Three Cheers for "Price Gougers"
Sep 21, 2005

IRVINE, CA--In the face of soaring gasoline prices and angry consumers, many politicians have vociferously called for prosecution of "immoral price gouging."

"The call to prosecute 'price gougers' violates a fundamental moral principle, as well as an economic one," says Dr. Andrew Bernstein, author of The Capitalist Manifesto. "Morally, an individual has the right to ask for any price he wants for a good or service he owns--he is not forcing anybody to buy his product--and a buyer has the equal right to refuse that price if he thinks it is too high. In a truly free society, the government does not have the arbitrary power to dictate to sellers and buyers the terms of a sale. Such power is found in dictatorships, not in nations that respect individual rights."

Bernstein adds, "When the government arbitrarily restricts the price of a good--by threatening to prosecute so-called "price gougers"--it not only violates the rights of all sellers and buyers, it inevitably causes shortages of that good." In the face of the disruption to oil production and distribution caused by hurricane Katrina, for instance, we should desire that prices rise until demand aligns with the more limited supply. This ensures that gasoline will be available to anyone willing and able to purchase it. And the higher prices serve as an economic incentive to oil and gas producers to get facilities online as soon as they can.  

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Dr. Andrew Bernstein is available for interviews. To interview Dr. Bernstein or book him for your show, please e-mail media@aynrand.org

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