestlers in a lifeboat – that would make for an amazing picture…

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